Author: p_c_neary@hotmail.com

Ever wonder why the prices at gas stations go up so fast, but come down so slow? Not around here, where PEMEX continues to own most stations and even those run (under an aborted attempt to introduce competition) by other oil giants must buy their gas from PEMEX! But it’s a common enough phenomenon in the States as to anger the average person.

Ask your favorite liberal/progressive, and it’s a conspiracy of sorts. President Biden and some of his spokespeople coined #PutinPriceHike to blame the rise on everybody’s least favorite authoritarian. Putin certainly isn’t helping, but gas started rising long before the war in Ukraine. Senator Elizabeth Warren beat a familiar war-drum: “The cause of rapidly rising energy prices for consumers and manufacturers is clear: some of the nation’s largest and most profitable oil and gas companies are putting their massive profits, share prices and dividends for investors, and millions of dollars in CEO pay and bonuses ahead of the needs of American consumers and the nation’s recovery from the pandemic.” Big Oil profits are at or near record levels. From the conservative side, pundits blame Joe Biden for cancelling the Keystone pipeline and pausing new drilling leases on federal land. Yet a pipeline doesn’t increase production, and thousands of leases remain unused. What’s really going on here?

Strap in, this may take a while, and if you’re open-minded and not careful, you might learn something!

All these claims have some truth: the best propaganda always does! But none of them captures the whole story, which is far more complicated (bad) but also interesting (good). I’ll attempt to make it simple:

After in-depth research, I uncovered this unassailable fact: not a single one of the major oil companies (hereafter Big Oil)– neither ExxonMobil, nor bp, not Chevron or Marathon–is registered as a 501.c.3 charity; look it up. Apparently, all of them are for-profit enterprises; I know you’re shocked. And as such, they try to make more (and more, and more) profit, all the time. There is a technical term for businesses which don’t seem dedicated to profiting: bankrupt. Not that this justifies just any old behavior (like price-fixing or profiteering, just to name two), mind you, but also keep in mind that there is an entire part of the federal bureaucracy (in the Justice Department) which spends all its time looking for such things. So don’t be surprised when Big Oil makes money, and know that someone is always looking over their shoulder if they do it the wrong way.

Let’s look at the other end of the spectrum: the price at your local pump. It is there the pain is felt, and no, you’re not imagining it: prices do go up faster than they come down. Is that Big Oil? Big Oil owns around one percent of the gas stations in the US; the rest are independent or have affiliations, which are unique supply contracts (if you’re a bp station, you only offer bp gas and products). About fifteen cents of the cost of each gallon of gas goes into paying for the overhead of owning/running a station: breaking even for the gas station owner means charging 15¢ over the price he/she paid. Most look to charge about two cents more for profit (yes, gas stations on average make just two cents profit per gallon). The federal and state governments also tax gas sales: so different tax rates in different states are another cause of price differences.

Gas stations fill their tanks between once and twice a week, and the price they pay changes constantly. So they are in a slim margin business with high volatility; the only saving grace is most everybody needs their product, and people like to re-use the same stations for convenience. But the gas station owner might be selling gas he bought last week for a price he is anticipating next week (cheaper or dearer). Guess wrong one week, no problem. Guess wrong too many weeks: bye-bye. So they generally raise prices faster and lower them slower. Note, we’re not talking about huge profits here. Why not? Because the gas station across the street gets its gas deliveries on different days, and is facing the same challenge. If the first station raises its prices too soon or too much, the second station gets more business. If it happens all the time, the first goes out-of-business. Ahhh, competition. I’m sure we all have stories of gas-price wars which resulted in some amazing deals-at-the-pump.

And in case you were wondering what the biggest cause of retail gas prices is, the chart above shows the correlation between oil prices and retail gas prices. This is what we call a strong correlation, almost certainly causation. There are only minor times–usually a result of some crisis or shock to the global supply chain, where the two prices don’t vary directly. But what about Big Oil’s massive profits? Don’t they prove price gouging?

I’m am sure you heard that ExxonMobil raked in $23 billion in profit in 2021. The same goes for all Big Oil. But did you know ExxonMobil lost $22.4 billion in 2020? Their net profit for two years was $600 million, which is nothing compared to revenues. All Big Oil took a huge hit in 2020. They went on a down-sizing binge (cutting costs) and started selling off assets that didn’t fit with (some of) their commitments to move away from fossil fuels. The combination of a large drop in expenditures, profits from businesses they sold, and the rise in oil prices resulted in . . . record profits. Not gouging, not conspiracy, just a fortunate turn after a very, very bad year. Apple is the world’s most profitable company, with 2021 profits of almost $153 billion, also a record year; where’s the concern for that number, which came after two previous record years of profit?

Big Oil is a very robust industry, for a reason. They pioneered the concept of scenario planning. With the long-lead times for production, market volatility, and vulnerability to geopolitics, they had to! Royal Dutch Shell–as it was then named–pioneered the process of looking at alternative futures way back in the 1970’s, and used the work to anticipate things like the 70’s oil shocks and survive them as a business. I attended an executive education seminar at Oxford in the early 2000’s, and we were still studying Shell’s techniques then!

Speaking of long lead times, what’s up with all those leases President Biden mentioned? And what happened to the US fracking revolution, which made us energy self-sufficient during the last administration? It can take decades to go from field exploration to buying leases to approving permits to putting in the drill rigs and pipelines to pumping oil. These are costly endeavors which may or may not produce marketable oil. Companies speculate on leases, buying some on the prospect there is oil and others to keep them out of another company’s hands. After you acquire a lease (for example, from the US federal government which owns about about 47% of all land out west), you still have to do research on the site, and test for suitability of the site and the oil. If it passes, you must begin the permitting process, which involves sate regulators and environmental agencies and activists. All this process is proper, but imagine how long the studies and lawsuits take. Then comes erecting the drill site and laying the pipeline, and finally, pumping oil. The outlays prior to any possible revenue are huge, and must be accounted for by the revenues resulting from the drilling which does produce. There is nothing unusual or sinister in the number of non-drilled leases held by Big Oil right now. Those decrying the President’s moratorium on federal leases are also just making noise. And all those saying these things know better.

The fracking revolution did itself in. Hundreds of small US companies used the fracking technique to generate sizable increases in US oil production, making the US the world’s largest producer at one point. The competition between the frackers was cut-throat, and OPEC dearly wanted to starve them out by increasing production of Saudi (and Russian) oil at less cost. Then came the Covid economic collapse, which Big Oil survived, but which doomed many frackers. The remaining fracking companies are being more careful about capital investments and profitability, acting more like Big Oil and less like internet start-ups.

Likewise, new pipelines do not increase production. If there is excess production somewhere in the system, and excess refining capacity somewhere else in the system, a pipeline between the two locations can increase overall production, but only in this relatively unusual case. Most pipelines are simply more efficient means of transport, which is not a bad thing, but hardly a near-term solution to anything. Oh, and pipelines face all the same regulatory hurdles as the drilling sites, so no, they are not fast.

Which brings us to “the Turn.” The Turn is the common term used by green energy advocates AND Big Oil for the move away from fossil fuels. British Petroleum even legally changed its company name to “bp” and started citing themselves as “beyond petroleum” (no, no one believed it). Big Oil and green energy advocates use the same phrase, but mean very different things, and the concept has implications for today’s gas prices. As in, if oil prices are high and Big Oil profits are up, and they want to make more profit, why don’t they starting producing more oil? I have explained how it takes time, but Big Oil is not even doing those smaller, simpler things they could to increase oil production immediately. What gives?

What is the future of the energy business?

If you ask any environmental group, anyone concerned about climate change, anybody in the automotive or energy business, they will agree. The Western model of economic development based on the Petroleum, Oil, and Lubricants (hence POL) used by the Internal Combustion Engine (ICE) has been wildly successful, but must come to an end. It was labelled the POL-ICE connection and it is an ongoing revolution in the developing world. Those most concerned about climate catastrophe say it must end now or soon, like in ten years. The industrial giants (including Big Oil) think thirty-forty years, with some residual use after that. But it will end, and it must be replaced with some other energy source.

Now why would Big Oil ever agree to such a “Turn?” Well, the answer to that lies at your local Mickey-D’s. Yes, McDonald’s. You might have heard this story, but it’s a great one worth re-telling. Ray Kroc’s hamburger business was going poorly, and he was taking out personal loans to keep it afloat. A lawyer he brought in to review the business and give advice told Kroc his problem was simple: “you don’t quite understand the real business you are in. You are not in the business of selling burgers. You are in the business of real estate.” Kroc accepted this re-framing of his business proposition and made McDonald’s (with its standard menus and ingredients, franchises and leases) into the behemoth you behold today.

Big Oil realized more than decade ago that they weren’t in the gas business. They were in the energy delivery business. Oil and gas just happened to be the preferred energy products at a place and time, but what Big Oil was good at was delivering energy where and when it needed to be. The green energy advocates think they know the answer: electric cars and charging panels and charging stations. That is one possibility. Big Oil has run the scenarios, and they have made many small bets: electric cars and charging stations and solar, but also natural gas, hydrogen power, and driver-less cars and rigs, touch-less energy transfer, batteries, wind and hydroelectric and tidal power generation, even carbon-capture technology which (if it worked) could extend the POL-ICE combination. See, Big Oil is not sure which will win, and they are placing many bets, waiting to see what’s next.

Which recalls the last Turn, from horsepower to the POL-ICE connection. Some very sage experts in those times pointed out that a man on a horse could ride into the vast countryside with great assurance that he could provision his mount, as the countryside was where the hay was grown. What would happen when all those “drivers” started driving all those “automobiles” out of the city? They would litter the roadsides, out-of-fuel monuments to folly. Except that didn’t happen. Businesses grew to fuel and service the cars, governments built new and more and better roads, and something new and different happened.

All of which is a long way of saying the one thing Big Oil is NOT going to do right now is start many new leases, wells, or pipelines. They have been warned there is not much long-term future in fossil fuels, and they are think they are well-positioned to survive and thrive as “the Turn” commences, once it is clear which way it is going.

So let’s review, shall we. The POL-ICE era is ending, but no one knows how soon. Some advocates believe they know best how it will transition; most businesses and governments are hedging their bets, as there is a fortune to be made or lost. Big Oil may be the least likable business consortium since Big Tobacco. The oil and gas business is (and has always been) cut-throat but very profitable if you can stay ahead of the market. The major inputs to the retail price of gasoline are the price of a barrel of crude oil, taxes, station operating expenses and profit, in that order (from greatest to least). The only way to affect immediate supply and demand in the gas and oil business is to either shut down production or delivery (see the Arab Oil embargo in 1973) or to drastically decrease consumption (see the recent Covid economic collapse). There is no way to quickly increase the supply, unless there is untapped potential being intentionally withheld from the market. The only case where that currently applies is Saudi Arabia, who can literally turn on the spigots, but they are not in any way disposed to do so, nor have they (apparently) been given an impetus or inducement to do so. Saudi did just agree to increase production in the five year time-frame. Higher prices at the pump lag behind reductions in oil prices because that is how the industry (from Saudi Aramco to Bill at the corner station) keeps profitable.

You will see Congressional hearings soon, and both Republicans and Democrats will trot out the same hackneyed talking points we disabused here. Don’t fall for it; don’t re-tweet them or like their social media posts. Gas prices are high for very obvious reasons. You don’t have to like it (I don’t), but be smart about the subject, not partisan. And for God’s sake don’t drive the speed limit in the passing lane.

You could be excused if you believed you had fallen asleep and awoke to find yourself in Europe in the 1930’s. Armies massing? Bogus staged provocations? Claims of the illegitimacy of neighboring states or governments? Interstate war? Same as it ever was.

There is little surprising in Vladimir Putin’s invasion of Ukraine. Even recently, the Biden administration released unprecedented amounts of US intelligence clearly indicating Russia was preparing to do so, and US government officials made one dire prediction after another. These may have become background noise to some, but if so, those ignoring the warnings missed the true significance. Government officials rarely predict something as serious as war: they almost always emphasize first the ongoing negotiations and offer a tepid “war remains possible” walk off statement. In the past two weeks, US officials flipped the script: talking about how Russia was preparing, warning war was imminent, then giving a feeble “we still hope for negotiations.” It was a tell that an invasion was inevitable.

For some of us, this has been obvious for much longer. Long-time Russia hands remember seventeen years ago when Putin described the collapse of the Soviet Union as the greatest geopolitical catastrophe of the Twentieth Century. Neither the holocaust nor Nazism. Neither the holodomor nor the Khmer Rouge killing fields. Not Mao’s Cultural Revolution. The end of the largest authoritarian menace in history was what bothered Putin. Putin publicly dedicated himself then to re-establishing Russia as a great power, feared and respected by the world. Everything he did subsequently was toward that end.

Putin’s Russia will never be a world power, and he knows that. His economy is a mix of what we used to call Third World extraction (oil and minerals) and oligarchic capitalism, benefiting a few corrupt officials. Russian demography remains a disaster: rampant alcoholism and early male death, misogyny and violence leading to few marriages and even fewer births, a shrinking population unparalleled in peacetime. The average Russian is little better off than he was under Communism: and that is totally irrelevant. Putin has a iron grip on Russia itself: he openly jails political foes and kills dissidents with impunity. Russians either admire his strength or fear his vengeance. Remember, this is a country where you can stop in Red Square and take a tourist photo with a Stalin look-alike!

Long term, Russia remains in mortal danger, but Putin has played a mid-term game. Russia was initially too weak to do much but posture. He stabilized the Russian economy during oil price spikes and drops and solidified his position with the oligarchs: they know he will turn on them on a dime if they conspire against him, but they are free to make money if they don’t. He fundamentally remade the Russian military from a massive conscript force to a much smaller, more modern, volunteer force capable of threatening any neighbor, if not NATO writ large. He weathered the so-called color revolutions, losing a client state in Ukraine but holding on to Belarus. He threatened and invaded Georgia, putting its move toward NATO on ice. He has been welcomed into Kazakhstan, and has a “bond without limits” with China (no, I don’t believe this means much either, but it doesn’t hurt).

After President Obama failed to enforce his own red line in Syria (Assad’s chemical weapon attack), Putin moved quickly to ensure his Syrian ally’s security. Then he turned to Ukraine and unleashed his “little green men,” Russian Spetsnaz (special forces) which occupied ethnically Russian potions of the Donbas river basin and all of Crimea.

Russia never accepted the Maidan revolution which had chased off a Russian-friendly government in Kyiv. The Crimea occupation was part practice and part toe-in-the-water experiment. Would the West respond forcefully to naked aggression covered with the only the most transparent fig-leaf? Sanctions indicated the answer was no, and the subsequent Minsk accords gave Russia some cover for its defacto seizures.

Meanwhile, Putin began preparing to finish the job. Russia amassed over $630 billion in hard currency (mostly non-US dollar) reserves in case of future sanctions. His oligarch friends probably did the same with their personal fortunes. The EU estimates current sanctions (pre-invasion) cost the Russian economy $50 billion annually. Assuming the new sanctions are twice as bad, Russia will run out of reserves in . . . only six and a half years! Putin negotiated agreements with friendly states, especially China, to continue trade without using dollars in the event of tightened US sanctions. He began a drumbeat in state-controlled Russian media to show Ukraine was a base of “NATO aggression” or “fascist forces” threatening ethnic Russians in Ukraine.

What happens now? Putin may stop at the Dnieper river to assess the situation. He may not try to take Kyiv in order to avoid the urban destruction and outrage that would entail. He may be willing to occupy ethnic Russian majority areas, establish a land bridge to Crimea and Moldova, and eliminate Ukraine’s access to the Black Sea. From these positions, Putin could pause to negotiate a cease fire and the establishment of a rump Ukrainian state with a government more amenable to Russia. He does not need to, nor does he probably want to, engage in a long-term occupation, which might become the focus of an insurgency.

The Biden administration was dealt a bad hand here: given Putin’s obvious intentions, the West needed to start to act long ago to deter him. However, every administration inherits bad situations, and they are responsible for resolving them. George W. Bush wanted to be “the education President,” focusing on America’s relations with Mexico and embracing “compassionate conservatism”: he got 9/11 instead. President Biden said he knew the world’s leaders on a first name basis; now has come his moment. The President has rightly rallied NATO, even encouraging Finland and Sweden to join in. But this won’t be over soon.

The administration said the array of increasing sanctions were designed to deter a Russian invasion: they have failed to do so. The EU and nations across the globe are joining in sanctions. But will they last? The NordStream 2 pipeline is completed; all Germany did was stop certification. In effect, some bureaucrat in Berlin took the pile of papers off his desk and put them in a drawer. They could resume certification in a moment. Europe needs Russian natural gas (Russia provides over 40% of Europe’s needs), and they cannot fully replace it with exports from the US. Oil prices have spiked to around $100 a barrel, which will further fuel inflation. Putin is betting he, his oligarchs, and the long-suffering Russian people can hold out longer than the–in his view–corrupt and irresolute West. He has a point. Most people forget that the very strict sanctions regime the entire world placed on Saddam Hussein was crumbling just before the Bush administration decided to go to war. We couldn’t keep sanctions on an insignificant country with a certifiable murderer-in-charge; can we do better with Russia?

Was Russian occupation of Ukraine inevitable? Putin took the measure of current Western leaders, and decided he could act. President Biden’s gaffe about a “small invasion” probably didn’t help, but what he said was true (NATO and the US weren’t going to fight to defend Ukraine), even though saying the quiet part out loud was the final nail in Ukraine’s coffin. Putin cannot afford war with NATO. While he would have tactical advantages in location initially, he cannot forestall a NATO build up and eventual counterattack. Any hint of ambiguity about US forces in Ukraine might have given Putin pause. For example, if Biden had rushed the US airborne forces not to Poland, but to Lviv (in far western Ukraine near the Polish border), to set up a permanent defensive perimeter for US diplomats, refugees, and perhaps the Ukrainian government, Putin might have occupied only the eastern parts of the country and steered clear. Even more so if Biden had convinced NATO allies to loin in the action.

Some will counter that American public opinion does not support going to war over Ukraine, and that is true. Neither do I. Yet American public opinion rarely supports going to war. Prior to provocation, the American public wanted to stay out of both World Wars. One major challenge of the presidency is to make the case for why the United States should go to war, if the President sees the need. President Biden ruled out making that case early on, following public opinion rather than leading it. One forgotten lesson of the Cold War is you can only deter an opponent if you have the capability and will to go to war with him; if the opponent doubts either your capability or will, he will not be deterred. The West can’t start the deterrence process by saying “we won’t fight under any circumstances.”

President Biden has announced tougher sanctions. A telling sign was the reaction of the US stock markets: while other markets around the world cratered on news of war in Europe, the US indexes rose! Why? They were expecting much tougher sanctions than the President imposed. We should assume Russia was warned: it makes no sense to rely on some sanctions with a threat of greater ones, if you don’t make it pretty clear how much worse it can get. In the meantime, there is much more the West can do, if the United States leads. All western airlines should be forbidden to land in Russia, and Aeroflot should be denied landing rights anywhere in the West. A review of all Russians on visas in the West for immediate expulsion, and a halt to all Russian visas in process. Russian consulates closed, Russian embassies reduced to minimum personnel. Of course no Russian athlete or team should be allowed into international competitions.

The US military could commence immediate production of ground-launched cruise missiles (GLCMs), once banned under the INF treaty (from which President Trump withdrew the US), and a replacement system for the Pershing II Intermediate Range Ballistic Missile. These two nuclear capable systems were the bane of Soviet leaders due to their short timelines (six minutes) to hit Moscow from Germany. The US should make clear to the Russian government that these weapons will be forward deployed in NATO countries IF Putin does not withdraw from Ukraine and re-establish the legitimate government in Kyiv.

The sanctions will hurt eventually, but will not soon force Putin’s hand. Instead, the West is in for a short (losing) contest for the future of Ukraine, but more importantly, a long contest to re-establish the notion of deterrence which has been lost. That means more spending on defense, more troops and agreements and exercises, more time and attention to foreign policy, and less time, attention, and money for everything else. All that just to maintain the status quo ante invasion.

Or Europe decides warm houses are more important than Ukraine. We lose focus. Americans resent double-digit inflation or a recession brought on by a massive rate increase by the Fed. China runs a sanctions evasion operation. And yes, China is watching how this all plays out for clues about its future interests in Taiwan.

For all intents and purposes, Putin has accomplished his initial objectives. Ukraine is his, and even NATO members like Latvia, Lithuania, and Estonia must be wondering about their security. Now the larger game is afoot. Does the US lead a reinvigorated NATO, and to what end? Do we find a way to pressure Putin and Russia to let go of Ukraine? Does China seize the moment, or simply lay low and provide Putin some cover? During the Cold War, every US presidential election had a subtext which went something like this: can this candidate stand up to the Soviet threat? Can they lead the free world, even if that means edging closer to war? That is a focus which was lost in the postwar period. Now it has returned with a vengeance.

On Valentine’s Day, 2065, the Department of Justice and the Food and Drug Administration dropped a bombshell: the US federal government had initiated criminal conspiracy charges against all major American sugar producers. Based on an enormous trove of evidence, sugar was the culprit for a wide-variety of health problems (obesity, heart disease, some cancers, autism and birth defects, even many mental illnesses). Furthermore, Big Sugar executives knew this as far back as the 1960’s, and engaged in a conspiracy to suppress the scientific data and even blame other products (remember the low-fat craze?). Millions of Americans, and other peoples worldwide, suffered and died due to the corporations’ actions.

Sugar immediately became the most suspect ingredient in history. The processed food industry began a race to the bottom of no-sugar in their products. Restaurants proudly posted signs proclaiming “we serve no sugar” or “take your sweet tooth elsewhere!” Sugar-free advertising became a badge of honor. But it didn’t stop there.

Of course, there was no Sugar Bowl college football game that year, or ever again. American sugar company stocks cratered, and advertisers turned down sugar sponsorship offers. The major media ran in-depth stories about the depth of the conspiracy: lies, pay-offs, political connections. Then media ran heart-wrenching stories of lives destroyed: everything from yo-yo dieters who had wasted their lives not realizing they were fighting a sugar addiction to families traumatized by children with autism or birth defects.

Predictably, the tone changed from the obvious (“Sugar is Evil”) to the more conspiratorial (“who knew what when?”). And there were plenty of targets. Big Sugar had many co-conspirators, from advertising agencies to scientists to politicians who played along. But it didn’t stop there.

Such a vast enterprise, operating openly for so long and causing so much heartache required a full and complete re-investigation of our history. Why didn’t federal bureaucrats stop this sooner? Why did some politicians not make this the top health priority? Why didn’t my doctor tell me? Where were the influencers, the sports heroes, the media personalities on this issue?

And so it began. The statue of former President Ron Desantis, who continued defending sugar long after it was obviously wrong, was defaced several times before being removed. Several high schools named for former first lady Michelle Obama dropped the association, since she was pro-nutrition but insufficiently anti-sugar. The House of Representatives changed the name of the Nancy Pelosi House Office Building to the Victims of Sugar Office Building, noting she never investigated Big Sugar while hoarding her designer ice cream. The University of Florida (America’s largest sugar-producing state) announced full-scholarships for students of families with disabilities associated with sugar use. The American Sugar refinery in Louisiana entered bankruptcy negotiations to settle claims for damages. Candy became a symbol of public disgust: you had to be a certain age to buy it in stores, and it was sold from behind the counter in unmarked paper bags. The NBA eliminated its LeBron James Award for Positive Corporate Relations after it became public he had invested in Big Sugar.

Alright, we’ve gone from the sublime to the absurd, so I think I have made my point. When you retroactively apply the thoughts, opinions, or even morality of today to the past, you must take care. I say this as a person who believes in moral absolutes; I always chuckle to myself when Progressives who say morality and truth are relative (to each person), then apply absolute tests of morality to historical figures. Not much for intellectual consistency, what? And to anyone out there thinking, “but Pat, you can’t be comparing sugar to slavery or Jim Crow or genocide or. . . “, I’m not. I am comparing the use of critical theory to history with a hypothetical future, to illuminate just how ridiculous it is, regardless of the seriousness of the subject matter. Plus, if you want to make the “slavery is far more serious argument”, okay, but what are you doing today given that there are almost twenty-five million people living in slavery now? Want to take responsibility for that? Or for ignoring it?

Much of what I wrote about sugar is true. It would not be surprising if some of the exaggerations I made later prove to be true, too. Sugar is terrible for you, it is addictive, Big Sugar did fight to blame fat for obesity and heart disease, politicians did and do protect sugar producers. And many if not most people know all this. Looking at our current lives with a “sugar-only” lens fails to consider how ubiquitous sugar is in our foods, how it causes cravings, and how many other MAJOR HEALTH CRISES compete for our attention. Life is more complicated today then where you stand on sugar.

One of the worst aspects of woke-ism is the assumption we moderns are morally and intellectually superior (because we are on the right side of history) and thus the application of today’s (superior) views to historical persons, places, or things. One might question the superiority of modern man (or woman). Where is today’s Lincoln or Washington? Da Vinci or Augustine? Mother Teresa or Jeanne d’Arc? We seem to have much more information at our fingertips, yet be much less well-informed. I see little reason to profess our intellectual or moral authority.

This is not an academic argument. The America represented in popular tracts like The 1619 Project is a practically-irredeemable place. As a young man growing up in a small town in Indiana, I was taught the standard fare of American history: the battles and the heroes and the missteps. I also learned about slavery, women soldiers in the Revolution and Civil War, the Japanese internment camps and the Jim Crow South. And I grew up far from any progressive educational paradise. All these things were covered in due course: briefly, and with context. If I had digested the American history put forward by Howard Zinn or the New York Times , I never would have dedicated almost forty years of my life to defending America and it’s constitution. Why defend the indefensible? Is that the goal?

G.K. Chesterton wrote in Orthodoxy, “Tradition means giving a vote to the most obscure of all classes, our ancestors. It is the democracy of the dead.” America, as a nation founded on an idea, has few common touchstones. You aren’t an American because of the way you look, or who you know, how you vote, how much money you have, or even how you got to America. You are an American if you believe in the idea of America. History is one of the few anchors our nation has. It must be history warts and all, as it happened and by its own standards at the time. Otherwise it is not history, it is an immature and unwise form of propaganda.

A violent mob attacks a US government building, seizes and occupies it, and attempts to incite a larger revolt. Order is only restored after violence resulting in the deaths of several of the attackers. The press, local and national, provides immediate coverage of a national sensation, calling the attack an “insurrection”, “rebellion,” or “treason.” The surviving attackers are put on trial. Some media relentlessly hype the story, assessing the profound implications of the attack, how things have permanently changed, that some people can no longer be trusted in any way, that there is no way to compromise with evil.

January 6th, 2021? Nope. October 16th, 1859. The attack is now known as John Brown’s Raid on the federal armory in Harper’s Ferry, Virginia. The parallels are frightening, but instructive. No one called it a raid at the time: that was a convention which only happened after the Union won the civil war. It was an insurrection or treason, and those who engaged in it were so charged and executed. The raucous press came from the technological wonders of the telegraph, just then becoming the means of instantaneous communication. The obsessive media coverage was in the South, which not only viewed the attack as the last straw, but used it to further inflame popular opinion. John Brown’s intent to incite a nation-wide slave revolt struck deeply at the fears of Southern plantation life, where hundreds of such revolts (large and small) had created an atmosphere of panic which only needed a small nudge to disunion.

As a spark along the lines of John Brown’s raid, January 6th pales in comparison. Yes, it was ugly, a stain on our nation’s record, and totally unnecessary. But the proximate cause of our next civil war? Sorry, no. For a moment, let’s consider the counterfactual case: this was the spark, it does lead to civil war. What would that look like? Let’s start with some data, shall we?

This graphic shows how the US voted, county by county, in the 2020 election.

The traditional analysis of this data is the US is a “sea of red” areas with little population surrounding isolated blue city-states. One could imagine a contiguous Red-state region comprising the south, midwest, and mountain states, with blue territory in the DC-Boston corridor, the Pacific Northwest, and Arizona/New Mexico. But such a configuration is more illusory than real. Illinois is a blue state; the area east of the Cascade mountains is quite red. Urban areas across the South are big and blue. There are areas where one can never run into a person of a different political perspective (think Roberts County, Texas, or San Francisco), and Americans are increasingly moving to places which align with their political views, but that doesn’t (yet) make either side a coherent nation when looking at the state level. Which means a Second American Civil War would not be an organized one with armies marching on Capitals, but a disorganized one, pitting armed groups against one another. Less Gettysburg, more like Bleeding Kansas.

Where food is produced (green for crops, orange for herds):

There is an obvious advantage to the wide-open red spaces in that that is where much (but not all!) of the food is produced. The longer the disunited battles go on, the more important the need for food. Sieges and starvation are huge weapons to be wielded under such circumstances. However, the other side of the coin is transportation:

It goes without saying that all forms of transport (and communication) go through urban hubs. So while red areas may produce the food, they will find it difficult to share it, and even more difficult to communicate. To borrow a military term, blue city states may have “interior lines of communication” which give them a natural advantage against larger red areas.

Speaking of forces here are the US Armed Forces totals, 2020:

But where do these service members come from?

I have seen some pundits smirking that whoever tries to start a civil war will be no match for the US military. That is true of course, but neither were the Mujaheddin. The US military was totally unprepared to pacify a small place like Iraq, let alone red or blue America. Occupation and pacification is manpower intensive, and the US military simply “does not have the dudes” as my boss used to say. On top of that, more of those in uniform come from red areas, and while some would honor their oath to the Constitution, others would interpret it differently (same as it ever was). The US military would be riven by the same divisiveness as the rest of the country.

Speaking of weapons, here is a 2020 breakdown on the twenty states with the largest registered gun totals:

The key word above is registered. Only 6 million of the 390 million firearms in the US are registered (according to the Pew Research Center). Read that again. And the vast majority of these weapons are in red hands, in red areas.

So where does the data lead us? We have to make two assumptions here. Which side is provoking the action, and which side is trying to be “left alone” rather than dictate to the other side. I think it is fair to argue red America would be more likely to provoke, but also is more likely to want to be left alone. These are arguable assumptions, but we need to make them to push the analysis forward.

After the “spark,” one would see declarations by various states and areas denying federal control or jurisdiction. Local militias set up roadblocks or engage in raids to seize key infrastructure or to terrorize adjacent population centers. Some rural, red areas would sit out the conflict, either siding with their blue state government (Illinois? New York?) or just passively watching and waiting. Likewise, some major urban areas in the south would choose to go with the red flow. Some deep red areas would barely notice a change: a farmer in Iowa might wonder what all the fuss was about?

Blue citizens in the cities would feel a pinch first. Things like water supplies, power generation, even airports are far enough from urban centers to be at risk of occupation. Of course everyone would notice the stoppage of the free flow of goods and people: something far more drastic and uncertain than anything during the pandemic or even 9-11. One real wild card is information flow in this information age. Blue America would hold an advantage here, with an early monopoly on broadcast and social media. But, it is hard to deny broad area access to the internet for extended periods of time. More likely, information access would be a bargaining chip played against other essentials (water or power, for example).

All this happens as a million scores are settled across the land. Red Americans living in the cities will uproot and flee just as rural or suburban blue Americans do the same when violence, or just the threat of violence, beckons. America is a country with a high tolerance for violence, and a second civil war would challenge the upper limit. The absence of pitched battles does not mean the absence of large numbers of casualties.

Both sides would be exhausted within months. Assuming red America just wants to be left alone, there is no need for storming the Hudson river bridges and occupying Wall Street (literally). Blue America would fairly quickly realize there is no way to force red America to capitulate, and where is Idaho, anyway? Negotiations begin, and some of the more moderate people on both sides would question whether the fighting was really worth it. There is no simple geographical resolution, no two-state solution, as the fighting would have made clear. Who gets the nukes? Who gets the federal debt? The infrastructure was unified and can’t be apportioned. How does the place formerly known as America begin to function again?

I bet the daunting nature of the challenges, the horror at the damages inflicted, and the dim prospects for the future would serve to further a tacit re-integration of the United States of America. The peace process would probably include a constitutional convention to address the root causes and prevent a relapse. Some state boundaries would be re-aligned, and states would acquire more authority over theirs laws and resources, to the cost of the federal government. Red states would use this new authority to cement certain cherished conservative positions (e.g., guns, abortion, voter fraud) and blue states would do the obverse. Blue states would seek to limit resources transfers (via the federal government) to red states. If federal authority is lessened, the US might end up with a weakened President and Executive Branch, a single (unicameral) legislature with a mixed representation by state and perhaps other groups, and a more limited Supreme Court. Deep scars would remain, and the re-United States would need a legal remedy to address the war crimes, expropriations, and other calamities.

In this analysis, red and blue America waste countless lives and treasure to end up back where they started, only greatly reduced and with an enforced national commitment to be civil again. Hardly the stuff of patriot dreams. This is only one hypothetical analysis, but the data provided earlier has real and strong implications. It doesn’t require the gift of foresight to know widespread violence rarely leads to a better life. The common folk, red and blue, know this. Southern newspapers inflamed their readers after Harper’s Ferry, so much so that the South began secession before Lincoln even took office! When you hear talk of another civil war today, ask yourself, “are they trying to prevent it, or foment it?”

Much of the recent focus on the possibility of another American Civil War stems from the coverage of the anniversary of the January 6th attack on the US Capitol. I made the case in the last post that this focus on a potential spark misses the point: we aren’t ready for a spark. But what might push the red and blue extremes to make the psychic break that violence is necessary, and therefor create the conditions for a future spark and conflagration?

The key question is how much respect there is–on either side–for the system of government.

During the first civil war, Lincoln famously made the conflict all about the Union, that is, the system which bound the states together.

If I could save the Union without freeing any slave I would do it, and if I could save it by freeing all the slaves I would do it; and if I could save it by freeing some and leaving others alone I would also do that.

Abraham Lincoln in a letter to Horace Greeley

While Lincoln later ennobled the effort to save the Union by including emancipation, his initial impulse was telling: the American system was worth saving at any cost.

The Confederacy also paid mock tribute from their side, borrowing much language from the US Constitution and making the argument that the issue was state’s rights, not slavery (a red herring, but the attempt shows how important was the need to justify the conflict in terms of the existing governmental system.).

Today there is ample evidence for conern that both sides show fundamental distrust for the American system.

How are our norms holding up? It is easy to point out Team Trump’s “deep state” conspiracy, and Trump himself was to political decorum what Genghis Khan was to the law of war. Now President Biden has called the other side traitors favoring a return to Jim Crow. Senator McConnell famously fiddled with US Supreme Court vacancies, making up new traditions as he went. Majority Leader Schumer is calling to ease the filibuster (he might want to whisper in the ear of the late Harry Reid as he lies in state in the US Capitol, and ask how that might work out the next time Republicans are in control of the Senate). For forty years Republican Presidents found their Supreme Court Justices never quite worked out the way they intended; now Democrats insist the court must be term-limited, expanded, or otherwise neutered to the left’s taste. Don’t even mention the electoral college: I don’t blame the average American for not knowing why we have one, or what purpose it serves. And the constant refrain of “American Democracy” has had the predictable effect of leading people to wonder why the popular vote is irrelevant. All of which is to say, yes, our norms are up for debate by both sides, with neither side seeming to understand that if the rules of the games are gone, we are about to engage in political Calvin Ball.

Well, at least we have legitimate elections, right?

Again, Trump’s nascent 2024 campaign seems to be predicated on discredited theories about voter fraud in the 2020 result. And various GOP state parties are trying to amend state election rules to permit political officials to overrule vote counts. But then don’t forget all those who claim the Supreme Court “stole” the 2000 election (they didn’t, according to the NY Times AND the Washington Post), or that the Russians engineered Trump’s 2016 victory because he was their Manchurian Candidate (he wasn’t, and the Steele dossier was garbage). Stacey Abrams claims she lost the 2018 Georgia Governor’s race due to voter suppression in an election where Georgia registered the greatest increase in average voter participation of any state in thirty years. And now Republicans are banking on rolling back more liberal voting rules introduced for the pandemic, and Democrats are calling it Jim Crow 2.0. Except for one small point. There is no evidence greater turnout favors Democrats or hurts Republicans. There is also very little evidence easy registration, drop boxes, early voting rules, absentee ballots or voter identification laws affect voter turnout. Both sides are posturing about this, and calling into question every election at every level of government. If elections are only legitimate when your sides wins, you have a problem.

What about the ability of the American system to force compromise? That too hangs in the balance. Both sides agree the Electoral Act of 1887 needs to be updated to rule out the type of shenanigans Trump’s lawyers peddled about the electoral count. Yet the Democrats haven’t moved on it. Republicans won’t support any form of lifting the debt limit. The Congress passed the infrastructure bill with bipartisan support, but the Democrats insist on stuffing the Build Back Better bill with items even all the Democrats can’t agree on. Both sides and both Houses are set to pass a budget resolution, but mostly because it will reinstate earmarks (designated pork for one’s constituents). I guess that is some hope: Congress can still agree on bacon.

If you’ve read this far, you may be wondering how I come to the conclusion that we’re not ready for a spark. Our norms are under attack, elections results are questioned, our legislature gridlocked. That’s not a pretty picture, but both sides are still fighting within the system. I don’t think the system is healthy right now; I do think that if either side continues to over-react by challenging the system itself, we will set the stage for eventual violence.

What that may look like I’ll consider in part III.