We have reached a limit to growth, and its name is Peak Oil.
From an address by Richard Heinburg to the ASPO International Conference 2009:
As we all know, the global economy began contracting last year—though that’s just a nice, abstract way to put it. Industrial production fell. Corporations downsized or disappeared. Fifty trillion dollars in global capital vaporized in stock market crashes, bankruptcies, foreclosures, and defaults. Millions of people lost employment and housing. Globalization went into reverse.
Also, in 2008 the oil price spiked 50 percent higher, in inflation-adjusted terms, than at any point in previous history. It would be an enormous oversimplification to say that the oil price spike “caused” the world recession, but the fact that the price spike and the economic crisis occurred at the same time is hardly meaningless coincidence.
In effect, we are seeing a vindication of what many of us have been predicting for a long time. Even if it is still technically possible in the next few years for the oil industry to exceed its July 2008 production levels, the world economy has entered a trap from which there is no exit. The oil price that the petroleum industry needs in order to justify developing a new marginal barrel’s worth of production capacity is now nearly as high as the price that is known, on the basis of recent history, to trigger further economic contraction. We have reached a fundamental limit to growth, and its name is Peak Oil.
