The Middle Class, Energy And Terrorism

The world will not be rid of poverty, war or terrorism until almost everyone on Earth is in the middle class. And that requires energy.Energy use per person is one of the most accurate indicators of what is considered prosperity and happiness. This is not an academic issue as is obvious from the heartbreaking events unfolding across the Arab world.

While some have recently defined the middle class as having incomes up to $200,000/year or more, a more realistic definition can be distilled from many sources – the middle class is the broad group of people who fall socio-economically between the working lower middle class and the upper class, having sufficient discretionary income so they do not have to live from hand to mouth.

The common measures of what constitutes a middle class vary significantly between nations and cultures, and where they fall in their socio-economic development with respect to the rest of the world. The rising middle class in China is different from that in the U.S., but they each have their version of quality of life and aspirations for the future of their children. Absolute money or salary levels are amorphous — $200,000 is a lot in Tulsa, not as much in New York City. $2,000 is an awful lot in rural India. Using energy as a measure is a way to normalize quality of life between nations and cultures.

The Economist recently defined middle class as the point where people have roughly a third of their income left for discretionary spending after paying for basic food and shelter. This allows people to buy consumer goods, improve their health care, and provide for their children’s education and future. It’s why the middle class is so strongly tied to economic and military power.

This definition begins to align with our understanding of what most people in the world aspire to – prosperity, education and increased lifespan. Indeed, the United Nations has developed a measure of quality of life called the Human Development Index (UN HDI). It is directly related to access to energy (HDI Figure below). HDI values fall between zero and one: one is perfectly happy and zero is perfectly miserable. The world presently ranges from 0.28 (Congo) to 0.95 (Norway).

Our own analysis suggests that the middle class begins to influence a society when the HDI exceeds 0.70, and truly dominates that society when it exceeds 0.90. This can be seen in the United States with an HDI of 0.91, China with an HDI of 0.70, and India with an HDI of 0.55.

That energy use is one of the most accurate indicators of what is considered prosperity and happiness is a powerful concept.  Even more important to national security is that energy use trends with life span, peace and democracy (note the country positions in the HDI Figure on the left versus on the right). Therefore, it is unethical and unjust, as well not in our national security interests, not to ensure that the rest of humanity achieves prosperity and long life.

The HDI Figure below shows this as a stark contrast between nations of the world. The developed world, or the industrialized world, is well above 0.8 HDI.  And that has resulted from access to abundant energy. Eighty percent of the world population is well below 0.8 HDI with little or no access to sufficient energy, and that is the root of poverty, war and terrorism.

It takes about 3,000 kWhrs per person per year to be above 0.8 HDI, to have what we consider a good life. The developed world is quite wasteful, averaging about 10,000 kWhrs/person/year. Getting everyone in this group down to about 6,000 kWhrs, and everyone else up to 3,000 kWhrs, would achieve an ethical, and sustainable, balance that is more likely to lead to global peace than any other path (Wright and Conca, 2007).

But there are huge hurdles to this future. Note the position of Iran and Russia. The type of government does matter, and corruption prevents the energy available from being broadly distributed in that society. Both of these countries would be above 0.8 HDI if their governments were not so corrupt. This aspect of government is particularly important to the evolving Arab Spring. The resulting forms of government are critical to their people’s future.

How has energy evolved with society? An adult male human can produce about 11 kWhrs of useful muscular energy per year, which can be multiplied a few times with simple tools, many times with oxen or horses, even more with complex tools, and a hundred times with a diesel backhoe.

The United Nations Human Development Index (HDI) relates energy use to the quality of life to which most humans aspire. The middle class averages about 0.8 on the HDI and requires access to over 3,000 kWhrs per person per year. 80% of the world’s population of over 7 billion people is below 0.8 on the HDI. Source: Wright and Conca, 2007).

Prior to the mid-19th century, 3,000 kWhrs per person per year mostly fell to the aristocracy, ruling classes or the few rich merchants who owned or controlled enough humans and beasts of burden to accumulate that much energy.

The modern energy-abundant world began in the 19th century when technology, material science and basic scientific understanding coalesced with the development of coal in Britain. This caused a rapid growth of a hitherto-unknown group called the middle class. It took about a generation to co-develop the infrastructure, but by 1870, Britain had grown a middle class of about 10 million, dwarfing the rest of the world.

You no longer had to own someone as a slave or a serf to get the energy you needed for a good life.  Since the absolute number of middle class in one’s society determines the economic and military power of that nation, it is no wonder that Britain became the dominant world power in the decades following that growth.

The United States followed suit in the 20th century by developing oil, gas, hydro and nuclear, in addition to coal, and grew a middle class of over 100 million by 1950, and almost 200 million by 1970, leading to our dominance of the 20th century.

But all eyes now turn to China. The United States is 0.91 HDI, China is about 0.70 HDI, and India is 0.55 HDI.  But as recently as 1980, China’s HDI was only 0.40. Political changes in China after 1990 brought in a Politboro focused on expanding energy production, particularly building about 600 coal-fired power plants, and the HDI rose to 0.70 in less than a generation.

However, this 0.70 HDI is a composite of 500 million people above 0.8 HDI and 800 million still below 0.6 HDI. Almost all of China’s policies are geared to raising the remaining 800 million above 0.8 HDI and into the middle class. This should dispel any notion that China’s hunger for all energy sources will slow anytime soon.

This rise has been so rapid that China’s political system has not had a chance to adjust to its new middle class of 500 million. China is on track to have over one billion middle class citizens by mid-century. We know from history that a large middle class is generally intolerant of authoritarian rule, so when China morphs into some sort of social democracy by mid-century, it will become the dominant economic force in the world. The United States needs to be ready.

How does energy and the HDI relate to the events of the last week across the Muslim world? Globally, the HDI has increased steadily over the last 30 years (UN HDI global). But there are only two Arab nations above 0.8 HDI, although several others are getting close. The HDI for specific countries moving across Africa, the Middle East and south Asia are:

Morocco 0.58    Algeria 0.70    Tunisia 0.70

Libya 0.76    Egypt 0.64    Saudi Arabia  0.77

Yemen  0.46    Oman  0.71    UAE  0.85

Qatar  0.83    Jordan  0.70    Syria  0.63

Irag  0.57    Iran  0.71    Afganistan  0.40

Pakistan  0.50    India  0.55
How these HDI values will change in the coming year as the Arab Spring evolves is difficult to estimate, but will depend upon how damaged the infrastructure of each country becomes.

Certainly Syria’s will drop, but Egypt’s probably will not. Iran’s HDI may fall as a result of sanctions against its nuclear program, which have already dropped it’s oil production about 40%, but it should recover quickly if Iran chooses to discontinue their weapons program. It is imperative that the Muslim world increases its overall HDI to above 0.8 for peace to be achieved. The desired socio-economic changes would follow.

In the end, the world needs to achieve a rational mix of energy sources that provides sufficient energy to all people of the world to raise them into the middle class so that we can finally remove the underlying causes of global strife. The amount of energy needed for this to happen is about 30 trillion kWhrs per year, double the present amount ( 

What Is Our Energy Future?). Achieving it will require strong, committed leadership among the nations of the world to a degree never before realized. The world must understand that failure to solve this problem will result in developed nations losing their high standards of living and developing nations losing the opportunity to achieve such standards, while war and terrorism continues and the planetary ecosystem teeters on the verge of collapse.