The Coming Resource Wars By James Reed

Michael Lind, a liberal nationalist, gives a quite reasonable account of the looming resource wars. There seems to be a perfect storm of events spiralling the West into planned chaos, beginning with the crisis of supply caused by the Covid lockdown mandates and restrictions, through to shortages of key productive elements such as fertiliser, and now the fallout from the Ukraine War, which lingers on, and has diminished grain production. And as detailed below, this is only the beginning, for the Taiwan invasion by communist China will crash the Western IT sphere producing chaos that we have not yet contemplated.

https://www.tabletmag.com/sections/news/articles/the-coming-resource-wars?utm_source=gnaa

“The Russian invasion of Ukraine has made it clear that what Boris Yeltsin in the 1990s called “the cold peace” has given way to Cold War II. The first Cold War was a struggle not only of nations and alliances but also of systems—capitalism versus communism. The second Cold War is already a struggle among systems as well, pitting countries that focus on manufacturing (China) and resources (Russia) in the physical world against an alliance led by the United States, which for the last generation has sacrificed much of its own manufacturing and mining to specialize in global leadership in finance, services, and entertainment. To put it another way, the contest of models in Cold War II is not about ownership of the means of production; it is about material production versus immaterial service provision.

The other side in the new Cold War is very good at making things, mining minerals, and growing food. In contrast, the U.S. economy, although it still manufactures many products and is highly productive in energy and agriculture, rewards and celebrates those who make apps and loans—after a generation in which American business and financial elites made fortunes by offshoring industrial jobs and facilities to China and Taiwan.

Beginning in the Clinton years, policymakers and economists of both parties celebrated the shift of the United States to a “post-industrial economy.” In a speech titled “The Challenges of Success” to tech executives and investors in San Francisco on April 28, 1998, the neoliberal economist Larry Summers, then deputy secretary of the treasury, celebrated the allegedly immaterial information economy: “The twin forces of information technology and modern competitive finance are moving us toward a post-industrial age,” he said. Silicon Valley and Wall Street, not manufacturing or agriculture or oil and gas, symbolized the “new economy.” Summers listed examples of this new economy—“AIG in insurance, McDonald’s in fast food, Walmart in retailing, Microsoft in software, Harvard University in education, CNN in television news.” Let backward, old-fashioned East Asians and Germans make cars and TV sets and telephones and computers; America will sell insurance and infotainment to the world.

In the post-industrial economy, large firms regulated and supported by government and negotiating with organized labor would give way to spunky startups founded by overnight tycoons, according to Summers in 1998: “Look right here in California, where millions are invested before revenues, let alone profits come, and anyone with a good idea can make their first million before buying their first tie.”

A quarter-century later, when it turned out during the COVID pandemic that the United States had ceased making many essential drugs and medical supplies and was dependent on autocratic, anti-American China for many of them, the same Larry Summers was apparently shocked to learn that many things are no longer made in America. On March 21, 2020, Summers tweeted: “Thoughts at the end of a long week: Why can’t the greatest economy in the history of the world produce swabs, face masks and ventilators in adequate supply?”

Cold War II may finally discredit the fallacies of the free market globalist economists who shaped the consensus among both Democrats and Republicans for three decades.

Following COVID-19, Cold War II may finally discredit the fallacies of the free market globalist economists like Summers, Paul Krugman, and Glenn Hubbard who shaped the consensus among both Democrats and Republicans for three decades. Appropriately enough, for a financial and online business services superpower, the United States responded to the brutal Russian invasion of Ukraine with more or less the arsenal described by Summers in 1998—“AIG in insurance, McDonald’s in fast food, Walmart in retailing, Microsoft in software, Harvard University in education, CNN in television news.” The United States waged financial warfare against Putin’s Russia, American credit card giants cut off Russian consumers, and, in a devastating blow, McDonald’s pulled out of the Russian Federation.

It may be that financial and economic sanctions are enough to force Russia to retreat or negotiate. But Germany, the major NATO economy after the United States, is dependent on Russian oil and gas, which Germans continue to buy, partly subsidizing Putin’s military. At the same time, the world’s largest nation and its biggest economy (in purchasing power parity terms), China, which has surpassed the United States in many areas of manufacturing if not yet software, is in a position to help Russia endure Western sanctions as part of a common crusade to drive the United States out of their regional spheres of influence.

Even the beneficiaries of U.S. dependence on China—Silicon Valley, universities, Wall Street, “green” technologies that need Chinese imports—are being forced to acknowledge that we still live in a material world in which countries can be great powers even if they do not dominate global banking and insurance markets, on the basis of mining energy and minerals, growing crops, and making physical things. Russia and Ukraine together are responsible for more than a quarter of global wheat exports. Russia and Belarus together produce nearly half of the global exports of potash, a critical nutrient used in fertilizers, while Russia produces more than a fifth of the ammonia exports used in global agriculture.

For its part, China dominates global production of many essential minerals, both directly—producing 63% of rare earths and 45% of molybdenum—and indirectly, by investing in lithium mines in Australia, platinum mines in South Africa, and cobalt mines in the Democratic Republic of Congo.

A few decades ago, the United States mined and refined many of the minerals it now imports. But thanks to cheap labor abroad, excessive environmental regulations at home, and the fantasy of the post-material “information economy,” the U.S. government allowed corporations to shut down many American mines even as other firms shuttered American factories. The energy analyst Mark P. Mills describes the result:

As recently as 1990, the U.S. was the world’s number-one producer of minerals. Today, it is in seventh place. …

More relevant, as the United States Geological Survey (USGS) notes, are strategic dependencies on specific critical minerals. In 1954, the U.S. was 100% dependent on imports for eight minerals. Today, the U.S. is 100% reliant on imports for 17 minerals and depends on imports for over 50% of 29 widely used minerals. China is a significant source for half of those 29 minerals.

Along with free market globalism, the environmental movement has crippled and endangered the economies of the United States and its allies. Rejecting the asceticism of the old Malthusian left that called for voluntary poverty, edgrowth, and population decline through anti-natalism, establishment environmentalist leaders like Al Gore and his European counterparts have optimistically claimed that existing technology permits a rapid “green transition” from fossil fuels and nuclear energy to solar, wind, and hydro power, with no need to lower Western living standards or cripple what remains of Western industry.

But according to experts on global mineral production who belong to SoS Minerals, in a letter delivered to the British Committee on Climate Change:

The metal resource needed to make all cars and vans electric by 2050 and all sales to be purely battery electric [in the UK] by 2035. To replace all UK-based vehicles today with electric vehicles (not including the LGV and HGV fleets), assuming they use the most resource-frugal next-generation NMC 811 batteries, would take 207,900 tonnes cobalt, 264,600 tonnes of lithium carbonate (LCE), at least 7,200 tonnes of neodymium and dysprosium, in addition to 2,362,500 tonnes copper. This represents, just under two times the total annual world cobalt production, nearly the entire world production of neodymium, three quarters the world’s lithium production and 12% of the world’s copper production during 2018. Even ensuring the annual supply of electric vehicles only, from 2035 as pledged, will require the UK to annually import the equivalent of the entire annual cobalt needs of European industry. …

Challenges of using ‘green energy’ to power electric cars: If wind farms are chosen to generate the power for the projected two billion cars at UK average usage, this requires the equivalent of a further years’ worth of total global copper supply and 10 years’ worth of global neodymium and dysprosium production to build the windfarms.

There is not enough cobalt, neodymium, or lithium being mined and refined in the entire world today for Britain to meet its green transition goals in the next generation. And Britain has only 67 million people. The United States has 330 million. The world has nearly 8 billion. Do the math.

“Clean” energy is not clean. No less than natural gas and oil extraction, extracting the minerals required for solar, wind, and hydro power equipment requires massive mines and destruction of local landscapes and ecosystems. For pointing out this obvious fact, the left-wing filmmaker Michael Moore’s documentary Planet of the Humans was denounced by the organized green lobby, and Moore himself has been canceled by the left.

While some democracies like Australia, Canada, and the United States have significant mineral resources, many of the countries with large mineral resources and reserves are autocracies or fragile postcolonial regimes: China (gold, tin, and bauxite, used to make aluminium), Indonesia (nickel, tin, gold), and Russia (oil, gas, nickel). Half of global cobalt reserves are found in one country—the Democratic Republic of Congo. Substitutes for some of these minerals may be discovered or synthesized. But in other cases, natural deposits of elements that are essential to an advanced industrial society may give particular countries enormous economic windfalls.”