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The End of the Automotive-Petroleum Age
Kirt Sechooler March, 1997


Geneva, July 9, 1996, Xinhua News Agency: "Insurance Companies warned here on Tuesday of enormous economic costs if global actions to reduce greenhouse gas emissions come too slowly."

Geneva, July 18, 1996, Reuters: "Key world powers, led by the United States and the European Union pledged Thursday to fight global warming by working for an early accord reducing gas emissions produced by oil and coal use."

In an essay entitled the End of Industrialism and the Organizational Structure, we stated that at the very beginning of the American Industrial Revolution, some two hundred years ago, the United States was a nation of approximately four million people, free and slave, the overwhelming majority of whom lived in rural circumstances. Additionally, we observed that the population of the United States today stands at over two hundred and sixty million individuals, the vast majority living in and around great urban centers.

We further noted that what made this massive transformation possible was the development, in the four technological cycles we have already described, of Capital as an economic factor of production and the corresponding creation of a vast store of Capital Wealth. The creation of this great store of wealth and the economic and social transformation it made possible represent one of the greatest accomplishments in human history.

The drive for increased Capital Wealth during the Industrial Age flowed from an urgent, genuine and overwhelming need, on the part of the people participating in the Industrial Revolution, for a greater material standard of living. The satisfaction of this powerful human need had fundamental and long term ramifications, however. The drive to increase capital during the Industrial Age led directly to the fact that the technologies of the Age would almost invariably sacrifice efficiency in a quest for scale.

This point is not well understood largely because during the Industrial Age efficiency has misleadingly been defined as anything that increases the scale of economic activity. The ultimate result of the relentless pursuit of scale during the Industrial Age, however, has been that the technologies of the Industrial Age became increasingly large scale and increasingly resource intensive. The last period of the Industrial Age, the 1940s through the 1990s, the Automotive-Petroleum Mass Suburbanization Cycle, clearly became particularly, and most destructively, resource intensive.

One of the today’s great realities is that the Industrial Age is ending precisely because its great historic mission has been accomplished. There is in existence today in the world in general and in the United States in particular a vast store of Capital Wealth, wealth on a scale that would have been beyond all imagination two hundred years ago. However, there are also, again today, tremendous problems associated with the overly intensive utilization of resources associated with the Cycle, and the Age, now ending.

In a prior article we discussed how at the beginning of the declining phase of the third technological cycle of the Industrial Age, the Era of Mass Production and Mass Urbanization, the financial structure collapsed and threw the world into the Great Depression of the 1930s. We also discussed how reforms in the wake of that immense tragedy meant that the beginning of the declining phase of the fourth cycle of industrialization, the Automobile-Petroleum Mass Suburbanization, has not seen a great financial collapse. And in fact, the end of the Automobile-Petroleum Mass Suburbanization Era will in all likelihood not be accompanied by the type of general financial difficulties that occurred during the declining phases of the Industrial Age's previous technological cycles. This does not mean, however, that the current technological cycle will not end, only that a force other then financial collapse will end it.

The force that is likely to drive the end of the fourth cycle of industrialization can be seen in articles that discuss the recent spate of unusual weather, or more importantly, in the fact that in Geneva, Switzerland, the world's biggest casualty insurance companies recently met. The topic of the meeting was global warming, and the mounting underwriting losses that the insurance industry is experiencing as it confronts an ever increasing number of flood insurance claims. The casualty insurers want the world's governments to address the climatic instability global warming is producing. Global warming itself is the ultimate manifestation of the overly intensive utilization of resources that is the unintended byproduct of the final cycle of the Industrial Age.



  • Scientists Say Earth’s Warming Could Set Off Wide Disruptions. NY Times. 1/18/95.
  • Satellite data: El Nino Twice as Strong as in 1992-93. AP. 1/31/95.
  • Heat Death Toll Rises to 436 in Chicago. NY Times. 7/20/95.


  • Bad Weather? Just Wait. NY Times. 1/10/96.
  • Insurance Industry Leading Fight Against Global Warming. NPR. 1/19/96.
  • Cold Wave Washes Over Midwest: 23 die in Chicago. LA Times. 2/1/96.
  • Florida Facing Crisis in Insurance: Hurricanes Batter Both Companies and Homeowners Coverage. NY Times. April 25,1996.
  • Grain Prices Soar On Poor Weather and Low Supplies. NY Times. 4/26/96.
  • Worst Drought Since 1930s Grips Plains. NY Times 5/20/96.
  • Insurers Curbing Sales of Policies In Storm Areas. NY Times. 10/10/96.
  • Snow Sweeps South, Icebox Chills Plains: Baby, It’s Cold Out There! CNN. 12/18/96.


  • Pacific Northwest Slogs Through Season of Woes. NY Times. 1/2/97.
  • Fierce Wind and Rain Tear Up Several States, Killing at Least 35. NY Times. 3/3/97.
  • In Storms’ Wake, Grief and Shock: 8 States Confronting Damage From Tornadoes and Floods. NY Times. 3/4/97.

What we will likely be witness to, in the next few years, is a titanic struggle. On the one side will be the leading forces of the fourth technological cycle of the Industrial Age (the world's hydrocarbon producers -- the oil, gasoline and coal companies, together with the world's oil exporting nations, as well as America's own oil producing states), and on the opposite side will be the world's insurance underwriters with other elements of the emerging Post Industrial Age. The outcome of this struggle will define the economic landscape of the next century and the beginning of the new millennium.

The fate of the market system itself may very well be at stake. The casualty insurers mounting underwriting losses reflect an urgent real world problem. The modern market system is in fact functioning perfectly in alerting the world to an ominous new reality by quantifying that reality through the underwriting losses experienced by the world's casualty insurers. What the world’s governments, citizens and business people do with this information will determine the future of the market system and the future of the generations whose lives will extend into the next millennium. If today’s political and organizational structures do not or cannot heed the reality that the casualty insurers are presenting to us, then we may very well be insuring that a new command economy will arise to deal with the problems stemming from the overly intensive utilization of resources associated with the now ending Industrial Age.


NY Times. April 25, 1996. Florida’s Insurance Commissioner, Bill Nelson: "There are limits to what the state can cover if a hurricane hits a large metropolitan area and causes residential losses of $25 billion to $50 billion....If we have another big hurricane, all bets are off." mmm