"How Natural Gas, Cocaine, And A.I.
May Create Food Shortages"by John Wilder
"As we behold that great distortion to the Earth that is A.I., it’s amazing to see how much it is goofing up systems everywhere. First, it is a bigger cash mooch than my high school friend Todd who got hooked on coke (not Cherry Coke®) and was constantly looking for money so he could buy more coke. A.I. is like that, too, but the money is for data centers. Not for running them, so much, but just building and paying for the data centers themselves. The amounts are more than the GDP of any nation in Africa, which isn’t saying a lot, but sooner or later it runs into big money. Why, Anthropic© claimed to have only lost $80 billion (do to an accounting charge) through the first six months, so, hey, what an investment, right? And Anthropic® only has spending commitments of something like a trillion dollars through 2030.
Where is all this money coming from? Well, mainly from places like your 401k, since A.I. companies are selling bunches of their debt as “investment grade”, so if you have bonds, well, you have A.I. all over you. Oh, and this goes for your insurance company, too. It reminds me of Dr. Suess™ and the "Cat in the Hat": “This debt is so big and so deep and so tall, there is no way to pay it.” “No, not at all.”
These are commitments, mind you, that someone is going to be on the hook for. Either the debtor (A.I. companies) pay or the lender (you) does. But let’s pretend that this firecracker doesn’t fizzle out. What else will it goof up? Everything, honestly.
One of those is the cost to heat your home. Thanks to the Green® Energy™ Movement©, coal-fired power plants use The Devil’s Rock®. It’s bad, mm’kay? But people still need power, right? I know that the GloboLeftElite would prefer that we just sit and shiver until our thighs rub together enough to generate enough heat to keep us warm in wintertime, but Ozempic® seems to have ruined that idea as peoples thighs are starting to get lean.
Nuclear? We can’t do that. It’s filled with gremlins and demons and the magic spirit of communism says “No nukes!” so loud the GloboLefties still genuflect to that altar today. Besides, it takes years, is very expensive. Oh, and I’ve shown that there isn’t nearly enough fuel to replace with nukes without massive investments. "The Simpsons, Radioactive Potato Salad, And Running Out Of Electricity": “I have become death, destroyer of worlds.” Had Oppenheimer been a theoretical physicist he would have been frictionless, perfectly spherical, homogeneous, isotropic, involuntarily celibate, and have extended to infinity in all directions. I guess one out of seven isn’t bad."
So, no. That leaves wind, which is inconsistent and not cost competitive or? Natural gas. Natural gas was once regulated and the uses limited to heating buildings. Why? It’s efficient. There’s infrastructure everywhere. And it was consistently produced while demand was lumpy. Make natural gas all summer, and store it in caverns and use it in winter when it’s cold. It was also inexpensive, a cheap way for people to heat their houses without home coal heaters. But those days are gone.
Natural gas is now the fuel of the A.I. boom. That would be okay, I guess, but the Iranians knocked out a huge amount of natural gas production, the Russo-Ukrainian War has removed Russian production from Europe, and it’s projected that up to 7% more of US natural gas production will be shipped overseas by 2030. A.I. will add another 3% to 5% demand by 2030.
I’m trying to tell you that this constant demand will end up driving up prices at minimum, and potentially drive shortages so that houses cannot be heated because there isn’t enough gas in storage. To make matters worse, this will impact food prices as well. How? “We don’t eat natural gas, John Wilder!” you say, and I say: “Yeah, we do.”
Natural gas is the biggest component used in nitrogen fertilizer production. Nitrogen fertilizer is what farmers put on their crops to increase yield. So, either farmers produce less food because they can’t afford the fertilizer, or they use the fertilizer because prices have gone up. There are no other options. There is a technical term for paying more and getting less, and it is called “becoming poor.”
It usually happens because someone squandered their money on something, and now have nothing to show for it. You know, things like a foreign war or a data center that was never completed because they ran out of our money to spend on Sam Altman’s dreams. In truth, I think the A.I. boom is nearly at the breaking point where they are going to run out of our money soon enough. And then? Perhaps a brave leader, inspired by "The Cat in the Hat":
"We’ll have to lift up
All the markets that fell,
Like the stocks
And the dollar and the jobs as well.
Then he said, “That is that.”
And then he was gone
With a tip of his hat."
Nah, just kidding. We’ll have a dictator. I mean, after the war."
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