Why U.S. GDP Hasn’t Really Increased Since 2000

While official sources forecast U.S. Gross Domestic Product (GDP) to surpass $20 trillion this year, the real figure is probably much less.  So how much less is real U.S. GDP?  Well, that depends on how it is measured.  If we factor in energy consumption and the increase in total public debt, U.S. GDP is likely less than half of the current figure.

Yes, it sounds insane to say that the current U.S. GDP is likely overstated by at least 50%, but if we go by fundamental data, it isn’t that crazy at all.  Unfortunately, Americans have been conditioned to believe that money grows on trees and energy comes from the Wizard of Oz.  Thus, if we need more money, then the U.S. Treasury can print more Federal Reserve Notes, or we can swipe the credit card.  And, if we need electricity, we just switch on the light.  Easy… Peasy.

Due to the highly complex nature of the world in which we live in today, the individual is clueless as to the tremendous amount of energy and work that it takes to produce the foods we eat and the goods, energy, and materials we consume.  So, it should be no surprise that U.S. GDP can be overstated by 50%+.

If we go by the data that shows the growth of Global GDP is related to the growth of Global Oil Supply, then it is very quite easy to spot inflated GDP figures.  However, you have to be able to understand this essential ENERGY=GDP relationship.  Of course, this is not taught in business or economic classes in high school or college. Instead, the economic teachers focus on the insane theory of SUPPLY vs. DEMAND.  If individuals are taught GARBAGE, then their thinking and reasoning is GARBAGE.  So, we really can’t blame them.

In looking at the following chart by Gail Tverberg, the increase in Global GDP corresponds to the rise in Global Oil Supply:

As the annual growth percentage of World Oil Supply declined in the periods shown in the chart above, the same trend took place in World GDP.  If we can understand the OIL-GDP relationship figures in the chart, then it is impossible for a country to grow its GDP if it does not increase its energy consumption.

A perfect example of a country that increased both its energy consumption and GDP, is China.  We can clearly see that as China’s total energy consumption increased from 2000 to 2011, so did its GDP:

Furthermore, as China experienced double-digit annual increases in energy consumption between 2000-2008, its GDP also enjoyed double-digit growth.  However, the same thing can’t be said for the United States as its GDP nearly doubled since 2000 while total domestic energy consumption remained flat:

In 2000, the U.S. consumed a total of 98.8 Quadrillion BTU’s (Quad BTU’s) of energy to produce $10.6 trillion in GDP.  Amazingly, in 2017, the U.S. only burned 97.9 Quad BTU’s to generate $19.4 trillion in GDP.  It seems as if the U.S. economy has figured out some magical way to consume less energy to produce nearly double the GDP.

Now, if we look at U.S. energy consumption from 1960 to 2000, we can clearly see that it increased along with the GDP.  However, something changed after 2000 as U.S. GDP continued to grow while energy production remained flat or even declined.  So, it seems as if the Energy Wizard of Oz stepped in and did his magic to produce GDP out of thin air.

It’s really quite hilarious to watch supposedly intelligent economists on CNBC and Bloomberg discuss rising U.S. GDP without factoring in energy consumption.  Now, some individuals are going to claim that the U.S. economy has become more efficient with its energy consumption, so it was able to double its GDP.  While this sounds like a plausible explanation, unfortunately, the EROI – Energy Returned On Investment of U.S. energy supply has been falling considerably since 2000.  Which means, U.S. energy efficiency is going in the opposite direction… getting worse, not better.

Now that we understand that a country needs to consume more energy to grow its GDP, that’s only part of the story.  It’s one thing to bamboozle individuals into believing GDP can increase while energy consumption remains flat, but another thing entirely to do so as public debt explodes.

Since 2000, U.S. GDP has increased from $10.6 trillion to $19.3 trillion while total public debt skyrocketed by a staggering $15 trillion:

To put it another way, U.S. GDP increased by $9 trillion over the past seventeen years by adding $15 trillion worth of debt.  Not a bad deal.. ah?  So, not only has the Energy Wizard of Oz allowed U.S. GDP to grow while energy consumption remained flat but we must have had some help with the massive increase in debt by the Tooth Fairy.

As Americans continue to move blindly towards the coming ENERGY SENECA CLIFF, there’s going to be a real surprise when ILLUSIONS are replaced by REALITY.  

Lastly, for all the professionals, individuals and bloggers who think they are really smart by claiming “This time in the stock market is different” or “Peak oil or the EROI don’t matter,” it’s time that you expand your knowledge and wisdom.  If society has any chance of transitioning from the coming Energy and Economic Collapse, it will only do so if adults stop acting like children and grow up.


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86 Comments on "Why U.S. GDP Hasn’t Really Increased Since 2000"

  1. While this sounds like a plausible explanation, unfortunately, the EROI – Energy Returned On Investment of U.S. energy supply has been falling considerably since 2000. Which means, U.S. energy efficiency is going in the opposite direction… getting worse, not better.
    I get this to mean that it takes more investment to get the oil out of the ground. BUT regardless of cost, that barrel of oil is still doing the same work it always has if not more because we have become more efficient.
    That’s just my take, I could be ass backwards…

    • Paul,

      If we also consider the THERMODYNAMICS OF OIL PRODUCTION, then the actual energy making its way to the market is declining. We just can’t COUNT BARRELS anymore. We also need to consider that amount of energy in that barrel that gets to the market. If the Total Oil Producing System is consuming more energy to supply the oil to the market, that should not be counted in the GDP either.

      What’s the use if the Oil Industry grows by two or three times if the energy that gets to the market falls in half?


      • Gotcha,
        Thanks Steve

      • Steve, I definitely respect your work. One of the counter arguments is that “they” will say that the U.S. transformed itself into a predominantly 80%-85% SERVICE economy which does not require the energy consumption that a 80% Manufacturing economy would like China or the old U.S. So, it’s how one would measure/calculate GDP from a Service economy. One can calculate how they want to get the desired number. So, Steve, you would have to debunk the service economy GDP numbers, how they calculate it, and why it is wrong. I would like very much for you to do this.

        • Fred,

          If we understand that CONSUMPTION cannot continue to occur on a sustained basis by adding DEBT, then our SERVICE-CONSUMPTION based GDP should be even lower in real times versus a MANUFACTURING GDP ECONOMY. We must remember, we need the energy to produce economic activity. We have been consuming more energy than we produce for nearly 50 years by importing oil and exchanging it for IOU’s and debt.


    • https://research.stlouisfed.org/publications/review/2018/02/13/is-bitcoin-a-waste-of-resources
      Here is a laughable paper spun the Fed. It refers to the cost of goods and services as being the result of the elasticity of the supply of money. These people actually believe they can move macroeconomic results with money printing. Even worse, they refer to physical currency ($$$) as being decentralized! LMMFAO

      Using the income approach to GDP, you have to wonder where the Fed gets their depreciation stats from? Something stinks there, too. Of course, if the price of your new pickup has doubled in the last 20 years, obviously this will reflect the GDP. This is where the ridiculousness of the chart in the link above comes in. How could the cost of autos that has doubled in the last 20 years be considered stabled and falling?
      It’s amazing how much currency the Fed spends on these people that write these papers that proclaim just how inefficient the alternate forms of transactions are, and how perfect the central banking system is? But that can’t figure out why the wealth disparity is at record highs? What a joke…

  2. There’s also going to be a huge surprise for Americans when the, “Seneca Cliff” in Health Care comes into focus…wanna talk about –reality?
    Steve it isn’t widely known, and NEVER mentioned in the MSM, but Drug shortages are off the chart…. for the better part of half a year now, from simple items like Sodium Chloride to iv pain meds like Dilaudid and Fentanyl, to Diltiazem and on and on the list goes…. and nobody knows… it’s so f’ing hush-hush because the public would totally freak if they understood how bad it is.

  3. To be fair, a dollar of GDP is a per annum number and a dollar of debt doesn’t care about the calendar. So $15T of debt has added the sum of all growth over those years through $9T at the end, say, about $60T.

    It’s possible to lose sight of that when plotted on one chart.

    • Stephen,

      While that may be true to a certain degree, each additional year of GDP is based upon the previous inflated year. Furthermore, U.S. GDP cannot increase if energy consumption remains flat. Thus, the increase in U.S. GDP has been based on asset inflation.


  4. Steve,

    I respect your scholarship and I agree with the basic premise of this article. However, I do believe that you are taking a few semantic liberties with the English language. And I believe words and semantics are very important in this day and age.

    I know what you are referring to when you talk about thermodynamics and efficiency. I think its OK to say, “the EROI of oil extraction is not as efficient as it was in the past”. However, one cannot make the blanket statement that “the economy of the US is less energy efficient that it was in the past” (based upon the lower EROI of oil production). This is where you are making an error semantically.

    I haven’t made a detailed study of this, but the US economy is much more energy efficient than it was in the past. Computerization of controls on vast arrays of machines, vehicles, heating, and industrial systems has made them dramatically more energy efficient than they were in the past. This is a very complicated subject, but just look at how many workers have been replaced with machines and/or digital controls, for example. Look at the absolutely huge strides in home and commercial building heating efficiency made since the 1970’s.

    Another thing, you can’t compare apples to oranges. I agree that yes, generally GNP increases must be accompanied by increases in energy consumption, but it not always the same proportion as it was in the past. In the US we have shed a lot of industry and replaced it with services. Services require less energy. As economies “mature” their composition changes and the nature of energy use also changes. As a matter of fact, your graph of the Chinese GDP vs. energy use illustrates this. They have increase their GDP with a corresponding smaller increase in energy use than in the past.

    Look at Switzerland. It’s energy to GDP is lower than the US but it specializes in “low energy” industrial products such as chemicals, pharmaceuticals, watches, high tech machinery, etc. and of course, banking.

    So, let’s say I bought a car in 1999 when oil extraction was more “efficient” and today I have the same car and it still gets 20 mpg. Am I supposed to believe that my car is now somehow “less efficient” now than it was then? That’s the case you are making. No matter how expensive a gallon of gas is, no matter what the production EROI is, this does not change the “efficiency” in my book.

    Also, oil comes from many sources and many countries. It would be a very tedious thing to try and calculate the exact EROI of gas sold at the station when the sources are in the thousands. This would be a big argument in itself.

    Another point you made is about debt. I don’t believe that “debt” has anything to do with “efficiency” really. Let’s say Company A and Company B make the same product using the same amount of energy. They have the same energy efficiency no matter if one has a trillion of debt and the other has zero.

    One more thing, and this is my opinion. Even if all adults “stop acting like children and grow up”, there still is NO CHANCE of “transition”. No matter how well the world prepares, there will be a crash and no “transition” as most define the word (i.e. doing the same with less energy). Some will be better prepared than others, some will survive and many others will perish. Oil and coal are the life blood and there is no substitute.

    Not trying to knock you, Steve. I get it. But sometimes an artist’s brush stokes can be a little broad and ill-defined.

    • Rob,

      While I appreciate your comment, it seems that you do not understand the 5th Law of Thermodynamics. You cannot add more technology to make something more efficient. You fail to INCORPORATE the energy that went into making that technology. This is one of the most misunderstood aspects of technology.


      MORE TECHNOLOGY = less efficiency and the lower the EROI of the overall system.


      • Steve,
        I DO understand and I agree that, IN GENERAL, more tech = less (overall) efficiency. However, some increases technology in certain areas of industry cause huge decreases in energy use which far outweigh the overall energy use caused by that particular increase in technology. Like I said, semantics.

        When one starts applying concepts like “energy efficiency” to business, economics and politics, it starts to get murky. Just sayin’ 🙂 Believe me, I’m on the team, bro!

        I have an idea and challenge for you: Do an article on what I believe to be the fake GDP numbers coming out of China. Can they possibly be increasing GDP faster and longer than everyone in history? What about their energy use? Are their stats accurate?

        • Rob,

          While it seems as you say, that “SOME” increases in technology will cause decreases in energy consumption, it can’t be true if you agree that MORE TECH = LESS EFFICIENCY. We can’t have it both ways.

          Again, according to the 5th Law of Thermodynamics, the level of INCREASED TECHNOLOGY comes from the same level of INCREASED ENERGY CONSUMPTION.

          Yes, China is overstating its GDP as are the majority of countries.


        • Rob
          Aside from their energy use; the GDP numbers coming out of China as far as I am concerned are irrelevant. The west makes a big deal out of this BUT most of the banks in China are state owned. They can damn well do what they like.

          Ellen Brown wrote a good article on this recently from “Web Of Debt”

      • WHAT? the >#&(%^#@ The 5th law of Thermodynamics???

        In the laws of thermodynamics, the fifth law of thermodynamics is any of a number of various, yet unsubstantiated, postulates, theories or (sometimes) humorous statements positioned to explain facets of physical phenomenon or existence;

        You made that one up. Or you need to do a better job of explaining the illogic of it.

        • Antler333,

          Come on, do a bit of thinking for yourself. Here is what the new FIFTH LAW OF THERMODYNAMIC STATES:

          “No device can generate energy in excess of the total energy put into constructing it”.

          Thus, the silly idea that more TECHNOLOGY increases efficiency is untrue because each level of technological complexity consumes an ever-increasing equal amount of energy.



          • Ahhh, a new 5th law …still being adjudicated.

            “No device can generate energy in excess of the total energy put into constructing it”.

            Well, duh, that makes sense, hence you can not get a perpetual motion machine. But that does NOT apply to a device (technology) using pre-stored energy like a locomotive burning coal or a geothermal recovery system, nor to a device (technology) that can reduce the energy consumed and then perhaps make use of energy normally lost to the environment during the conversion, as like a heat exchange system.

            Hence More TECH does not = less efficiency. Even the energy for the creation of devices (Technology)will eventually be recovered through the savings of unexpended energy, or by the recovery of heretofore unused energy. The energy in the system is the same, one just gets more of it converted for less effort.

            Sooo, Your modified 5th MORE TECH = LESS EFFICIENCY aint true. Personally, I like older, better-aged 5ths.

          • Antler333,

            I gather we will have to AGREE TO DISAGREE. It seems as if your mind cannot wrap around the fact that it takes a hugely complex web of supply chains, advanced education, and countless other levels of systems to produce that advanced energy technology. Furthermore, you fail to incorporate the SHORT LIFESPAN of HIGHLY COMPLEX TECHNOLOGY. Thus, the more complex the technology, the shorter it’s lifespan.

            Lastly, there is a quite a bit more WASTE HEAT generated in the higher levels of technological manufacture. This is also not accounted for in the equation by the typical JOE-BAG-OF-DONUTS.

            PERFECT EXAMPLE: Human labor based food production EROI = 5/1. Modern complex Agricultural Food Production System today is 1/10.


          • lastmanstandingb | March 1, 2018 at 7:03 am |

            Don’t feel bad Antler…99 out of a 100 think just like you.

            We’re used to it.

        • Antler333 – The 2nd Law of Thermodynamics didn’t specify when its heat engine will ultimately reach end-of-life and fail but left the freedom for the device to run indefinitely – as long as it obeys the Law, and fuels running it are available.

          The Fifth Law proposes, the engine will ultimately wear and tear and cease, when the sum of all the useful energy it produced edges closer and closer to match the total energy put earlier in constructing it.

          Because the trail of energy-intensive processes involved in creating any energy-generating device today, which includes social order (so nobody steals or bombards the on-going materials buildup or process), technology (what has built furnaces to cast steel, built mining machinery then built engine machinery, etc etc), infrastructure (roads, ships, trucks, bridges), humans (i.e. if all individuals involved were robots, how much energy would have been expended in sustaining and programme them skillful?) and knowledge (know-how, i.e. we wouldn’t be able to build an ICE if James Watt hasn’t developed the steam engine, the Sumerians haven’t put the 60-based time interval, etc) – is so long and vast, The Fifth Law came to existence.

          Not only that, but when all fossil fuels expended in constructing an energy generating device is quantified, the amount should then be multiplied by 10^6, as this is at least how much solar energy was stored in organic materials millions of years ago plus the planetary forces that broken the organic materials into FF, since.

          Don’t change the engine’s oil of your brand new car but keep driving it. It will descend degrading, then fails and ceases. At that point the energy put into constructing it became totally neutralised.

          When that occurs, 99% of its mass and parts-count are still the same when it left the production line, yet the device became entirely useless.

          This is an indication on how little of the energy expanded in constructing the device has been possibly translated into a capacity for generating useful energy.

          The failure occurs regardless of the amount of fuel used, future availability for more, or the level of efficiency processing it.

          Therefore, the energy expended in making a new fresh 4 liter jar engine’s oil available for your car and changed, to avoid destructing it, for example, is greater than all the useful energy the car has produced travelling since last repair.

          It is really traumatic even thinking of mentally-decoupling from energy abundance, yet alone living the experience.

    • I think Rob has nailed it. I have gone back to that classic and brilliant report from the 70s THE LIMITS TO GROWTH and there it is Switzerland as an exception to the energy-gdp correlation. Probably because Switzerland at the beginning of the 70s had already a much service-based economy. The swiss had specialised in very high technology sectors like clock-making and also in the banking services.
      If the USA offshores its industrial production it may increase its GDP while keeping a low energy consumption, even if this shatters the US trade balance. In the long run of course the USA capacity to import from other countries will be much reduced when the dollar loses value. But in this shorttermist world in which we live I think the yankee politicians will continue to test the readiness of the chinese to sell goods in exchange for green papers. As the EROI gets lower and lower the yankees are going to regret having moved so many crucial industries to far countries. Needless to say here in Europe we have done more or less the same mistakes.

  5. Every major monthly US government economic report – employment, GDP, inflation – is little more than a fraudulent propaganda tool used to distort reality for the dual purpose of supporting the political and monetary system – both of which are collapsing – and attempting to convince the public that the economy is in good shape.

  6. Dear Reader,

    Here are five peer reviewed scientific studies authored by top experts that prove beyond any reasonable doubt that global civilization will collapse within the next decade

    Peer Reviewed Study: Society Could Collapse In A Decade, Predicts Historian (Turchin, 2010)

    NASA Peer Reviewed Study: Industrial Civilization is Headed for Irreversible Collapse (Motesharrei, 2014)

    The Royal Society: Peer Reviewed Study, Now for the First Time A Global Collapse Appears Likely (Ehrlich, 2013)

    Peer Reviewed Study: Limits to Growth was Right. Research Shows We’re Nearing Global Collapse (Turner, 2014)

    Peer Reviewed Study: Financial System Supply-Chain Cross-Contagion: Global Systemic Collapse (Korowicz, 2012)

    Simple really….when the World Economy Collapses everything shuts down…the end… We’re talking about grids down all over the world and 7.5B people dropping like f*** flies in short order. The collapse will be absolutely horrible..There is no collapse or horror movie ever produced that has even come close to imagining what the collapse of BAU might look like. I’m talking about every corporation and every social program going bankrupt at once. I’m talking about people eating people. I’m talking about the Worst Catastrophe to ever happen in the history of mankind. Nothing has ever, or will ever come close….

  7. Steve the critics will say we off-shored all of our energy consumption. What do you have to say to that argument?


      I would say that OFFSHORING energy consumption should be treated the same as OFFSHORING a company’s DEBT. Basically, it doesn’t matter.


  8. Harryflashmanhigson | February 28, 2018 at 6:35 pm | Reply

    ‘SENECA’, Steve.

    Ugo Bardi would not be impressed…

    • Harryflashmanhigson,

      Thanks for the spelling correction. Actually, I know UGO BARDI and have had over a dozen email exchanges with him. I also belong to his Google Energy Transition and Peak Oil Groups. I hardly doubt Ugo would be upset at the miss spelling as much as the ancient Roman philosopher, Lucis Seneca, who may be turning in his grave… LOL.


  9. Michael Kohlhaas | February 28, 2018 at 6:52 pm | Reply

    Awesome charts!!! Thank you!!!

  10. Efficiency increases consumption. Once man figured out how to fly in planes. He traveled farther than ever!

  11. Hi Steve,
    what about big companies making money overseas like Apple , McDonald’s etc.
    Is their energy consumption added to total USA energy consumption?
    and then ,what about Big Banks , their profit went up in last few years ,they don’t need much energy ,They need only good manipulation of the Markets to make big money!!!
    World is changing, with global world oil supply going down our jobs going down too.

    • Mark,

      Let me provide you the CORRECT definition of GDP:

      Gross domestic product (GDP) is the monetary value of all the finished goods and services produced within a country’s borders in a specific time period.


      • Thanks Steve,
        I just wanted to know how They somehow come up with $20 trillion figure of GDP. Right now all statistics and data are big joke. Thanks to Globalization ,their power and control is increasing. We have to see another danger coming “Artificial Intelligence” , if nothing changes we are doomed.

  12. US economic growth is all an illusion

    Here’s what a Wall Street hedge fund mogul, Paul Singer, head of Elliott Management Corp., told his clients the other day:

    “Nobody can predict how long governments can get away with fake growth, fake money, fake jobs, fake financial stability, fake inflation numbers and fake income growth,” Singer wrote. “When confidence is lost, that loss can be severe, sudden and simultaneous across a number of markets and sectors.”


  13. The Great Depression 1929-1940 US Economic Growth GDP (1%)

    The Great Recession 2006-2017 US Economic Growth GDP (1.5%)

    World & OECD Economic Growth GDP

    World Governments Gross Debt to GDP (330%)

    *Note: 20% GDP Includes (FIRE) finance, insurance and real estate

  14. *Seneca

  15. What I was thinking was when people talk of today’s increased efficiency they are not factoring in the cost of climate change, or the lower EROEI of oil today, a car running on oil that 50 years ago had a ERORI of 50 to 1 would need to be a lot more efficient today if the oil it using was only 5 to 1 otherwise it is actually less efficient, from the oil well to wheels, or am I barking up the wrong tree.

  16. OK, Here is another comment.

    While GPD may historically be co-ordinated with the oil price. It may not be now ( at least for the last decade only) in the USA for multiple reasons. here are a couple:
    1)GDP is a calculated number…based upon the cumulative value of the services and products of the economy If you inflate the value of a service or a commodity, then WA LA you have a higher GDP value with no additional expenditure of energy (oil). Our burdening debt load seems to suggest a linkage there, and
    2) Some technology actually does save on energy consumption allowing for the creation of a similar number, or possibly more products with less input of energy. Technology then =’s more efficiency…which means less oil while giving more apparent value to the economy.

    • Antler333,

      LOLOL… gosh, you are killing me here with your logic.

      FIRST… I wasn’t comparing U.S. GDP to the oil price, rather to total energy consumption.

      SECOND… you can’t save on energy consumption with technology if it takes more energy to create the technology. You just can’t see the energy being burned in the entire process because the market is so complex.

      LASTLY… Thermodynamics proves we are in serious trouble while NITWIT ECONOMISTS & WALL STREET ANAL-ISTS focus on worthless financial metrics such as GDP and NET WEALTH.


      • OK, humor me.
        FIRST: My flaw, I WAS talking about oil consumption not price as per the later sentences.

        SECOND: I can now see you are talking about Societal values and the evolution of a complex society with its technology and energy use as becoming progressively less energy efficient. To that I will agree, in any society, the more affluent it becomes, the less efficient it becomes with its energy uses.. hence Societal Affluence (SA) = less energy efficiency. Look at us now …entertainment is more important than food and shelter for many, especially those in the investment business. Not good for energy efficiency.

        However, assigning Technology as the proxy of SA is a disservice to Technology, as Tech will go where the consumer wants, damn the energy consequences. It (tech) can be used as a positive or negative influence. I chose to look thru a smaller lens and that TEch can be good. But under your more global scenario, then MORE TECH = LESS efficiency is due simply to the wastefulness of humans in general. The more you have, the more you want, the more you waste.

        LASTLY: I would not say that thermodynamics proves your point, human nature does, but i will agree that economists and brokers need to have talking points, regardless of the cost. They are not very energy efficient.

    • Also please explain what you refer to in this from above.

      PERFECT EXAMPLE: Human labor based food production EROI = 5/1. Modern complex Agricultural Food Production System today is 1/10.

      • Antler333,

        Oh, that’s quite simple really.

        While modern man believes we are more efficient than Hunter-Gatherers or simple Human Farmers, we are not. Why? Because the more energy thrown into the FOOD PRODUCTION SYSTEM lowers the EROI.



        The Hunter-Gatherer was able to hunt and gather 10 calories of food for each calorie of energy he or she burned in the process. When man moved to simple farming, the EROI fell to 5/1. Today, the modern agricultural system with one farmer sitting in a giant FARM TRACTOR with satellite tracking producing food for thousands is consuming 10 calories of energy to deliver one calorie of food delivered to the America dinner plate.

        Now… Antler333… Please tell me how in the LIVING HADES is technology making food production more efficient???



    • lastmanstanding | March 1, 2018 at 7:27 am | Reply

      Brother, do your self a favor and accept the fact that tech is the problem. It is destroying the world. Just not enough benefit for energy expended.

      People like you might as well beg for their chip now.

  17. Shell forecasts global Natural Gas supply shortage in mid-2020s

    Oil and Gas shortages coming soon! This world will burn!

  18. Top Economist: America: the future looks broke

    Nobel Prize-winning Economist Robert Shiller, The stock market today is similar to the market in 1928

    ‘Perfect storm’: Global financial system showing danger signs, says senior OECD economist

    A Nation of Broke People Are Killing Retail More Than Amazon: Top Expert

    Our Broken Economy, in One Simple Chart

    US companies spent $4T buying back their own stock since 08

    Financial markets at risk from bubble, IMF warns

    Global economy set for decade of gloom as World Bank predicts recovery will fizzle out

    Global Debt Hits Record $233 Trillion

  19. Shell forecasts global Natural Gas supply shortage in mid-2020s -NBC NEWS


    2020s To Be A Decade of Disorder For Oil

    Oil and gas shortages coming soon! Oh well, we don’t need to live with heat, light, and motion…

  20. Considering all the comments and discussion, I conclude there must be some painfull truth in your article. Thank you very much Steve.

  21. Northwest Resident | March 1, 2018 at 12:37 am | Reply

    It is so much more energy-efficient to computer-generate your GDP than it is to have to earn it the old fashioned way. Why didn’t they think of this before?

  22. Howe much energy does it take to make an arrow? How much energy does it take to make a bullet? The more advanced the technology the more energy it takes to make it.

    • To clearify what I mean by the arrow, is that the arrow is from the branch of a tree (wood). The bullet is metal with gun powder. Which one takes more energy to make?

      • lastmanstanding | March 1, 2018 at 7:32 am | Reply

        Who cares. They can both be used to keep you alive. Better have both.

        Soon, that might be all that will matter.

        • Who cares? You are completely missing the point. Bullets take more energy to make. The point was not about what keeps you alive. The point was the more advanced the technology the more energy is needed to develope, make, and keep that technology. You seem to be a rude individual.

          • lastmanstanding | March 2, 2018 at 8:55 pm |

            I didn’t miss the point, your comparison isn’t even a rational modern comparison. An arrow actually takes more energy if you have ever watched the entire process. FYI, arrows are metal these days. It is a highly technological process.

            Many load ammo by hand at home. Takes care, patience and materials/supplies are everywhere. Virtually, no one products their own arrows.

            Sorry, didn’t realize that you would be so sensitive.

  23. Steve,

    Clever analysis. There is one thing missing in the equation though, and that is, what is the composition of the “product” part of the cited GDP. In simple terms, China produces THINGS which consumes a lot more energy than the SERVICES the US calls “product” . . . even the debt issue you are rightly calling out as a stupidity, is counted as part of the US GDP.

    • Roger,

      Can you explain what you mean by this “even the debt issue you are rightly calling out as a stupidity, is counted as part of the US GDP.”


      • It is a part of the banking smoke and mirrors hoax . . . as we know, credit is created out of thin air by the banking system. This widely proved in several governmental inquiries (example the New Zealand Royal Commission back in the 1920’s and also in the UK). Until recently, M1 actually recorded/reported “Credit” along with cash and the other elements of money in circulation . . . but the reporting of the “credit” element of M1 has recently been dropped and renamed as “current accounts” because the revealing of “Credit issued” blows the whistle on how banks (including Central Banks) are actually behaving as parasites within our society.
        In the accounting system as practiced by banks and government, that created credit shows as an asset for the banks and as a debt for the borrower. . . . but, in the national economy it shows as an increase in GDP.
        Looking at it from outside the system, one will see the increase of $$$’s value of the GDP as “product” of the “services sector of the economy” versus manufacturing (of things) or agricultural production.

  24. ” If society has any chance of transitioning from the coming Energy and Economic Collapse, it will only do so if adults stop acting like children and grow up.”
    So many varying descriptions of the path we are on, various thoughts and arguments describing this path and how we arrived at where we are. Description of our downfall are a dime a dozen.
    What would really be valuable is a SOLUTION to our destination.

  25. Tore Johansson | March 1, 2018 at 6:58 am | Reply

    My present car is 50% more in weight but also 40% less in fuel consumption than the prior one.
    So u suggest that the energiconsumtion due to developing of that car would spoil all the gains in lesser fuel consumption over the lifespan of my new car.
    Its for sure an challenging statement.

    • lastmanstanding | March 1, 2018 at 8:03 am | Reply

      We have a winner. Tore, at least the words came out of your mouth on an open forum. Brother, please think about what you have just said. It is the answer and it is even beyond the lifespan of your car.

      Anything. I repeat, anything new generally requires new everything these days…in the name of “efficiency.”

      A new plant to build your rig or massive retooling. It takes energy to build the material for the plant/retooling. Takes energy to build the plant, etc. It takes energy to get the materials to the plant. Then you have the product to be built. Energy for parts built at another plant. That plant uses energy. How do those parts get to the new plant?…more energy. I probably missed a lot of energy just in that diatribe…and yet we are just getting started. I think your getting my picture.

      As a former engineer, no one gets it. In fact, NO ONE GIVES A DAMN.

      There is nothing challenging about Steve’s statement. The challenge is for humans to use their brain about how processes work.

      This will continue as long as money can be printed out of thin air and given to the corps. Until then, resources/energy will be wasted recklessly.

      Peace friend.

      • Tore Johansson | March 1, 2018 at 11:18 am | Reply

        Well, all those items u did count is guilty for the old car as well. Still I am left with an new car with very improved fuel efficiency. If the lifespan is 15y it will be about 7000 gal
        Less fuel, in one single car!
        I can hardly believe that amount of energy would be consumed in the development of the car.

        • Tore Johansson,

          You stated this, “I can hardly believe that amount of energy would be consumed in the development of the car.”

          While it seems to make sense that increases in fuel efficiency override the cost of the car, if we understand the LAWS OF THERMODYNAMICS, it makes no sense whatsoever.

          Any increases in the efficiency of automobile mileage come at a cost of EXPERIMENTATION, DEVELOPMENT & HIGHER TECHNOLOGY. All of these factors are not considered by the typical person when they drive their car off the showroom floor.

          Because the system is so complex, you can’t see all these costs. However, increased mileage efficiency comes at an energy cost down the line.

          Now, if we want to THROW OUT SCIENCE and believe whatever we want to… an individual is free to take on that position.


          • Tore Johansson | March 1, 2018 at 12:22 pm |

            Let’s take another example of development : led lamps that in an short period of time has wiped out all other types of lamps due to its very energy efficiency.
            So u mean also this is an meanless development due to use energy in an more effective way?
            This is an technology that what I understand is saving energy big way worldwide this days.
            So that also is an waste of technology as u see it?

          • Tore Johansson,

            Are you just being cute, or are you just being dense? I am not quite sure. This is my last response to you. The cost to produce LED lights is much greater than regular incandescent light bulbs. Furthermore, you still FAIL to understand the amount of energy that went into the experimentation, development, and production of LED lights.

            Please feel free to throw out SCIENCE and believe the WORLD IS FLAT. Because that is exactly what you are doing by disregarding the LAWS OF THERMODYNAMICS.



          • Tore Johansson | March 1, 2018 at 12:32 pm |

            I also just want to clarify that I understand and agree to the terms of EROI.
            But not that statement it is an static correlation between GDP and use off energy.

          • Tore Johansson | March 1, 2018 at 12:44 pm |

            Well, I can’t stop to thruu in an last example: the biggest invention of them all, the wheel. That made human muscle energy more efficiently in a big way.
            Maby eaven producing an wooden wheel did take more energy than it gained?

        • Tore You are absolutely correct. The smaller car takes less energy to build and to run than a big car. Going with the small car is more energy efficient ie. less GDP. Steve is right that real GDP is not increasing in the world and in the USA. He is wrong to bash folks for driving tiny cars or just plain walking. As a kid I wanted a scooter to go to my job like everyone else so to justify it I crunched the numbers and low and behold it would have been negative to my pocket book. Now I could enjoy walking again knowing that I was saving money. Great for my pocket book but DEVESTATING FOR GDP. LED lights produce basically visible light whereas the incandecent produces a wider spectrum comparable to sunlight which is so much better for animal bodies but much of it is in the infrared so it is less efficient in producing visible light.

          • farmlad,

            While I appreciate your insight on the subject matter of SMALL CAR FUEL EFFICIENCY, you are still missing the point.

            FIRST… I never said building and driving small cars was worse than larger cars. What I did say was that using more TECHNOLOGY for increased efficiency for smaller car fuel mileage today versus smaller cars 30 years ago, IS NOT MORE EFFICIENT.

            SECOND… I sure hope you understand the difference in the price of a small car in 1980 at $4,000 versus $16,000+ today creates four times higher the GDP. The higher car price is not based on real GDP increases, but rather by massive INFLATION, DEBT and MONEY PRINTING.


  26. I was right.In a low interest rate phase the FED can plug each hole with hot air money.
    The so called analysts either where payed pumper or had no clue.

  27. WHERE’s RD?

    Hey RD, where art thou? I remember in the previous article on the DOW JONES TANKING, you made provided these HIGH-QUALITY comments:

    RD: Clive maund : another clown who just shorted the stock markets, he will be destroyed.
    Only ray of hope for him, gartman just covered his longs !

    RD: New all time highs by the end of next week.

    RD: FANG reachead another new all time high today, no end in sight for stocks, and even some bonds.

    This is the sort of silly short-term superficial thinking that will destroy the wealth of most people. For some odd reason, RD, you believe THIS TIME IS DIFFERENT… LOL.


    • I am here Sir ! Glad to see someone from another continet is thinking about me !
      Anyway, each time it is the same thing, you are going ino overdrive at each 2% stocks and bonds dip. In the meantime, PMs continue to fall and much more heavily.
      I never said paper markets will go up forever but we cannot know how many years they will continue. What is sure is that if rates are 4% or higher there will be huge cracks but nothing say the central banks will pursue this strategy.
      Short term, it will most surely be the friday afternoon recovery. I also note that bitcoin is back near 11 000 USD…

    • Please find as scheduled the friday evening stocks surge :


      End of the correction.

  28. Hi Steve,
    Great article. I love the blunt ending.
    The Fed chair should be reading your material. In his testimony to congress on Tuesday he was waxing lyrical about how great the conomy was performing. Indeed it was in danger of overheating.

    Sadly, most people just don’t want to know about our energy predicament nor the fact that you cannot have infinite economic growth on a plant of finite resources.
    As James Howrd Kunstler recently said in his blog it will take the coming economic collapse to hit them between the eyes before most people wake up from their zombie like torpor.

    Keep up the good work!

  29. Trump wants to take back the steel industry to the USA.This is dangerous.Maybe 25% taxes for imported steel.He creates a war with china.The steel industry are no peanuts.The reaction from china came immediately.They will fight against this.

  30. Reluctant Motorist | March 1, 2018 at 11:34 am | Reply

    PERFECT EXAMPLE: Human labor based food production EROI = 5/1. Modern complex Agricultural Food Production System today is 1/10.


    What is the EROI of our meat based prodigious diet, i.e. beef? Somewhere I read that most of all corn and soybeans are fed to livestock. Also, how much water does this consume? Would the world be able to provide the same rich diet to, say China, simultaneously?

    • Reluctant Motorist,

      From the data I have seen, FEEDLOT BEEF EROI is 0.06 versus 0.11 for the U.S. Food Production System. Thus, Beef EROI is roughly 1/20.


      • I will venture to say that feedlot chicken and pork is the most devastating way to raise meat. In beef production the feedlot only serves to fatten up the cattle for the last couple months of their lives. Otherwise they are out on the grasslands where they perform very important ecosystem functions. Obviously not a good idea to place cattle in feedlots but not quite as crazy the chicken industry.

        But yes beef are very inefficient at converting grain to meat, Duh they come with a rumen. Feeding a high percentage of grain and other stored feeds to cattle only came into being with the oil age and is fast coming to an end in lock step with the oil age.

  31. Steve, it’s worth checking out the work of Dr Tim Morgan who has computed the numbers. The US economy can be split into two – Globally Marketable Output and Internally Consumed Services. GMO are goods and services which are competitive in the global economy like autos, laptops, steel while ICS are services like restaurant prices, healthcare costs, taxi rides & haircuts that are only local in context. The US cannot compete in the global economy and the only growth has been in selling expensive services to each other. It’s a fake economy.


  32. Steve
    It appears that everyone wants to know unconsciously what will the world be like after the collapse. The only example of a modern day power collapsing is the Soviet Union. One who is VERY familiar with this collapse is Dmitry Orlov; a Russian American. His books are riveting describing the fall of the USSR and life after the fall. Just as Joseph Tainter describes a collapse as only a rapid decline to a simpler life. So too Dmitry explains the simpler life that dominated Russia after the fall. Here is one of Dmitry’s Talks about the life style that survives the collapse https://www.youtube.com/watch?v=Ecfxl1wZDpE

    • Simple really….when the World Economy Collapses everything shuts down…the end… We’re talking about grids down all over the world and 7.5B people dropping like f*** flies in short order. The collapse will be absolutely horrible..There is no collapse or horror movie ever produced that has even come close to imagining what the collapse of BAU might look like. I’m talking about every corporation and every social program going bankrupt at once. I’m talking about people eating people. I’m talking about the Worst Catastrophe to ever happen in the history of mankind. Nothing has ever, or will ever come close….

  33. Thank God the sun comes up in the morning to warm us all.
    We just have to learn to live with it.

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