Oil, energy and capitalism: An unpublished talk by Barry Commoner
“Oil companies do not operate for the purpose of producing oil. They
operate for the purpose of producing maximum profit. To solve the
energy crisis, we have to reorganise our economic system.”
July 30, 2013 -- Climate & Capitalism, posted at Links International
Journal of Socialist Renewal with permission -- Dr Barry Commoner was
the best-known ecologist in the United States in the late 1960s and
1970s. His picture appeared on the cover of Time magazine in 1970, and
his 1971 book, The Closing Circle, was a best-seller and remains a
classic of radical environmental analysis. As this talk shows, he was
also an ecosocialist, before that word was created.
Commoner gave this talk at the Community Church of Boston on February
22, 1976, just before publication of his book, The Poverty of Power,
when the “oil embargo” and energy crisis were still central political
The transcript, which to our knowledge has not been published before,
was found in Commoner’s papers by Philip Wight, a doctoral student at
Brandeis University who is researching the origins of ecosocialism. We
have corrected obvious typos and repetitions, and to improve
readability we have added paragraph breaks and subtitles. -- Ian
Angus, Climate & Capitalism
* * *
Science and political power
By Barry Commoner
I’M GOING TO TALK ABOUT the relationship between science and political
power. I imagine that most of you feel that science is eminently
powerful and that your own relation to political power is one of
weakness. The Berrigans are in jail, people who are still looking for
amnesty—there aren’t many victories that the people can point to in
their relation to political power. So that in certain ways there’s a
sharp contrast between the two things that I’m going to talk about.
Now, let me talk for a moment about the connections between these two
apparently disparate things. First, let’s look at a recent exercise of
political power—a rather supreme exercise—we got rid of Mr. Nixon. I
think you‘ll agree that that was a rather intense exercise of
political power. He had a great deal of it, and he lost it all. He may
be regaining a little in the hands of the Chinese right now, I don’t
How did that happen? If you think back you’ll notice that no troops
surrounded the White House to get him out; it was not done by military
force. It wasn’t even done by legal action. He wasn’t brought to
trial. Nor was it in fact done by any riots; there weren’t many picket
lines, nobody surrounded the White House, chanted.
A very simple thing happened. Some people got at the truth. Facts.
Information… I think it’s clear that it was the work of the
newspapers, largely the newspapers, largely Mr. Bernstein and his
friend, Woodward, that really lost the power for Mr. Nixon. It was
pure information. But it wasn’t just information, it wasn’t just that
Mr. Bernstein and Mr. Woodward got the goods on Mr. Nixon. What
happened was that information that was in Mr. Nixon’s hands, on his
tapes, became known to the public. And very suddenly, he lost the
exclusive possession of certain facts.
When the public had all those facts, there was no longer any argument,
there was no need for any legal force, military force, he knew that he
Science versus secrecy
What I’m saying is that there is a close relation between political
power and the ability to keep information to yourself. Exclusive
knowledge is a source of political power. Now there’s the connection
with science, because science also deals with knowledge. But it deals
with it in exactly the opposite way. It deals with open knowledge,
openly available to everyone. It deals with open discourse about the
And … you may wonder why science is so antagonistic to secrecy. The
reason is that the way in which science gets the truth is by making
its mistakes in public. It’s known as publication. The reason why
scientists have, I think, a justified reputation for getting at the
truth better than some other professions is not that they are more
truthful than other people, it’s simply that we have adopted this rule
that whatever mistakes we make will be known to our fellow scientists.
And we do that simply by making the mistakes, or calculations, or
theoretical statements, are put out where everyone can see, and if
we’re wrong, and anyone can show that: they demonstrate it gradually,
bit by bit, you get closer to the truth, as we argue back and forth.
So science really represents the kind of social action that we see in
Watergate. And what I want to talk about is the way in which
scientific knowledge has been related to political developments, to
political action, in recent years in this country, particularly as
exemplified by environmental issues and now energy issues.
Let me just remind you of a couple of examples of what might be looked
on as environmental victories and some environmental defeats. What I
mean by a victory is that an environmental problem was solved, just
put it that way, that the pollution, the degradation of the
environment, was brought to a halt.
An environmental victory: nuclear tests
The best example I know is the earliest one that many of us were
involved in, and that’s the fallout from nuclear tests. You remember
some years ago when we were exploding nuclear weapons in this country
and in other parts of the world and radiation from that was
distributed throughout the world, moving through the ecological life
cycles, getting into our bodies, and raising certain very serious
Now, why is it that we have an end to testing in the atmosphere? The
reason is that there was a Test Ban Treaty between the United States
and the Soviet Union. Let me remind you how that came about.
It came about shortly after Mr. Kennedy came into office, and he sent
his science advisor, Mr. Weisner, to Moscow, and a draft treaty was
produced. Now I remember when he came back there was great
consternation because everyone suddenly realized the Senate had to
ratify the treaty, and the Senate at that time was rather reactionary
and it was believed to be impossible to get the Senate to ratify the
Because you realize that that represented the largest change, the most
dramatic change, in U.S. foreign policy, up to that time. You remember
that Mr. Stevenson lost an election over the question of nuclear
testing. It was clear that the government was committed to nuclear
testing. Suddenly Mr. Kennedy came into office and said, “We’ll do it
the other way,” and the question was, would the Senate turn around?
Well, they did. Most of the Senators, about three-quarters of the
Senators, voted for the treaty, and it was signed.
And a little while later it was looked into, why did this change take place?
What was discovered was the Senators got a lot of mail from their
constituents. But what impressed them was not that their constituents
were against nuclear testing. What really got to them was that the
people who wrote the letters knew how to spell strontium 90. They had
the facts. It was a complicated thing, and the people who wrote to
them exemplified a condition that they would face when they returned
home, namely that they would face constituents who knew the facts
about nuclear testing and could compel the legislator to respond to
those facts. I remember Senator Clinton Anderson, who voted one way a
little earlier, switched around simply because he said he read his
mail, and the people knew what they were talking about.
So that’s an example of an environmental victory, and it came about by
the people understanding the problem. Now, how did they understand the
problem? Well, I should tell you that I never heard of strontium 90
until 1953, and I’m fairly well-trained. I went to Harvard, and so on.
Most people didn‘t know about strontium 90. Well, they learned it, and
they learned it from scientists.
Many of us studied fallout, studied the physical, chemical, and
biological processes, just as though we were getting ready to teach a
course in it, and some of us did later on. And then we went out and
appeared in churches like this, and other kinds of churches, and I
assure you my knowledge of religion in St. Louis suddenly broadened
enormously. I think I’ve been in almost every church in St. Louis as a
result of going around talking with people.
And they began to learn. And when they learned, and the political
issue came up, they told their legislators what they knew and what
they wanted and they got it. So, there is a case of where knowledge
about a fairly technical thing, given to the people so that they could
understand it, resulted in a political change, a rather important one,
and an environmental victory.
An environmental defeat: Alaska pipeline
Now, let me give you an example of an environmental defeat. The Alaska
pipeline. I think most ecologists will say that was a terrible thing.
The Alaska pipeline, which was built from the north shore of Alaska,
down to the shipping point. And you remember there was a big battle
over it, between the ecologists and the oil companies, and the
And I want to ask, “Why do you think they lost?” Well, the battle was
fought over what issue? I was reminded about it when you sang your
song. The battle was fought not over a human issue at all, it was
fought about caribou, and lichens, remember? They said the caribou
would trip over the pipeline, and the lichens would be destroyed when
the tractors ran over the frozen tundra.
Now, I don’t remember any arguments that were relevant to human
beings. And the ecologists lost. But in a way they deserved to lose,
because they were fighting the wrong battle.
Now let me explain to you, and of course this is hindsight, how that
battle could have been won, hands down, not perhaps that year, but
certainly one or two years later. And that would be if the
environmentalists had gone in what I like to think of as hot pursuit
of the truth. Now what do I mean by that? Well, there was a problem.
The pipeline was going to be laid down, it intruded on the environment
and on the people of Alaska, and you have to ask yourself the
question, well, what’s the origin of this piece of foolishness, why is
it being done? What effects would it have? And the environmentalists
got to the point of understanding that it had something to do with the
environment, and then said, well, here we stand our ground, the
environment is going to be spoiled, and we‘ll fight it at that ground.
Now, if I were an oil company executive at that point, I would be
chuckling, quietly, secretly, because that’s exactly the battle ground
that the oil companies wanted to fight on. What battle ground would
they have lost on? Well, if the environmentalists had gone in hot
pursuit of the truth, from ecology to economics, and said, “We would
like to know what the economic significance and effects of this
pipeline would be. We want to see your books. We want the tapes. We
want to know what’s in it for the oil companies.”
You know what would have happened? A couple of years before the great
expose of the high profits that oil companies were making, the
ecologists would have revealed that to the public, because it’s now
clear that the Alaska pipeline is a huge economic bonanza for the oil
In other words, if the scientists had extended the pursuit of truth to
the true origin of the problem, namely that oil companies were doing
it to make profit, a huge profit, and had that become known to the
people, I think we would have had the kind of political reaction that
we saw in 1973, which was just a couple of years after the Alaska
pipeline controversy, you remember, when even Mr. Jackson found it
necessary to line up the presidents of the seven oil companies and
shake his finger at them because they were making so much money. And
when The New York Times began to publish on the front page, every
other week, a graph showing the rising profits of the oil companies,
and of course the oil companies responded by reporting the rising
profits of The New York Times.
Get the facts to the people
Well, what I’m saying is, I use these as two case histories, when one
gets at the origin of this problem and exposes it to the people, you
seem to be able to get a political victory, so to speak, political
action. If you fail to pursue the problem to its true source, then
you’re in trouble. And you’re also in trouble if you don’t get the
facts to the people.
With that as a background, I want to do an experiment here today, it‘s
not a physical one, but an intellectual one.
I think you‘re all aware that there are very serious problems now
regarding the willingness of the country to support environmental
improvement. In New York State, Governor Carey has now issued an edict
that anyone in his administration who favors the environment over the
improvement of business had better get out. The Governor of New Jersey
has said the same thing. Mr. Ford has acted vigorously in that
I think most people think the environmental movement is in retreat.
It’s in retreat because it can’t stand the force of economic priority,
that jobs are more important than the environment, after all. And I
should say that if there were a choice between jobs and improving
employment, I personally would favor improving employment. However,
that’s not the choice.
And what I want to do as an experiment is this: I want to discuss with
you the interactions among three rather complicated areas of life—the
question of the environment, and the use of energy, the whole business
of the ecosystem and our resources, and how this relates to the
production of goods, our welfare, jobs, and how this relates to the
economic difficulties that we now face.
I think you’ll admit these are three very complex areas, and the
experiment I want to carry out is this. I‘m going to carry on an
experiment along the lines of what I’ve been talking about, about what
I call sensible, political action, that represents the welfare of the
people of this country on these issues, the terrible knot of issues
that now troubles everybody. We will get action on that insofar as the
people of the United States understand the complicated facts, and then
make that known to their representatives. That’s my hypothesis.
The test is, and I think you’ll all admit, most of you, that this is
not an area in which you are so well-informed that you’re ready to
write, let’s say, to the Governor of New York state, and tell him how
it’s possible to have both good environment and jobs. Or to explain to
someone how you can save energy and still save the economic system. In
other words, this is a difficult problem which I think most people are
not ready to deal with, and as a result they’re rather pessimistic
about being able to cope with the political power.
I was at a discussion of nuclear power over at MIT the other night and
a number of the experts kept saying, well, here‘s what’s going to
happen. We’ll have to have nuclear power, as though there were some
external force driving us in this direction rather than ourselves
making up our own minds. Many people feel weak, subject to this kind
of, you know, you can’t fight City Hall, we’ve got to do something
about jobs, and so let’s forget about these other things.
So the experiment I want to perform, and it‘ll be a brief one, but I
think it can be done, is to share with you some of the key facts about
these problems and go in hot pursuit of that truth and see where it
gets us with respect to the question of what we need to do
politically. Let me take a couple of exemplary problems.
As you know, we have a shortage of domestic oil in this country, we
import about 35 or 40 percent of our oil, and as a result in 1973
there was an embargo. You people, particularly here in New England,
had a great deal of trouble, because there was a shortage of fuel oil
and gasoline. You were told at the time that the problem is we are
running out of oil in the United States, because after all there’s a
limited amount of oil under the ground, we’ve been using it very
rapidly, and if you look at the data you’ll find that the amount of
oil in the United States is falling off.
And indeed, since 1955 or so the rate of finding oil in the United
States has dropped to about half of what it was. If you can’t find oil
it means we’re using up the oil that is easily found and that we’re
just running out, and that’s why we’re importing oil and unfortunately
it led to the embargo.
I think that’s a fair summary of what most people believed—that’s what
they were told. This turns out to be totally false, and let me explain
it to you on scientific grounds.
It’s true that the rate of finding oil in the United States has
dropped. But let me explain why it has dropped, because you have to go
in hot pursuit of the truth. Well, how do you find oil? There are two
things that are involved. One is, how much oil is under the ground.
The less there is, as you use it up, the harder it is to find.
But finding oil also depends on looking for it. And it turns out that
there were measures of looking. So, for example, there are statistics
on the number and depth of exploratory wells which are drilled in the
United States each year. The more you look, obviously, the more you’ll
find. So an interesting question arises. What has happened to the
intensity of looking since 1955? And what you’ll find is that it has
dropped by 50 percent.
Well, this tells us right away, a very simple fact. That the reason
why we are not finding oil is that the oil companies are not looking
for it. That seems rather simple. Well, let’s not stop there. Let’s go
in hot pursuit of the truth. Why are they not looking for it? Well,
what you do then is do what I did in getting ready to write a book
about this recently, I went to the library, and I looked up, I simply
went to the section on geophysical exploration of oil, and what I did
literally was pull them all off the shelf and sit down with them. I’m
no expert in this area and I didn’t know where to start, I just
I found an article written by a man named Blauvelt who is now
President of the Continental Oil Company, he was at that time I guess
executive vice—president, and you’ll see why he was promoted in a
moment. Mr. Blauvelt gave a paper before a geophysical conference in
Texas. His paper was entitled, and I’m quoting, “How to Become a
Foreign Oil Company.”
The paper was given in 1966, and he was very proud to report that the
Continental Oil Company, which for many years operated solely within
the confines of the United States, in the 1950s made up their mind to
go foreign, to produce oil outside the United States, and they were
very successful in doing that, and he was proud to report how it was
done and why it was done.
I want to read to you two statements from his paper which explains why
the Continental Oil Company became foreign. He said, and I’m quoting
First, there was the need to maintain and increase our sources of
low-cost oil. Only the low-cost operator can survive and earn a
reasonable profit. The cost of finding and developing a barrel of
crude oil in the United States was revealing a stubborn upward trend.
The discovery of prolific reserves in the Middle East beginning prior
to World War II had made it evident where the large fields of low-cost
oil can be found.
And then he continued,
A major consideration important in our decision was the apparent
profitability of foreign oil operations. As overseas crude output
rose, profits also grew rapidly, and the rates of return earned by
U.S. companies from their international operations proved considerably
higher than the returns from their U.S. operations alone.
And he had a graph in the paper which showed the rise and fall of
profits from domestic operations and foreign operations for U.S. oil
companies, and what he showed was that whereas between roughly the 50s
and the middle 60s the profitability of oil produced in the United
States dropped from 15 percent return on equity to 14 percent, and it
rose from 15 percent to 28 percent for foreign operations.
And at the time he was speaking, the profitability of foreign oil
operations was just about twice the profitability of domestic oil
operations, and what he said was that Continental Oil, this rational,
intelligent company, went where the profits were greater. And as a
result it closed down much of its oil exploration activity in the
United States. Why look for oil that isn’t profitable? And went
So as part of the experiment, do you agree with me that the
explanation for the shortage of domestic oil that has troubled us is
what? It’s the fact that oil companies do not operate for the purpose
of producing oil. They operate for the purpose of producing oil at a
maximum profit. At a profit greater than the one that they have now.
In fact, they’re not even interested in producing oil.
I now quote something else for you, again from an oil company
executive. This is John J. Dorgan, senior vice-president of the
Occidental Oil Corporation. He said, this is quoted from an interview
It doesn’t mean a thing to say to a private company that there’s a
great need for oil. You have to have incentive. If it turns out that
phosphate rock is more profitable, we’ll put our money there.
In other words, an oil company is in the business of producing profit, not oil.
That explains it. Because clearly in this country all corporations
operate according to that precept, that‘s well known, it’s known as
the bottom line. You do that which maximizes your profit: in this case
it was to go abroad. The consequences were the huge results of the
embargo, a very rapid escalation in the price of fuel, the price of
fuel had been very constant for about 20 to 25 years and suddenly in
1973 it began to shoot up, and incidentally was the driving force in
It is the most rapidly rising sector of our prices, and it’s carrying
up the price of fertilizer for the farmer, carrying up the price of
food for everyone else, and what we have here is a social disorder
created by the normal, natural operation of the private enterprise
You notice I have just made a statement about social disorder, private
enterprise, and economics, and I started from a geophysical question.
Right? Well, I went in hot pursuit from the geophysical behavior in
the ecosystem all the way to what I think is the locus of the problem,
namely, the design of the economic system.
And I can tell, since I‘m a very experienced teacher of freshmen, that
most of you understood what I said — so, so far the experiment is a
success, and I dare say that you could, if you wanted to now, write to
your Congressman and say there is something wrong in the way in which
the oil companies are behaving, having to do with the fact that they
produce for profit rather than for the social needs of the country. I
don’t advise you to do it, but I think you could.
Well, let me continue with the experiment. This is an example of one
of the features of the energy problem, namely, how much is there? And
it exemplifies the kind of thing that we face as we use more and more
energy. Now the other side of energy is using it, and I want to take
an example now of the use of energy, and see if we can understand how
it relates to the question of jobs and the economic system, and so on.
Well, I have to inform you that there is a rather detailed and
complicated science of energy called thermodynamics. I also have to
inform you that although I was very carefully trained in
thermodynamics at Harvard, I really don’t understand it, and I speak
for many scientists—it’s a very tricky field, very tricky. There are a
few physicists and physical chemists who understand thermodynamics.
Most of us know how to use it, but the minute we start to use it,
everything else gets sort of vague and fuzzy, so we don’t really know
exactly what it’s about.
If you give me, say, four minutes, I’ll explain it to you.
I can explain it because, as I wrote in my new book, I confronted this
very difficult problem; I want to talk about energy, and if we’re
going to talk about energy we have to know the facts, and even though
I didn’t understand thermodynamics, I knew somebody had to. So I
learned it. Well, obviously we’re not going to do it all in four
minutes, but let me give you a couple salient features of
thermodynamics that we need to understand in order to come to grips
with the energy problem.
There are two main laws of thermodynamics. One of them is that energy
cannot be destroyed or created. And cleverly enough, that’s known as
the First Law of Thermodynamics, Energy is Constant, in and out.
That’s a very interesting law, because it suddenly makes everything
look kind of crazy. If energy can’t be created or destroyed, what’s
the fuss about? How come we’re running out of energy? Try that out on
some oil company executive. It’s a very interesting thing.
It turns out that whereas the First Law is an important statement, it
reveals that you need to know more about energy than how much you
have. You have to ask yourself, “What is energy good for? What do you
do with energy?” It turns out that what you do with energy is get work
out of it. Work has a physical meaning, but you all know what work is.
Moving around is work, doing things is work. Making something happen
that otherwise wouldn’t happen is work.
That’s a pretty accurate thermodynamic definition of work,
incidentally. If you want me to put it in fancy terms, I will say that
any spontaneous action can only be reversed by using work. That’s the
fancy way of saying it. But what you know is if you want something to
happen that won‘t happen by itself.
For example, if I let go of this, it goes down by itself. No problem.
Right? I don‘t have to do any work for that. But if I want to pick it
up, obviously it won’t happen spontaneously; I can’t hold my hand here
and say up. It won’t happen. It will lie there forever. I can wish all
I want, it’ll stay there, it’s an absolutely sort of eternal thing.
And yet I can—I shouldn’t say this here in church—I can reverse
eternity just by bending down and picking it up. That means work. I
have to use energy to do it. The energy I use is what I had for
breakfast, and so forth. Alright? So energy is a way of achieving
work, and in fact, it‘s the only value that energy has. The only
meaning of energy is that you can get work out of it.
Now, then you have to ask yourself, “How do we get work out of energy,
and how much do we get out?” Okay? There are various ways of using
energy, and I’m going to skip over a lot of thermodynamics. Most of
thermodynamics tells you the efficiency with which you can get work
out of energy. Sometimes you can‘t get any work out of it, sometimes
you can get a certain amount.
Wasting energy with bad design
It turns out that one of the laws of thermodynamics is that you can
never get all of the energy converted to work. A Frenchman named
Carnot discovered that in 1824. That whenever you try to run a steam
engine, for example, a steam engine works, goes around, you can only
get at most about 40 percent of the energy that’s in the fuel in the
form of work. The rest of it goes off as heat. The engine gets hot.
And so every power plant we have, the most efficient power plant we
have, converts the energy that is in fuel to the mechanical motion of
the generator which produces electricity, and electricity is really
sort of mechanical motion, it happens to be electrons. That generator
can only turn about 35 percent of the fuel’s energy into electricity.
The rest goes off as heat, and that’s what’s called heat pollution.
That’s the warming up of the river, the cooling water goes through and
it warms up the river.
So, what we’ve learned so far is that if you want to get mechanical
motion, work, out of a source of fuel, inevitably you divide it into
two pieces. One is, let’s say, electricity, which is easily translated
into work, you just run a motor, and the other is low-temperature
heat. The waste heat. Two outputs. Okay?
That’s enough thermodynamics, that’s about five minutes, now let’s ask
a very interesting question. We want to conserve energy—or conserve
fuel, let’s put it that way. We now know that we have a private
enterprise system, so that we can’t seem to be able to produce all the
fuel that’s available in the United States, and therefore for the
moment we have to conserve it until we do something about the economic
system. So, meanwhile we’re going to have conservation.
And I want to ask the question, “How should we conserve?” Well, now
suppose we have a task, keeping this room at 70 degrees while it’s
cold outside. I don’t suppose this building is heated electrically,
but some of your homes are. And therefore, what you are doing is
plugging your heater into the electric outlet at the power plant,
right? You’ll notice that there is another outlet of energy at the
power plant, the heat waste. And the waste heat is just right for
warming up the room. It’s low temperature heat.
And in fact in New York, in a few parts of New York, the electric
generators distribute steam, low-temperature heat, to buildings. You
see steam coming out of the ground in various places, that’s the steam
lines which are using the waste heat from the power plant to do just
what you should with waste heat, which is to warm up places. Most of
Moscow is heated that way.
So we have a very interesting situation. A power plant has two energy
outlets. One outlet is good for doing things like driving your washing
machine, because that’s mechanical, takes work, and you need the
electricity to do it. But if you want to warm up the water for the
washing machine it would be much more efficient to use the waste heat
from the power plant rather than electricity. As you know, that’s not
the way it works. For example, dishwashers have an electric heater in
them to heat up the hot water.
So we have a bad arrangement between the power plant and our homes.
We’re not plugged in the right way. The vacuum cleaner should be
plugged into the electric outlet, but the hot water heater should be
plugged into the waste heat outlet. But that’s not the way things are
Incidentally, let me tell you now what the thermodynamic efficiency of
producing hot water is. What that means is—what’s the value of energy?
Work. So, if we want to ask what’s the thermodynamic efficiency, how
much work are you using relative to the amount that you need to use,
the minimum amount you need to use, to accomplish a work-requiring
task. Let’s take the task of producing hot water in your home. That
takes work, you‘ve got to get it done. Well, this computation’s been
done, very recently, and it turns out that the thermodynamic
efficiency is about two percent. Just about two percent. We are using
fifty times more work to heat our hot water in the United States than
we need to. And the reason is that we haven’t got good arrangements
between the sources of power and the uses of power.
Wasting energy with inefficient transport
Well, I can give you many more examples. The thermodynamic efficiency
of our transport system is 10 percent. And the reason is that we put
little engines in vehicles and since Mr. Carnot tells us that only a
small part of the energy in an engine can be converted to motion, the
rest goes off as heat. And when you drive down the street, you are
putting most of the energy in the gasoline into heating the air.
Meanwhile, you’re driving past somebody’s home who would love to have
that heat to warm up their home. That seems simple. And it can be
The way you do it is by having this split between mechanical motion
and heat. A [power plant] is not something that flits about, but sits
still. And then you can recapture the heat, and what you do is take
the electricity and use it to run a train. So, mass transit, using
electric trains, would allow us to make proper thermodynamic use of
the energy and would be much more efficient.
Well, let’s pursue this a little further. A beautifully thermodynamic
efficient way of moving about the city is an electrified trolley. Do
you have any trolleys in Boston? No. We don’t have any in St. Louis,
and we have to ask why.
Did they get sick and die? No, they were killed. They were killed by a
corporation made up of General Motors, Firestone Rubber Company, and
the Standard Oil Company of California. A man named Bradford Snell, a
couple of years ago did a beautiful analysis of the destruction of the
trolley systems of the United States—the best thermodynamically
efficient way to have urban transport.
It was done by this company, it was called I think the American
Transit Company. What they did was go into a city, they did in St.
Louis, buy up the trolley company, tear down the wires, junk the
trolleys, and buy buses, and Firestone tires, and Standard Oil
gasoline. Then this company, apparently not really interested in
running transportation, sold the company to somebody who wanted to run
buses and took their money and went to another city, bought up another
trolley line and destroyed the trolleys and the electric wires.
They were brought into court in the Chicago Federal District and fined
$5,000. The vice-president of the company, who had single-handedly,
apparently, participated in the destruction of a hundred million
dollar trolley system in Los Angeles, was fined $1.
Now I think it’s clear we’ve gone from thermodynamics to power plants
to Carnot to what? To the understanding that the reason why we haven’t
got a thermodynamically efficient urban transport system is that the
profit arrangements are such that it is entirely expected of a company
that wants to sell buses to destroy its competition so that it can
make a better profit.
Well, I could go on, but I’ll put in a plug. You can buy my new book,
which is called The Poverty of Power. It’ll be out in May, but in it
I’ve gone through a series of discussions of this sort, all of which
lead to the conclusion that the problems that we have derived from the
operation of the private enterprise economic system. And, what the
problems show, what the analysis shows is that the reason why we are
wasting energy is that we are supplanting human labor with machines.
Wasting energy with synthetics
Let me give you a quick example—am I running terribly over my time?
Alright… Let me give you one example of the way in which we’re meeting
our needs that I think exemplifies it. We‘ve talked about the human
need of having a room at 70° and moving from here to there, and we
found that we were using energy wastefully. Let’s talk about another
human need, and I’m going to focus on that purse down there, that
Now there are two ways of making a handbag, generally, you can make it
out of leather, or you can make it out of plastic. And as you know,
plastic has displaced leather. Many more handbags are made out of
plastic now than used to be. And I will assert that the end use of a
handbag made of leather and plastic is about the same. Now I know
there are all sorts of aesthetic differences, but as a first
approximation we’ll say that a handbag is a handbag, whether made of
leather or plastic. That’s the social use value of a handbag.
Now I’m going to ask a question: What does it cost society to produce
the two alternative handbags? The numbers are available. What are the
costs? Well, to make the handbag you need to use energy and other
resources. You also need to use machinery, which has to be bought by
capital. Well, so there’s the efficiency of the use of capital, and
then there’s the efficiency of the use of labor. Let me quickly give
you a rough picture of the figures. If you ask how many handbags you
can produce out of a unit of energy, you’ll find out you can produce
about five or ten times as many handbags out of leather per unit of
energy as you can plastic. It takes much more plastic, much more
energy to make plastic than leather.
The reason is that plastics are made of petroleum, and various kinds
of chemical reactions have to be carried out. So, plastics consume a
lot more energy per unit output than leather. So every time you buy a
plastic bag or synthetic shirt it takes about ten times as much energy
to make the fiber for a synthetic shirt, nylon or what have you, as it
does to make cotton. You’re using more energy. It turns out that you
also use about three or four times as much capital, because the
petrochemical plants are very big, with an awful lot of machinery and
capital in it. So, producing a plastic bag is wasteful of energy,
wasteful of capital, but it uses much less labor.
The petrochemical industry, which is petroleum, chemicals, and if you
add transportation in, represents companies which produce about 20
percent of our gross national product. They employ a little over two
percent of the work force. So that’s been going on, and this is
typical of what’s been happening in the country, is that energy is
being used to drive the machines that displace labor. The result is
that we’re heading towards a shortage of energy, a shortage of
capital, and an excess of labor, or a shortage of jobs. So that if we
were to really save energy, we could create jobs, for example, by
cutting back on the petrochemical industry.
The solution is socialism
And again, we’re right back where we were before. The decisions that
are made in this country about how we produce goods are based on what
maximizes profit, not human need. And as far as I can tell the answer
to Governor Carey and the answer to the pessimistic view that we can’t
have a good environment and jobs is that there’s something wrong with
the way in which we’re using our resources.
We’re using the profit motive to make elaborate decisions about
thermodynamics, about chemicals, about natural materials, when clearly
we ought to be asking what’s good for people.
And it would have been a blooming miracle if the thousands of
decisions made in this country that have transformed shirts from
cotton into plastic, from soap into detergents, from leather to
plastics, all of these changes, all of which were made according to
one criterion, increasing profitability — it would have been a
fantastic miracle if out of that came a beautiful, sensible way to use
our resources efficiently without fouling the environment and giving
people lots of jobs. It didn‘t work.
Well, I think the answer is then that we have to reorganize the way in
which we run our economic system.
You see, I’ve described for you what was described most precisely and
initially by a scholar of the capitalist system named Karl Marx.
I’ve described exactly what Marx talked about, the displacement of
labor by capital and the resulting inefficiency of the operation, so
that people are now forced to lose jobs in order to avoid polluting
There’s something wrong, and I think the answer is that we have to now
begin to think about replacing the capitalist organization of the
economic system by a system which is governed by human need, by social
need, and of course, with a small s, that’s socialism.