The Curse of Oil meets the Paradox of Debt

 

This is a profound and important article by Charles Hugh Smith which combines skillfully the Curse of Oil and the Paradox of Debt to explain why Covid has opened the door to a new era of instability and consequently why there is no going back to the long gone world of 2019. Oil will from now on move from too cheap to pump to too expensive to buy for marginal players, while debt will crush both consumers and companies. We simply cannot expend again out of this rut without breaking the economic cart. The Romans and all the civilizations that came before once faced this conundrum and none found the exit. Complexity also entails deep systemic fragility so in spite of our more advanced technologies it is unlikely that we will find a workable solution to the intractable web of challenges we will be facing in the coming years. Artificial Intelligence may help us find solutions we could not think for ourselves but social rules which we do not yet fully grasp will likely prevent swift adoption of unlikely and unpopular ideas. Conversely, as we are seeing on a daily basis, "more of the same" seems to be the preferred policy almost everywhere...

One Little Problem with the "All-Electric" Auto Fleet: What Do We Do with all the "Waste" Gasoline?

December 14, 2020

Regardless of what happens with vaccines and Covid-19, debt and energy--inextricably bound as debt funds consumption-- will destabilize the global economy in a self-reinforcing feedback.

Back in the early days of the oil industry (1880s and 1890s), the product that the industry could sell at a profit was kerosene for lighting and heating. Since there was no automobile industry yet, gasoline was a waste product that was dumped into streams. Why couldn't the refiners produce only kerosene? Why did they end up with "worthless" gasoline? The answer is a barrel of oil produces a variety of products. While there is some "wiggle room" to produce more diesel and less gasoline, etc., it isn't possible to turn a barrel of oil into only one product. John D. Rockefeller became very wealthy by cornering much of the oil market in the 19th century. But he didn't become fabulously wealthy until the 20th century, when the rise of automobiles created a market for all the "waste" gasoline. Rockefeller became super-wealthy when all the products of each barrel of oil could be sold at a premium rather than just a portion of the products. This reality has been forgotten: the price that can be fetched for a barrel of oil depends on the demand for all the products, not just a few of the products. Those demanding an all-electric auto-truck fleet as a "green" alternative will re-create the dilemma of what to do with the "waste" gasoline. The world will still want fuel for all those container ships bringing all the goodies of a consumerist society, all those cruise ships visiting ports of call, jet fuel for all those exotic vacations enabled by 550 mile-per-hour aircraft, and oil-based lubricants, plastics and petro-chemicals, and so oil will still be pumped and refined, and almost half of it will be gasoline. We can either use it or throw it away but we can't magically turn a barrel of oil into only one product. This is a topic worthy of your understanding, so grab a vat of your favorite beverage and turn off all distractions. Longtime readers know I've focused on energy-oil markets for 15 years. Despite ups and downs in price, the oil market has been remarkably stable. This stability is about to transition to chronic instability: wild swings in price, shortages, and social chaos in both producing and consumer nations. Let's start with the most basic dynamics in the cost of producing oil, refining it and selling the products at a profit. 1. As a general rule, a barrel of oil (42 gallons, 196 liters) yields a range of heavier and lighter products. The price the producers can charge for each product--gasoline, diesel fuel, heating oil, jet fuel, propane, etc.-- depends on demand for each product. If the price for one product falls drastically, the oil producer can't increase the price of some other product to compensate for the loss of income unless demand for the other products will support higher prices. Consider the huge decline in demand for jet fuel as a result of global air travel dropping in the pandemic. Oil producers can't just raise the price of gasoline to compensate for the drop in the price of jet fuel. If gasoline demand continues declining (due to fewer commutes, etc.) then producers can't charge more for diesel to make up the drop in the price of gasoline. In other words, there has to be strong demand for all the products in a barrel of oil for producers to get enough money to extract, refine and transport the products globally. Unlike the old days when producers could afford to throw away some petroleum products because their costs of extraction and refining were so low, now producers need more than $45/barrel just to break even. This is what I'm calling Oil Paradox #1: if demand for any of the primary products is weak, producers can't afford to continue extracting and refining oil, even if there is strong demand for some products. 2. Transportation is the primary use of oil: 68% of all petroleum products are consumed by transport, 26% by industrial and 6% residential/commercial. (These are U.S. statistics, but the global demand is roughly the same.) If demand for gasoline, diesel and jet fuel remains weak, the value of each barrel of oil will remain below break-even, even if the industrial need for some products (lubricants, etc.) is strong because these industrial products are essential to the world's industrial economy. 3. Much of the consumption of the past 20 years was funded by debt, which is now $277 trillion globally and accelerating. Humanity has borrowed and spent trillions on consumption, and what remains is the interest due on the debt. This interest constrains future borrowing. The "solution" to interest is inflation, which devalues the interest due. But it also devalues the purchasing power of the currencies being inflated, and so everyone's money buys fewer goods and services. This is the Debt-Inflation Paradox: the more interest you owe, the greater your need to inflate away the burden of interest. But inflation destroys the purchasing power of money, impoverishing everyone who needs the money to live. There is no way out of this paradox: either the global economy defaults on its debts, destroying trillions in phantom wealth, or its currencies lose value, impoverishing everyone. Since so much consumption is funded by debt, any reduction in borrowing, no matter how modest, will destroy demand for petroleum, triggering the Oil Paradox (producers can't charge enough to justify pumping and refining oil). 4. The pandemic has accelerated consumption trends that reduce demand for fuels. Remote work is here to stay, regardless of what you may read. Corporations can no longer afford to staff centralized offices in costly cities. Making everyone commute to offices is no longer financially viable. Corporate travel is also no longer financially viable. As profit margins fall, the luxury of jetting to physical meetings is no longer justifiable except for senior management-- a few dozen people, not hundreds or thousands. Tourism thrived in an economy of easy, low-cost credit and secure incomes. Lenders can no longer afford to lend to those with poor credit--notice how credit card limits have been drastically reduced--and incomes are no longer secure. If the pandemic were the only issue, it would be possible to see a return to 2019-level consumption. But unsustainable debt loads will only get more unsustainable, so much of the consumption that was funded by debt will go away and not come back: the interest on all the existing debt remains to be paid, one way or another. This decline in consumption has lowered the price of oil far below break-even for most producers. As the article below explains, there are two break-even prices for petroleum: one to get it out of the ground, refine it and deliver it to market, and the second for the social costs the oil pays for. This is the famous Oil Curse: nations with oil reserves end up depending on selling oil for virtually all their revenues because it doesn't make sense to invest in less reliable, less profitable sectors. As a result, Saudi Arabia can pump the oil for $45/barrel, but it needs a price of $85/barrel to pay all the social welfare costs it has promised its people. If you glance at the charts in this article, you'll see the full break-even price of oil for OPEC nations is extremely high. Breakeven crude oil prices are one metric of the economic constraints facing OPEC+ members This generates Oil Paradox #2: low demand/low prices for oil may be financially viable in terms of extracting the oil, but the societies that depend on vast oil revenues will unravel if oil prices stay low, and that will disrupt production. Roughly half of U.S. petroleum production is from tight shale and other unconventional oil sources. Many of these wells are no longer profitable and will be shut down once the producers' credit lines dry up. (This is already happening, triggering mass bankruptcies in the fracking industry). The oil producing nations are basically surviving on $40/barrel oil by borrowing against future revenues. This is a dangerous game because if oil prices remain low their credit lines will eventually be withdrawn. The oil producers need supply to fall drastically enough to raise prices back to the $80/barrel or higher level. But nobody can afford to cut their own production enough to reduce global supply enough to matter. This introduces Oil Paradox #3: should petroleum producers succeed to slashing supply so oil goes to $85/barrel, the higher cost will push the fragile consuming nations into recession or depression, which will slash demand even more, which will require even deeper production cuts to maintain prices. If we put all these paradoxes together, we see that oil markets are now intrinsically unstable and cannot return to stability because the mix of high break-even prices, declining demand and the end of debt-funded consumption cannot be resolved: high prices crush demand, low prices crush producers, and debt is crushing both consumers and producers. Much hope is being placed on so-called renewable energy, most of which is not renewable but replaceable, as I've learned from Nate Hagens. A forest is renewable, a solar panel or windmill must be replaced every 20 years at enormous expense. Right now all alternative energy sources--wind, solar, etc.-- generate no more than 4% of global energy consumption. (see chart below) Despite hundreds of billions of dollars invested, all the alternative energy sources are a tiny fraction of global consumption, and their supposed fantastic rates of growth is revealed on this chart as inconsequential: all this new energy doesn't replace a single drop of oil, it simply fuels additional consumption. It will take a monumental investment and many years to get this to 10%. The reality is the vast majority of the global economy still depends entirely on petroleum for transport and industrial essentials such as lubricants. How (Not) to Run a Modern Society on Solar and Wind Power Alone Petroleum is now an unstable system and for all the reasons outlined above it cannot be restored to stability: just as time is a one-way arrow, so is the loss of stability. What can we expect? Unstable systems are prone to wild swings to extremes and unpredictable collapses. So we may see collapses in the price of oil as we saw in March, and then rapid ascents in price above $100/barrel, which then crash once demand declines. This unpredictability complicates projections and generates uncertainty. This is the final paradox (#4): the unpredictability of oil markets is itself a destabilizing force. Decisions on future production and consumption cannot be long-term, and this constrains investment in future production. Regardless of what happens with vaccines and Covid-19, debt and energy--inextricably bound as debt funds consumption-- will destabilize the global economy in a self-reinforcing feedback.

 

About Those Vaccine ID Cards...

 

It is getting harder and harder not to see what is going on with Covid around the world and that vaccination will be used to control the movement of people.

I was recently discussing with a doctor who told me that a true vaccine against Covid-19 would take at least 10 years to develop and would probably be useless since the mutability of this virus is very high. In other words, we will have a different strain of the virus by the time the vaccine is available. Which is why a vaccine has never been developed against Corona until now and also why so many laboratories were studying this particular virus... in the US, France, Canada, or China!

But why bother with such details? 

You will soon have the choice to get your non compulsory vaccine if you what to travel, work or go out of your home or else...  or so believes the British Government.

Fortunately, as Charles Hugh Smith explains below, it won't be so easy...  

  About Those Vaccine ID Cards...

December 3, 2020

An idea that's simple as an abstraction--vaccine ID cards--turns out to be extremely difficult once real-world operational realities must be dealt with.

Authorities around the world have made it clear that they will do "whatever it takes" to vaccinate their citizenry with one of the first available vaccines. Authoritarian states may mandate universal vaccinations while less authoritarian states will favor a "carrot and stick" approach of offering benefits to the vaccinated and exclusions from employment, education, travel and most of everyday life for those who refuse to be vaccinated.

To identify the vaccinated and unvaccinated, many nations are planning to issue ID cards or "vaccine passports." As an abstraction, this seems straightforward, but if we start digging into the actual operational requirements of this mass ID card issuance and distribution, a number of common-sense issues arise.

Vaccination cards will be issued to everyone getting Covid-19 vaccine, health officials say (CNN)

First and foremost, it's unknown how long the immunity offered by the vaccines will last. It's still early days, so there is conflicting evidence: some claim the vaccines will be longer-lasting than the natural immunity of those who caught the virus and recovered, while other evidence suggests the immunity might decay after six months. Despite claims that natural immunity is long-lasting, a non-trivial number of people who had Covid have been re-infected.

Nobody knows how long either natural or vaccine immunity will last because not enough time has elapsed to collect sufficient data.

Given these intrinsic unknowns, how long will the ID card be valid? It's easy to imagine variations in individual responses such that the vaccines' effectiveness decays more rapidly in 20% of the vaccinated. This variability would introduce tremendous unknowns that no ID card could reflect: is the holder of the card at Month 10 still immune or not?

If the duration of the vaccine's effectiveness is variable, then an ID card could be misleading. In other words, being vaccinated with a variable-duration vaccine tells us nothing about the individual's actual immunity down the road.

Given these unknowns, the vaccinated may need booster shots in the future, and the ID cards would have to be re-issued. The task of keeping track of hundreds of millions of vaccination records, identities and then issuing ID cards is a non-trivial task.

To thwart black-market fake-ID cards, the security measures will have to be equivalent to a driver's license or passport. Have you applied recently for either of these forms of ID? The process is painfully slow. The systems in place to process state drivers' licenses and U.S. passports are already strained, and which agency is prepared to verify the identity of 280 million adult citizens, confirm the validity of their vaccine and then issue ID cards--and then repeat this process in a year?

If the procedures for issuing vaccine ID cards are slapdash due to time constraints--for example, downloading a digital record from the vaccine distributor or a printed card--these will likely be vulnerable to being duplicated or spoofed. Fake vaccine distributors will pop up issuing bogus digital records, hackers might download and sell digital records from trusted sources, and so on.

Then there's the extra burdens being placed on the staff of airlines, cruise lines, etc. to scan these documents and deal with rejected cards. Who will have the legal authority to deal with claims that a rejected card is actually valid? How many smaller establishments simply won't have to staff to do more than glance at the card?

Do authorities have the means to issue hundreds of millions of absolutely secure vaccine ID cards and then monitor all the attempts to find loopholes and weaknesses in the process? If authorities think that strict penalties will limit this activity, they underestimate the difficulty in getting such penalties enforced by overloaded court systems.

In nations with strong traditions of civil liberties, there will be pushback against mandatory vaccinations with essentially untested vaccines and against national databases tying identity to vaccination cards--a situation ripe with potential for abuse.

Authorities don't seem to grasp that many of those hesitating to get vaccinated are not anti-vaxxers; they simply see the vaccine approval process as deeply flawed for common-sense reasons: for example, there is simply not enough data on safety, duration and real-world efficacy.

Authorities are counting on the "carrot" of air travel, cruises and concerts to persuade skeptics to get vaccinated despite their concerns. What authorities don't seem to realize is that a great many people value their health, privacy and agency far more than they crave air travel, cruises or concerts. They will gladly forego all these activities until more reliable data is collected, peer-reviewed and distributed for analysis.

The more draconian the measures designed to pressure people into getting the vaccines, the greater the reluctance of skeptics who see the draconian measures as additional evidence the vaccines are half-measures being forced on the populace as a means of imposing a false assurance that all is well and "normal" will return as soon as the skeptics cave in and get vaccinated.

There's also the possibility that the virus could mutate in ways that moot the vaccines' effectiveness. While this is widely considered unlikely, it's not impossible, either. If a mutated virus arises that evades the vaccine, then what value will the vaccine ID card have?

An idea that's simple as an abstraction--vaccine ID cards--turns out to be extremely difficult once real-world operational realities must be dealt with. The fact is the first vaccines have been rushed to approval with virtually none of the testing demanded of previous vaccines raises common-sense concerns which cannot be dissolved with force or carrots and sticks.

 

China is catching up fast...

 

Difficult not to compare the new Chinese radio telescope in the Guizhou province and the old American Arecibo telescope in Puerto Rico which just crumbled two weeks ago and not draw more general conclusions. 

As the article below explains, the rise of China is unstoppable, surfing on a wave of scientists and engineers which guaranties that over the coming decades, most innovations will be Chinese. 

With this, unavoidably will come the Chinese way of doing things, softly at first then less and less so as time goes on. But looking at what is going on right now in the West, the question is: Will we give up on freedom so fast that our new Chinese social scores or their equivalent make little difference when they are implemented?

 

In a sort of distributed Ouija board enterprise, intellectuals these days predict the likely evolution of relations between China and America. These authorities do not wallow in consistency. China will take over the world. Alternatively, China will collapse because of a surfeit of men, because the different linguistic regions will become independent, because their debt bubble will explode, because the Chinese can’t “innovate,” and because the population is aging and there won’t be enough workers. And of course, the American military will remain regnant over the planet and nearby galactic space. The US will always stay ahead. Or it won’t. This seems to cover the basses.

Well, maybe. But if you watch what the Chinese are actually doing, you may get the impression that China is largely ignoring the American military and letting the US spend itself to death while Beijing focuses on commerce, business, R-and-D, commerce, the economy, education, technology, and more commerce. You might additionally get the idea that China is a confident, well-governed, energetic people on a roll and doing quite well in the inventive department. The snippets below may support this impression of technical and economic vitality.

The future? An asleep thought (I presume this is the opposite of “woke”): demographics is destiny. America draws its scientists and engineers from roughly 200,000,000 STEM-capable whites. Blacks and Latinos contribute, if not negligibly, then almost so. China depends on a billion STEM-capable Han Chinese. These are the people who dominate America’s elite technical high schools and universities. Thus, it can potentially put five times as many scientists and engineers to work on tech work. As America’s schools deteriorate under the assault of social-justice warriors, China expands its already-rigorous schooling. Add that psychometricians put the East Asian IQ about five points higher than that of Eurowhites. Thus, many more and somewhat smarter STEM people from demanding universities against fewer and less intelligent from inferior schools. Then add stable, focused government versus rule by chaos. Arguably, massive Chinese technological superiority might seem likely.

Increasingly America does not compete with China, but strongarms it because it cannot compete. For example, in Five G China is ahead in technology, manufacturing capacity, and turnkey systems. Unable to produce an equivalent product, Washington banned Huawei Five G in the US and has twisted arms to keep countries that it controls from using Huawei. Seeing that Huawei had very attractive smartphones that would have competed with Apple, it banned these also. What America can’t do, it seeks to keep anybody else from doing.

WSJ: “US vs. China in Five G: The Battle Isn’t Even Close

HONG KONG—By most measures, China is no longer just leading the U.S. when it comes to 5G. It is running away with the game. China has more 5G subscribers than the U.S., not just in total but per capita. It has more 5G smartphones for sale, and at lower prices, and it has more-widespread 5G coverage. Connections in China are, on average, faster than in the U.S., too…By year’s end, China will have an estimated 690,000 5G base stations—boxes that blast 5G signals to consumers—up and running across the country .”

Techies can argue C band versus millimeter waves but I will bet that the Chinese, nothing if not commercially agile, will have Five G up and running in factories and the IoT and everywhere else while American pols rattle on about how China is an Existential Threat and the Pentagon needs more money for Space Command and diversity is more important than schooling anyway.

The shifting balance may already be visible. For example, America used to make superb aircraft such as the SR-71 and the F-16. Now it has the F-35, an engineering horror. The Boeing 737 MAX, its flagship product, has been grounded internationally because of poor engineering, second-rate software, and corporate lying about both.

America invented the microcircuit, and once dominated its manufacture. Today, American companies cannot make the seven nanometer chips now used in high-end telephones, and certainly not the five nanometer chips now coming online. Neither can China. Both countries buy them from Taiwan Semiconductor Manufacturing Company, TSMC, Interestingly, the Taiwanese are genetically and culturally Chinese. Washington has strongarmed TSMC into ceasing to sell to Huawei—the US still can’t make high end chips. Recently it strongarmed TSMC into agreeing to build a semiconductor fab in Arizona. Because America can’t.

Then there is TikTok, a hugely popular Chinese video app that threatened to break America’s lock on social media. Unable to compete, Washington decided simply to confiscate it on grounds that it might be used to spy on Americans. (Chinese intelligence is deeply interested in your daughter’s video of her cat.)

Parenthetically, technology seems to be shifting toward East Asia, with America being less ahead in things in which it is ahead and behind in others. Did I mention demographics?

• “COMAC’s Hydrogen Fuel Test Plane Completes Ten Flights”

Commercial Aircraft Corporation of China. Airlines are looking hard at hydrogen as a replacement for petroleum with no carbon emission.

China chooses landing site for its Tianwen-1 Mars rover. Whether the lander, currently en route, will land or crash and burn remains to be seen—it is China’s first time out, so to speak. In either case, that the country, forty years ago arguably the poorest in the world and thinking that making pencils was high-tech, has built a Mars lander is, well, weird.

• “Electric planes closer to reality with China’s first flight”

“Four-seater electric aircraft makes first flight in north-eastern Chinese city of Shenyang”

Good for 180 miles, say the Chinese, expect more with improvements in batteries. Intended for short-haul flights, deliveries.

• “China rolls out Long March 5 rocket for Chang’e 5 moon sample-return mission launch”

Impressive engineering, at least if it works, but not revolutionary. What is impressive is that so many tech advances come rapidly. at night and end up betting on a bar fight. My guy loses. How do I pay you a hundred bucks? Cash? Don’t have it. Check? Don’t have one with me, and you would have to go to a bank to cash it. ATM? Late at night in a probably dangerous city. And so on. With WeChat Pay or Alipay, my phone gives the money to your phone in perhaps as much as two minutes. In China, four of five transactions are by mobile app. It works, and is fantastically convenient, because everybody has one or the other, and they are universally accepted.

Those who follow China soon notice that when Beijing needs to decide something, it does, without fifteen years of talking, congressional infighting, and interminable lawsuits. When it decides that something is important, it does it. Right now. Commercially, the Chinese are quick and cutthroat. They have been called the Jews of Asia. And only a billion of them.

“Hualong One (HPR 1000) is the 3rd-generation nuclear power brand to which China has exclusive intellectual property rights.“

Washington tries to cripple Chinese technological advance by denying access to intellectual property, driving Beijing to design its own, thus creating a competitor for American firms.

• “China Tops 110 Million Five G Users in Less Than a year”

• “China Replaces Russian Engine in J-10C Jet With Locally-made WS-10 Taihang”

“The WS-10 Taihang is China’s first high-performance, high-thrust turbofan engine with intellectual property rights, Chinese Central Television reported.” (The J-10 is a fighter plane.)

A serious weakness of Chinese technology has been the inability to make jet engines. It still can’t make engines for airliners. Yet they advance. “Intellectual property rights” matter because Washington will do anything it can to cripple the development of a country of which it is mortally terrified.

Impressive engineering, at least if it works, but not revolutionary. What is impressive is that so many tech advances come rapidly.

• Lenovo ranks No. 1 with most supercomputers on Top500 List

Chinese firm.

• How Does China’s Digital Yuan Work?

Various countries are toying with the idea of digital currency, but China seems most advanced, with several cities now in large-scale trials. Payments will be by mobile phone, with which the Chinese are familiar. It will not be a cryptocurrency, will not use blockchain, and will not require a bank account. This would make it appealing to the billions around the world who have smartphones but no bank account, and would tie them into a sort of distributed virtual China. Transfers will be instantaneous, avoiding the delays of the American-dominated SWIFT system and, at least potentially, allow bypassing of American sanctions. The downside will be vulnerability to detailed surveillance by China. For most people, to judge by online experience, convenience will outweigh concerns over privacy.

The digital yuan is typically Chinese in approach. Beijing decides to do something, figures out how, tests it and, if it works, runs with it. Boddaboom, boddabing, done. America would spend thirty years arguing, Wall Street banks would bribe congress to get control, different companies would squabble over standards, the ACLU would wade in about disparate impact, and conservatives would worry that the digital dollar might contain microchips to make them into communist slaves. (Wait. Maybe it’s vaccines that have the chips to make communist slaves.)

Much more speculative: suppose I go to Cancun, write a story on contract to Xinhua, email it to them, and payment in digital yuan appears in my phone. Being distracted, I might forget to report this to IRS. Let us say that hotels and stores serving Chinese tourists, who are getting thick on the ground, accept digital yuan. I would then be part of an ecosystem opaque to and independent of the US government.

Wilder still: Say that China sends five thousand workers to Zimbabwe to build a railroad, pays them in digital yuan that they can spend in a large company store. Local merchants, wanting some of the lucre, begin accepting the currency and Zimbabwean banks, sensing gravy, turn it into whatever Zimbabwe uses for money, for a cut. It becomes a de facto local currency as it is stable and usable outside of the country. The government might even decide to make it the, or a, national currency since it would be (a) reliable and not inflatable and (b) out from under American control.

But this may be delusional. And anyway, I am sure the Chinese haven’t thought of it.

• Xi sends congratulatory letter on success of 10,000-meter sea trial of manned submersible Fendouzhe

That’s 33,000 feet. This is not Guatemalan engineering. A country that has the technology, money, and curiosity to undertake such projects is likely to be tough competition. China can afford it because it has a for-profit economy while America runs a huge trade deficit and debases the coinage by printing money to support a military empire.

• World’s Biggest Ultra-High Voltage Line Powers Up Across China

(Bloomberg) –” State Grid Corp. of China has started up the world’s longest and most-powerful ultra-high voltage power line from its far northwest to the heavily populated east…The 1,100-kV direct-current Changji-to-Guquan project stretches 2,046 miles… The project… was approved in December 2015 and construction started the next month”

Stories of this sort are not sexy, except maybe to power engineers, but they are common in China and embody a lot of technology. Twelve gigawatts. Another one, kind of techy: “A libaba On The Bleeding Edge Of RISC-V With XT910.” Certainly interesting, possibly important, but too long to go into here.

All anecdotal, but enough anecdotes become a statistic, enough points a picture. Nuff said.

 

Data Science Visualization

 

Here's a superb Data Science Visualization I found on Twitter. It is interesting because it isn't hierarchical in importance and in doing so highlight fundamental parts of data science which are often left in the dark... 

COVID-19 Lockdowns: Liberty and Science (Part-2)

 

 

 This is a very long post which resumes almost everything about a year of Covid-19 so I have divided it into 2 parts. This is part 2.

COVID-19 Lockdowns: Liberty and Science by Ammo.com‘s lead writer, Sam Jacobs, originally appeared in Thought Grenades, the blog at LibertasBella.com.

COVID-19 Lockdowns: Liberty and Science

How Dangerous Is COVID? Not Very.

On the flip side of this are the large number of “COVID deaths” which are actually attributable to some other cause. We’re not talking about an elderly person with chronic obstructive pulmonary disorder pushed over the edge by the Chinese Coronavirus. We’re talking about people who died of gunshot wounds, got into motorcycle accidents, fell off a ladder or had a drug-related heart attack while a police officer kneeled on their neck who were counted as COVID deaths.

We’re talking about people who died of gunshot wounds, got into motorcycle accidents, fell off a ladder or had a drug-related heart attack while a police officer kneeled on their neck who were counted as COVID deaths.

With fat government subsidies for COVID cases, it’s unsurprising that hospitals and other healthcare facilities would diagnose people as having COVID who actually did not.

We know very little about COVID and how it is spread, but here are a few things we do know: First, we know that there are a number of comorbidities that make it far more dangerous, one of which is obesity, which increases the risk of COVID death by a whopping 48 percent. But even that might not be as dangerous as it first sounds: In California where they have had 18,000 deaths, a scant two of these were people under the age of 18, one with underlying health conditions.

A much more important factor is age. A large study conducted on data from cases in South Korea, Italy, China, and Spain, three of the early breeding grounds for the virus, found a 0 percent death rate for those under the age of 9, The death rate didn’t climb above 1 percent until the age of 50-59 — and then only in China and Italy and then only just barely, at 1.3 and 1 percent respectively.

It climbed slightly above 1 percent for all four countries in the 60-69 age bracket, staying below 2 percent in South Korea and Spain, but below 4 percent for Italy and China. Death rates then spike dramatically over the age of 70.

This tracks with flu deaths over the 2017-18 “flu season” in the United States: Very few deaths under the age of 18 (a little over 600), slightly more for 18-49 (2803), another modest jump between 50 and 64 (6,751) and then a huge spike over the age of 65 (over 50,000). Of course, there are more cases of the flu, which has a lower death rate overall: The overall death rate for COVID-19 is 1.5 percent, regardless of age, with an average season’s flu killing about .1 percent of everyone who gets it.

Closer to home, we’re finding that there’s absolutely nothing to be concerned about for most healthy people. The COVID survival rates according to the CDC are 99.997 percent for those under the age of 20, 99.98 percent for those between the ages of 20 and 49, 99.5 percent for those between the age of 50 and 69 and even 94.6 percent for those over the age of 70.

These numbers include people with comorbidities such as respiratory diseases. And even these numbers are likely off, as only 6 percent of all COVID deaths are attributed to COVID alone. The rest had, on average, at least two comorbidities.

The average death rate annually for the flu is about .1 percent.

It’s worth noting that this data all comes from the early stages of the pandemic when medical professionals had little way of treating the disease other than ventilating — and thus, probably killing — severe cases.

Now we know quite a bit more about therapeutics that aid in recovery. President Donald Trump, a clinically obese 74-year-old man, recovered from the disease in less than a week. There is ample evidence that the disease is becoming less deadly, not more. Death rates fall because of increased testing, but the median age of infection has likewise gone down.

Do Lockdowns And Masks Even Work?

All of this raises an important central question: Why do the elderly, those with underlying health conditions and the obese simply sequester themselves or take reasonable precautions rather than shutting down the world economy?

Indeed, there is mounting evidence that government intervention has, surprise of surprises, actually made things worse. As of November 18, 2020, there have been 34,058 COVID deaths in the state of New York. Of these, over 6,500 (or approximately one in seven total deaths) were nursing home deaths that were a direct result of Governor Andrew Cuomo’s policy of forcing nursing homes to accept COVID patients and lock them down with the vulnerable and uninfected.

This is a concrete example of government lockdown measures killing people. But you won’t hear about it in the controlled media.

What about the omnipresent masks that we are now seeing everywhere to the point where someone without a mask is seen as the strange one. They must work, of course!

But there is scant evidence that masks prevent the transmission of COVID or any other respiratory infection. In every randomized clinical trial ever conducted, there have been inconclusive findings that mask wearing aided in suppressing transmission of respiratory diseases. Studies generally rely upon fitted N95 respirators that must be sterilized after every use or surgical masks that should be thrown away. We have more evidence that typical masks cause headaches than that they prevent against COVID.

Compare this to what you see on your average trip to the grocery store: People wearing unfitted cloth masks that get occasionally cleaned — maybe. Many people don’t even bother to pull them up over their noses. Thus, most mask wearing is useless and little more than a form of social control or forced act of “solidarity.”

There’s magical thinking involved in the current mask mandates: If cases go up, it’s because people weren’t good little boys and girls and didn’t wear their masks. If they go down, everyone has been well behaved and gets to pat themselves on the back for wearing their face diaper.

Some evidence suggests that masks make people feel magically protected from the virus and thus they do not take common-sense precautions against all disease, such as handwashing, keeping fingers off the face, covering their nose when they sneeze and the like.

What this means at its root is that people are trading effective measures for ineffective theater. Mask reuse likewise increases infection rates and who among us isn’t guilty of that?

What’s more, studies suggest that people who wear the cloth masks, that are now virtually required to do anything outside one’s home, lead to an increase of flu-like symptoms — and thus create lots of COVID paranoia where there ought not to be any.

It was only in March that many experts were urging people not to wear masks at all, with this article from April likewise urging people to not wear masks.

There are also the “soft” effects of mask wearing. There is significant evidence to suggest that children living under COVID will have their emotional and psychological development severely stunted and warped thanks to mask orders. As if you needed another reason to pull your kids out of public school.

Indeed, we have a mountain of troubling data about the social effects of mass mask wearing that go back decades. Put simply, masks make people stupid, pliant and anti-social. Examples of findings from mask studies include:

• A 1976 study where people were more likely and required less pay to carry a sign reading “masturbation is fun” if they were masked.
• A 1979 study found children were more likely to take more than their allotted amount of Halloween candy if they were masked.
• A 1989 study found that masking led people to abandon defense mechanism and revert to more primitive psychological states.
• Studies conducted in 2005 and 2017 found neurological evidence inhibit both impulse control and identity formation, decreasing prefrontal cortex activity.
• Repeated studies have found that masking reduces blood flow to the brain.

A number of public figures have backed off of masking as a panacea, instead pushing it as an act of “social solidarity.” Sure, masks might not actually do anything — but what about feelings? British politicians Michael Gove and Nicole Sturgeon are indicative of this trend.

Your Social Betters Are Not Actually Afraid of COVID

But perhaps the best evidence that this is all just a bit of political theater is seeing how our media and political class actually behave when they think no one is watching.

Chris Cuomo, brother of Governor Andrew Cuomo, often referred to as “Fredo” due to paling in comparison with his brother, was quarantined for two weeks, not for abstract reasons, but because he was actually exposed to COVID. This didn’t stop him from leaving his house unmasked after he got tired of lifting fake weights on camera.

Bill De Blasio, the Mayor of New York with questionable connections to Communist organizations and a daughter in Antifa, was caught at the gym and didn’t feel even a twinge of shame about it, explaining that he needs to go to the gym, but you do not.

Lori Lightfoot, Mayor of Chicago, told Chicagoans to stay home for Thanksgiving. This didn’t stop her from taking to the streets following Joe Biden’s ersatz “victory” in the 2020 Presidential election to celebrate.

Gavin Newsome, Governor of California has presided over some of the harshest lockdowns in the nation, going so far as to shut off power and water to people who defy his lockdown diktats. He somehow finds time to dine out at the three Michelin star restaurant French Laundry with some of the top medical bureaucrats in the state.

He’s not the only governor who believes in “lockdowns for thee, but not for me.” Gretchen Whitmer from Michigan went as far as to threaten lockdown protesters with further lockdowns because of their protests. She is a bit of a poster child for the mediocre people who have appointed themselves COVID cops.

Whitmer put in some of the most restrictive lockdowns in the country, then attempted to use them to blackmail Michiganders into voting for Joe Biden. In November, she began threatening jail time for businesses who did not record personal details of their customers for her personal perusal. Her husband attempted to throw his weight around to get his boat moved into place for vacation early in violation of state orders.

Nancy Pelosi’s lockdown-violating haircut is well known. Less known is that she planned to carry on with the reception dinner for new members of Congress until her plan was exposed and widely mocked at a time when she and other political elites were telling average Americans to skip Thanksgiving and Christmas.

The elephant in the room, of course, were the BLM riots of the summer of 2020. In cities such as New York, Portland (where riots literally went on every night for months), and Seattle (where insurrectionists took over several blocks of the capitol district and demanded ethnic cleansing of whites from the area), there were leftist riots growing out of a media manufactured panic centered around the death of George Floyd, a criminal who died of a drug overdose while resisting arrest and whose death is officially listed as COVID.

These riots were fine, indeed necessary and it wasn’t just politicians who were saying so. The medical profession also chimed in, predictably declaring that “racism” was the “real pandemic.”

Compare with the reaction to anti-lockdown protests. Those seeking a consolidation of power upward in the form of breaking police unions and disbanding local police departments, who terrorized small businesses and local communities, not just in big blue cities, but also in places like Kenosha, Wisconsin and Lancaster, Pennsylvania — the latter of these sensibly held rioters on $1 million bail.

The message is simple and clear: Freedom fighters are superspreaders. The freelance goons of government repression and Big Tech labor discipline enforcement are free to do as they will. Their “protests” aren’t just safe, but vitally important.

The Coming COVID Police State

There is no other term for the COVID regime than a nascent police state. Governors and bureaucrats, without any legislative authority have demanded that people remain in the homes at their personal whim for a disease with a 99.9% survival rate.

Australia is an example of a country that has moved very firmly and decisively into police state territory. Zoe Buhler, a 28-year-old pregnant mother was arrested, handcuffed and had her electronic devices confiscated for the crime of posting about an anti-lockdown protest on Facebook in a town with four active cases. The name of the crime? “The planning and encouragement of protest activity.” The punishment? Mrs. Buhler is looking at 15 years in prison.

You can watch the video of Mrs. Buhler’s arrest here. It should make your stomach turn. The Premier of Victoria (equivalent to the governor of this Australian state) allowed and encouraged BLM protests of up to 10,000 that summer.

In Victoria, as elsewhere in Australia, as well as in many American states, people are not allowed to leave their houses except for reasons deemed “essential” by their government, then only for so long and between certain hours and you might need a hall pass explaining to officers where you are going and why you are going there.

Among people harassed for the crime of sitting down on park benches include a law professor with cerebral palsy and her 70-year-old mother and a heavily pregnant woman while a young tradesman was harassed and fined for not having his papers filled out properly.

With new lockdowns rolling out that involve requirements to wear masks in your own home and a prohibition on all visitors, it is clear that some are attempting to bring back the bad old days of Spring 2020, but with even more restriction and enforcement.

Thinking about protesting? Forget about being arrested and manhandled by police. If your protests get too large, as they have done in Germany, the police will turn fire hoses on you like you’re in Alabama in 1956.

And then there’s the prospect of the vaccine, two versions of which will soon be available, if not mandatory.

Could the coronavirus vaccine be “the Mark of the Beast?” One doesn’t have to be religious to see it as such. Public health officials are already boasting that no one will be able to work, travel or go to school without this vaccine that was rushed through approvals for political theater.

Former Vice President Joe Biden hasn’t ruled out making the vaccine mandatory, though the federal government will likely just punt enforcement to large corporations, similar to how they use Big Tech to manage information on the Internet and Big Finance to take banking services away from dissidents.

Bill Gates has called not only for mandatory vaccines, but also mandatory tracking of people who have received them.

It’s worth noting that “asymptomatic transmission,” the notion that people who don’t know they’re sick are passing the disease around and thus, the entire basis of mask mandates and lockdowns, is patently false.

Are our elites deliberately conspiring to instill fear or are they just idiotic dupes? Probably a little from Column A and a little from Column B. But one thing is clear — the economic, political, academic, and media elites in this country are using a disease with a 99.9% survival rate to transform the country into a police state. Patriots and freedom lovers must resist this by any means necessary.

One way to do this is by patronizing local businesses who are openly defying mask mandates. But in many cases you can circumvent these laws — particularly at big box stores — by saying :”I have a health concern.” The law prevents them from asking anything further and risk averse large companies generally won’t for fear of a lawsuit or an Americans with Disabilities Act or HIPAA complaint.