The Bad Economics of WTFHappenedin1971
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(1) Followers of Howard Odum and Charles Hall would say this was a turning point of the Energy Return on Investment
https://en.wikipedia.org/wiki/Energy_return_on_investment
when there was the peak of conventional oil production in the US with the monetary angle that the system had to change so the that the US and Europe could import large amounts of oil..
(2) Integration of China into the world economy which could be dated to Nixon’s 1972 visit and of course has big monetary impacts, like the above, the answer to the situation was the US having increasing trade deficits while also having substantial inflow of financial investment which made the former possible. (e.g. when money “went” to Saudi Arabia it never really left the U.S., or went to the U.S., because the Saudis kept the money in U.S. bank accounts)
People generally interested in periodization would also be aware that something happened in 1968
https://www.amazon.com/Fire-Last-Time-Chris-Harman/dp/189887...
which manifests in numerous ways, for instance I used to think “Gee there were a lot of books published in 1968” and sure enough I extracted publication dates from the OPAC at an academic library and sure enough there was a definite peak at that time.
"We made an agreement with Ibn Saud that we would give him gold. For every ton of oil we took out of his country we would give him gold. And we did at first. Then we got to be producing more and more and more, and we would try to find more gold shillings to meet the requirements so we could ship another ton. And we had to tell him we couldn't find any more gold. There wasn't that much gold. We had now such an enormous business that we cleaned the world of gold shillings."
From The Prize, Part 5: Crude Diplomat, at 31:24.
<https://yewtu.be/watch?v=k7g5UMxDZIg&list=PLYkO4hiKyrSRjZLQu...>
In: <https://news.ycombinator.com/item?id=37490086>.
Goldbugs and Austrians tend to assert that monetary devaluation feeds economic disruption. My argument is that it's the reverse: extraordinary economic demand, debt accumulation, and balance-of-trade imbalances drive* currency devaluations. This is most evident in the devaluation of specie-based currencies, such as the decrease of silver purity of the Roman denarius from 99.9% to less than 4%: <https://www.sciencedirect.com/science/article/abs/pii/104458...>.
I'd argue that the 1971 transition had less to do with EROEI than it did on more traditional balance-of-trade dynamics, but that yes, US mainland oil production did peak in 1971, and that peak was a harbinger of higher EROEI costs to come, as evidenced through oil extraction in Alaska, shallow-water off-shore in the Gulf of Mexico, deep-water, and oil and gas shale and tar-sands. But thanks largely to the vast (and cheaply-extracted) reserves of Saudi Arabia and other Persian Gulf states, those developments were largely offset by decades.
Still, energy costs for American manufacturers and the public exploded fourfold virtually overnight with the 1973 oil embargo, and were driven even higher by the 1979 Iranian Revolution. That impacted heavily on the ability to support high-wage industrial activity in the US, and many subsequent trends including offshoring of manufacturing, decimation of unions, financialisation of the US economy and especially sectors such as housing and real estate, etc.
Which the Austrian explanation answers quite poorly.