Sunday, September 18, 2005

Well the fuel protests failed, but what next?

This week we definitely saw my predicted failure of the fuel protests in Britain. This was due to a number of factors.
1. Lack of active support, notably not from the farmers.
2. A stricter police handling of the situation, preventing total blockade of the motorway only allowing lorries on the outer two lanes, and a faster minimum rolling speed of 40 miles per hour.
3. Lack of popular support for three reasons
A. The fuel tax has not been raised so protest against the government was not an appropriate action.
B. By the time the protests happened, the price of petrol and diesel was falling. Several supermarkets, led by ASDA, announced price cuts.
C. Many people realised that businesses were in trouble anyway because of the high price of fuel and any further raises would have damaged the economy.
Interestingly the panic buying of the public increased the price of fuel higher than the effects of the protest. Has BP thought of setting up a secretive organisation which can in future threaten the nation's petrol supply?
The supply and demand problem is being identified by the chancellor as the cause of the rises. I would argue against this as distribution capability is near maximum at the moment, not helped by the destruction caused by hurricane Katrina in the Gulf of Mexico. It is not simply a case of pumping more oil through pipelines, but of expanding production. Here, several countries can take the initiative to gain greater exports. Russia is an obvious winner, with its economy heavily dependent on oil. Venezuela too can take advantage of the American market now the Gulf of Mexico production is decreased. If OPEC will not raise output, then these countries can take the initiative to respond more quickly to the demand.

What to expect in the future?
It has long been said that resource wars will be fought, or have been fought in the case of Iraq and Afghanistan, as the global economy seeks to cope with increased demand for resources and their decreased abundancy. These wars will rarely be military however. They will be economic and political in nature, possibly social as well. We can expect to see more actions against, firstly, governments to liberalise economic accessibility of resources, for example the fuel protests, if water availability decreases then the protests will be over water. Gas price rises also are indicative of a similar action. Notice last week how British Gas tried to sneakily raise prices while everyone was concerned with petrol, England had won The Ashes and it was a glorious summer's day, not the time to show pensioners complaining about, how they were they going to keep warm in winter?
Secondly this action against governments will transfer onto the international scale. Treaties often claiming to be liberal and free trading will be signed, aimed at guaranteeing resource supply and production. This will be done as part of the WTO but also as part of international organisations like the EU and NAFTA. Also treaties will be signed increasingly on behalf of these organisations. The United Nations will be reduced to a disater relief organisation, acting only when the econmic forces of the global economy fail a country. It will become a safety net catching those plummeting to destruction, or a sanctioning body for invasion to secure resources.
However, I do not think that overall that this will lead to global economic blocks of trade and resources. Different networks will be created controlling each resource. these will not consist of states, but of companies and their subsidiaries, states will aim at controlling these companies in their own borders but will lose more power than they have at the moment in trying to retain these company's sevices.
I do not see this future as being bleak. Other social factors will inevitably arise to change this economic pragmatist's view of the global future. The prediction is one according to the West, the way they will want it to be. However inspired opposition to this situation from countries such as India, China, a collection of African nations. A global civil society initiative possibly could radically change this as charities become increasingly organised to have impacts and campaigns world wide.

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