Friday, April 8, 2016

Book Revew: “The Third Curve” – by Mansoor Khan

If you are below 40 years of age then you are likely to face this monstrous problem in your lifetime. If not, no less than certainty our children will surely see the day-with-no-oil.

Daily, we hear thousands of statements about this phenomenon called ‘Growth’. We are now conditioned to believe that growth is a natural reaction of society. When growth becomes our religion, we choose governments, ideas and all notions that support the concept of ‘never-ending growth' then the author shakes our consciousness to portray the sustainability of the concept.
If ‘never-ending-growth’ concept is seen as sustainable the question arises, for how long? Mr Mansoor Khan has tried to provide us the lens to understand the inversion of economic reality. It identifies the root cause of the malady by reminding us of forgotten relationships between money and energy, capital and resources and reality.

Though ‘Oil-Peak’ has been discussed here with great extent but the foundation of this book is laid on the ‘Unsustainable-Concept’ of exponential growth with exhausting natural resources. In spite of using heavy graphs and big numbers, Mr Khan, very aptly used an analogy to understand and realize the depth of the problem.

Part-1 states the story of ‘The Coach and the Runner’. The coach has a concept which he claims can make you the runner, run at the speed of sound in just 18 months.
‘How is that possible’, you wonder.
He explains, ‘Can you run at 10km/hr?”
‘Yes, of course, that is slightly faster than walking’.
The logic game goes further. ‘Then you can run 7% faster at 10.7 km/hr, right?’
‘Sure’, you agree.
‘After three weeks, you can run 7% faster at 12.25 km/hr?’

The coach promises that you can run 7% faster than last week every week. In this way, it will take 18 months to break the spead of sound. Awesome!

The coach approached the sponsors and display encouraging charts, supported by descent logic. Picture is rosy so sponsors are ready to pay money and training starts. In phase 1, you ran 7% faster, sponsors are happy, and all is going well as per the plan.

In phase 2, you fail to run faster at same growth then your coach puts you on steroids and you are able to run little faster, say 3% or 4%. Bur in phase 3, you collapse.

Here comes the explanations of the first two curves; the first curve is the exponential curve, that is desired speed (goes to infinity) and second curve is bell-shaped curve which is actual speed (body). The concept (mind and desires) i.e exponential curve goes to infinity, the same way we think about economic growth. We are convinced that our current concept of infinite economic growth will keep the growth as it is. The reality (body and resources) can be seen in bell-shaped curve which has start, rise, peak, downfall and end. All natural resources including oil follow the bell-shaped curve; we started using, increased production, reaches peak, slow down production and finally finishes.

 Our demands from the nature follows the exponential curve, isn’t it?. Can we afford to live without the idea of growth? A big question for all of us.

We are positive people, sorry extremely positive people filled with creativity so we find the alternatives, we think. ‘Oil Peak’ has always been the burning issue since early 90's but the truth of the matter is oil production follow bell-shaped curve. Ever if the peak is shifted, the decline is inevitable. Many of us or our children will face the consequences of oil-depletion.

‘The third Curve’ nicely explains the fragile financial system which sits on the idea of greed and desire of ever-increasing economic growth. When historic money data is blended with oil data then it clearly shows the exponential curve of money that all the governments are producing. The historic oil data follows the half bell-shaped curve. Experts say that we are at the Oil Peak and oil will be produced lesser and lesser in the coming future.

Just because to protect this economic growth the current human generation has compromised everything; Natural Capital (natural resources), Ecological Capital (forests, rivers and animal kingdom), Social Capital (bond of family), Cultural Capital, Spiritual Capital (honesty, trust and peace).

The third part of book check the sustainability of the alternative sources of energy. Here alternative sources are seen as ‘A Mirage of Hope’ which is elaborately explained with graphs and ideas. All alternative sources (like wind, solar or nuclear) and ideas (like technological advancement and energy conservation) have to be viewed in the perspective that it is going to replace the oil, which is the backbone of the current economic model. Alternates have to be very strong to take that place, merely presenting the rosy picture of alternate ideas in some conferences do not serve the purpose.

For the same, the author tested all the ‘Hot Alternatives’ on five technical parameters which are called Energy Rules. These are; Rule #1 Net Energy, Rule #2 Oil Dependency, Rule #3 Energy Density, Rule #4 Scalability and Rule #5 Oil-by-Product.

Unfortunately none of the alternative sources passed the test to replace oil. Let us understand with an example, if we take Wind Energy, it fails Rule#2,4 and 5. Wind energy is intermittent, low density, expensive, oil dependent, has limits of scalability and generates only electricity. It is sorely dependent on Government subsidies for viability. It can never keep the Modern Industrial World running the way it is on oil. Same is with Nuclear energy, it fails Rule# 2 and 5.

There is no escape unless we change the concept of growth. This has been explained in the fourth part of the book which is ‘The Third Curve’. The third curve is called ‘The Eternal Rhythm of the Universe’. It synchronizes with the nature and its resources. It is not a question of how much energy we can find and burn in an illusion of success and progress, but is a question of how much we should.

The third curve of a living earth faithfully follows the rhythm of our primary energy provider, the Sun. Reliably it rises, peaks and ebbs only to rise again. Nothing going to the sky and nothing going to the zero. We are reluctant to accept the truth, the author says that we have two paths; denial or acceptance of Peak Oil.

The part through denial can certainly extend our moment at the top but a chaotic collapse is certain. The path through acceptance can immediately start a soother, longer and managed energy descent, which involves re-alignment of our economic paradigm.

Last and fifth part of the book focuses on ‘Rebuilding a post oil world’. In this modern industrial civilization, the collective belief so far has been ‘big is beautiful, more is good, individualism is prime etc.’ All this led to a particular kind of social structure and lifestyle.

Author urges that we now have to believe personally that ‘small is beautiful, less is good, local is important, community is strength and diversity is paramount.’ This amounts to a huge shift in our cultural perspective. Not easy but then we are not talking about ease, we are talking about what is likely to work in an energy declining world.

The book is very inspiring and captivating. You can certainly digest the heavy stuff with ease as author left no stone unturned to keep its presentation precise. Coloured graphs, clear diagrams and good quality pictures are augmenting the effect of the high quality research work of Mansoor Khan.

By the way, Mansoor Khan is an alumni of IIT Madras, Cornell University, and MIT, Boston. He started his career as film-maker and made his directorial debut with Hindi film ‘Qayamat Se Qayamat Tak’ in 1988. His other famous films are ‘Jo Jeeta Wahi Sikandar’, ‘Josh’ and ‘Akale Hum Akele Tum’. Hope you will enjoy reading this book.

Key Words: False Money, Pseudo-Assets, Financial Jugglary and Proliferation effect.


Rahul Chaurasia said...

WoW!Good Analogy, by the time duration for the third curve to take its course seems also to be infinite in comparison with average age we live today. Also at present we are prey of time so its good to live with "The Mirage". Hope I got the basic theme correct.As history has shown "the need had caused invention" and Law of conservation of energy also exist so if the third curve happens something new is likely to be created so why keep on living this life through all generation. Let the new basics comes, new rules to take place, new creation to happen. Ha Ha Ha.... Why to preserve old and ask our future generation be dependent on this silly things oil, money, natural and natural things. let all gets finished and new thing happen. let the new life is dependent on 70 percent sea water and then guess what the same new chain starts but this time not oil its water. Ha Ha Ha sounds crazy but still I feel its cyclic start peak end and again start peak end. if not do let me know so that book can be read in depth.

Rakesh said...

Thanks for your insight Rahul!
We are addicted to short-sightedness, our only wish is 'This Moment Should Pass'. We think this moment is more painful so let it go and we can manage something in future. Unfortunately, this is not true when it comes to natural resources. As you rightly said " water this time not Oil..', why we are facing water problem is it natural problem or man-made? we need to think. Nature is very tolerant but it too have the limit. We keep on doing so many things to get 'Growth' without thinking about the sustainability.
For ex. GDP of all nations is $50 Trillions, Global Industrial Production in last 100 years is $100 Trillions and worth of TOTAL WORLD DERIVATIVE IS $1000 TRILLIONS. Do you think its sustainable? If yes, then for how long?
Somebody rightly said 'Deal with Reality or Reality will Deal with you' :)