Let's define some terms, shall we?

I've been AWOL again.  Seriously, some of you should probably try to tie me down and chip me or something.  But a thank you to PatriciaLynn for kicking my butt (gently, kindly).  =)

What have I been doing?  Mainly working, gardening, organizing a co-op, and Occupying.  Funny how in  my case, all of these are significantly interrelated.  Makes for a good life--nice and consistent.

Being that I've spent a fair amount of my recent life involved with the Occupy movement, I've heard a lot of the pros and cons about what we're doing.  Maybe as the days go on, I'll try to talk about them.  But there's one criticism of Occupy Wall Street in particular that I am really, really worried about, because it demonstrates how far down our cultural lack of understanding of our whole financial system goes.  The criticism goes something like this:

"It's not the financial institution's fault that the economy went ka-bloey a couple of years ago.  People took out loans that they couldn't handle.  If you take on a debt, it's your job to pay it off--it's not the fault of the banks that these people have no sense of personal responsibility.  You should either pay off your debts, or you shouldn't take on the debt."

Now, there's obviously a lot going on here, and many ways to unpack this criticism.  We could discuss fraudulent behavior on the part of both the borrowers and the banks, or the wonderful "exotic loan instruments" or the fact that even Dr. Nouriel Roubini (the nobel *ahem* prize winner in economics) said that he couldn't understand the loan documents for his own mortgage.  We could also discuss people who bought way more than they could afford, and who just didn't care or think about the consequences, and the relative lack of personal responsibility on the part of all participants.

But that's not where I want to go here.

The core problem I have with this argument--and I think that this problem is desperately important for everyone to understand--is that all of those loans made cannot be paid back without more debt.  Lemme repeat that:  all of those loans CANNOT be paid back without taking on more debt.  This isn't some deep social critique about the psychology of a borrower or the American point of view, this is a simple mathematical truth.  It is Not Possible for the current loans to be paid back, with interest, without more people taking on more debt, because there will not be enough money to do so without more debt.

Huh?

Um.... what does someone else going into debt have to do with me having enough money to pay my loans off?

Everything.

The monetary system we currently have is designed to ensure ever-increasing debt loads, and in the absence of this, ever-increasing defaults.  Or, to put it a different way, the system we have now is custom-designed to screw us all.  I am not exaggerating here.  This isn't a matter of personal responsibility, it's a matter of structural impossibility.  It's like demanding that someone draw a triangle that has 5 sides--it's not a criticism of the artist if she looks at you like you're a nutjob, it simply isn't a possibility.

I might be able to do a decent job of explaining why this is the case--I've got a pretty good handle on it--but other people have done a better job than me, and in video form!  Here's the shortest one I've seen so far, at ~20 minutes:


The Fractional Reserve System from Greg Stuessel on Vimeo.

This is the core of the story, though hardly all of it (and it's a little heavy on the scare-tactics, which I find wholly unnecessary--the system itself is scary enough).  For more context, check out the link to "Money as Debt" in the sidebar.  And for a very comprehensive, complete understanding of how this fits into our overall economic, energy and environmental system, watch "The Crash Course" also in my link-list on the right.

I wish I could make every person in America learn about this, somehow.  So please, please--if you were with me I would actually be begging you, possibly on my knees--you care enough about the things I do that you read this blog.  Take the next step--watch this video, it's only 20 minutes long.  If you hate it, disagree with it, or whatever else, fine, you're out 20 minutes.  But I'm betting you won't.  I'm betting that quite to the contrary, if you didn't already know what was in this video, you will be very shocked indeed.

Once you've watched this video, I invite you to think about a few things.  (I'm stealing this from the Crash Course.)  Did you know that for the first ~300 years of our country's history, from around 1660 to the mid-1900's, we had no inflation.  None.  Think about that.  Imagine saving $1,000, putting it in a box and burying it, and then your great grandchildren digging up that box and having the same purchasing power that you had when you buried it.  Inflation is not a law of nature, it's a construction of our current monetary policy, which is in fact a very recent invention (broadly from 1913, more literally from 1973).  What does it mean that anything you save becomes worthless?  What does that do to our livelihoods?  Huh.

The Indominable Human Spirit

The sermon today at my church was wholly remarkable. Our new minister, whom I really respect and value, has actually read Dmitri Orlov. Yes, for real. She read Reinventing Collapse (which neither Brian nor I have yet read, more's the shame, although we frequent his blog http://cluborlov.blogspot.com/). And she took it to heart, which is a hard thing to do--the very real possibility that the next twenty years will be completely unlike the previous twenty years, the seismic shifts coming in our economy, and possibly in our lifestyle. She spoke about the rises and falls of informal economies, of barter systems and currency systems and their interplay, and the need to revalue them both in preparation for what's to come (and, probably, for the survival thereof). Now, I should be clear here, given our typical Sunday fare, this was a stunningly gloom-and-doom sermon. We're Unitarian Universalists, after all--we don't go in for hellfire & brimstone and suchlike. This was probably the doomery-ist sermon ever given by our minister, and possibly the doomery-ist sermon ever given from our pulpit.

And yet for all that, and for some obvious psychological needs of both the minister and of our fellow congregants, she endeavored to keep it light. She ended on several upbeat notes, two of which I want to discuss. Well, the first I just want to reiterate, because I think it's not only right, but also important. Even in the midst of a total collapse, people still celebrate birthdays, still get married, and have babies. People still love, and people still dance. Life is still worth living, even if it's a life you never imagined living. Always remember that.

The second point I want to discuss is somewhat weirder. She talked near the end about the "indominable human spirit" and how she was holding on to that feature of us for our salvation. Now, of course I've seen references to this countless times, and almost always in the vein of "our ingenuity will save us". And I agree with that, as a broad statement.

But if you pay attention to the details, there are at least two different things that people mean when they discuss this delightful human spirit. The first, probably most common, and certainly what our minister meant, is not actually a solace of human nature, but of human-created technology. She went on to discuss the inventiveness of us humans, of our new use of biofuels, or solar and wind, and of who knows what else wonders of technology on the horizon that we, as humans, can muster our intellect to command and control. With our stunning ingenuity, certainly we can create paths to a brave new future that looks not like what we live now, but even bigger, even brighter, and even better than what we have now. It is the crisis of the moment that will bring out this best in us--"best" here meaning our scientific conquests which will allow us to pursue our bigger, brighter and better new world. The human spirit (or rather, human technology) will not fail us.

And of course, I have all manner of problems with this sentiment (although I certainly understand the desire to believe in it). The most obvious problem with this attitude is that there are countless instances in the human past where our indominable human spirit has not thrown up technological solutions to the relevant problems. It is ironic that our minister shared this hope against the backdrop of Orlov's work on comparing our own situation with that of the Soviet Russia's collapse. If anyone on the planet has indominable human spirit, it's the Russians, and yet, at least when construed in the bounds of technological advancement, it did not save them. And in fact, they didn't suffer nearly the same level of problems that we are and will be--they have no shortage of fossil fuels on their continent, and yet still their gas stations were shuttered and their electricity was off. We produce less than 3% of our own oil and gas needs within our borders. We've got coal, but a crumbling infrastructure and rapidly decreasing funds to repair it. Biofuels, solar, wind, and ShinyNewPowerX are wonderful (well, sometimes anyway), and will certainly help fill in gaps, but I think it's folly to think that they will somehow allow us to continue our lifestyle, world without end, amen. Plenty of work has been done on this elsewhere, but the short version is that anyone who really believes that wind, solar and biofuels will supplant fossil fuels does not understand how most of them work, and the tradeoffs involved in each. And none of them address the crumbling infrastructure or the stunning economic problems that will prevent any serious implementation of our ShinyNewTechnoligies(tm) regardless.

And then, of course, there's the work from Jared Diamond that helped me reshape my own thinking on the topic of finding salvation through technology. Diamond's book Collapse: how societies choose to fail or succeed, is an overview of five different human cultures which drove themselves to extinction due in large part to their own choices. The motivation for writing the book came from a question one of his graduate students asked while studying the collapse of the Easter Island people, a people who destroyed their own civilization via deforestation--they literally cut down all of the trees. The student asked Diamond "What do you think the person was thinking who cut down the last tree?" What does go through one's mind on the cusp of a collapse? It's a haunting thought, and one we would all do well to meditate upon. Very pointedly, near the end of his book, Diamond writes:

"Technology will solve our problems." This is an expression of faith about the future, and therefore based on a supposed track record of technology having solved more problems than it created in the recent past. Underlying this expression of faith is the implicit assumption that, from tomorrow onwards, technology will function primarily to solve existing problems and will cease to create new problems. Those with such faith also assume that the new technologies now under discussion will succeed, and that they will do so quickly enough to make a big difference soon....

But actual experience is the opposite of this assumed track record. Some dreamed-of new technologies succeed, while others don't. Those that do succeed typically take a few decades to develop and phase in widely.... New technologies, whether or not they succeed in solving the problem that they were designed to solve, regularly create unanticipated new problems....

Most of all, advances in technology just increase our ability to do things, which may be either for the better or for the worse. All of our current problems are unintended negative consequences of our existing technology. The rapid advances in technology during the 20th century have been creating difficult new problems faster than they have been solving old problems: that's why we're in the situation in which we now find ourselves. What makes you think that, as of January 1, 2006, for the first time in human history, technology will miraculously stop causing new unanticipated problems while it just solves the problems that it previously produced. (pp. 504-505)

An interesting meditation, no? Why is it that we are almost religiously placing our faith in exactly what has gotten us into the messes we're in? It's akin, in a way, to our decrying handing over several hundred billion dollars to the bank managers that created the now-defunct credit bubble and saying "fix it". One may disagree, but perhaps now one can understand my skepticism of technology uber alles. Technology has wrought wonders, no doubt, and I think there are many things it has done to make our lives genuinely better. But this isn't different in kind from acquiring a really great new knife. It can make one's life better or worse, depending in part upon how one uses it, and even more depending on the worth one placed in that knife in the first place. If you placed your faith in the new knife, that with it you would rise in culinary prowess to attain the hights of our nouveau celebrity chefs, well... sorry. Or even if you believed that, by getting this knife, you'll actually start to enjoy cooking, again.... sorry. It is our attitude towards this acquisition that makes or breaks its real worth to us, and the same goes for technology.

So what of our indominable human spirit? Should we refrain from placing our faith there? Only if "indominable human spirit" = "human's ability to manipulate technology". But that cannot be all and only what this phrase means. Look again at the Soviet Russians. They are full of indominable human spirit, even though no technological interventions saved their society. And in fact, their culture survived their societal collapse--impressive, to say the least. They did survive, but they did it by finding something to cleave to other than technology.

Our indominable human spirit must be otherwise--it is the source from which our technological inventiveness comes, I think, but it is more. It is the root of our drive to overcome, to perservere. The Russian population understood this. While their leaders scrambled to find large scale solutions to their problems, pretty much none of which panned out, the people got to work adjusting their own lives. They let go of a lifestyle that seemed untenable, and began building a new one. They danced, and sang, and bartered, and had birthdays, and gardened, and scraped, and made toys by hand, and helped their neighbors, and they found a way. That is the heart of the indominable human spirit--to find a way. To limit this spirit to what white-coated scientists (or demin-clad tinkerers) can come up with is to cut ourselves off from our own very real ability to find a way, together with our friends, family, and neighbors. We should not sit and wait with baited breath for the announcement that Science will allow our lives to continue unhindered. Our lives can be bettered now, our neighborhoods can be bettered now. The problems that we must solve derive almost entirely from a culture which has become overly reliant on our technological faith. Go back to the true spirit--the genesis of our technology, and our cultures, and our drive, and our love. The human spirit is all of this. It is what allows us to find value in our children's smiles, and the beauty of a community finding its own spirit again, and the ability to sigh and put away old ways when they no longer work, and to find new ways that will. I believe in the indominable human spirit, and I will gladly put my faith here.

Okay, so what *do* I think is going to happen?

Or, to put it another way--to what, exactly, do I think I will be adapting? Excellent question, glad you asked.

In broad strokes, I think we will be adapting to a world with vastly lower energy availability, and a world with vastly lower economic resources available. Probably, because I just don't see the world running towards the 350ppm goal for emissions, we will also see some serious climate destabilization. This will precipitate huge refugee populations, and also throw monster wrenches into any form of agriculture, including the more localized versions to which I cleave. So, in short, we will have less money and similar resources to use, less energy to do things with, and a significantly harsher food climate than now. Hm. Not good.

Let me fill this out a bit. For starters, I believe that we are heading for a financial catastrophe that will at least be on a par with the Great Depression, and may well dwarf it. We are currently operating under many of the same genesis conditions of the last depression, but this time we are doing it all on much higher orders of magnitude. In the 30's, there were losses in the millions. Today, we're already clocking losses into the 10's of trillions, with vast unregulated shadow markets valued (nominally) at over 500 trillion, all highly susceptible to a credit bubble which just went *poof*. I don't think anyone can truly foresee how bad this will get, and there are so many confounding variables it tends to make my head spin. But at the very least, we are going to see waves of layoffs/job losses (yes, many more than we've had); bankruptcies, both individually and business, will continue to climb. Credit will become almost inaccessible. People with no backup cushion--who had always thought of their home equity and credit cards as their backup--are going to be in deep deep dodo (and I may well be in that group myself). Deflation will batter us for the upcoming future. Prices will fall, but not as fast as wages & income do. We will still have plenty of energy resources--oil, coal, solar, wind, etc.--but we will increasingly not have enough money to actually purchase any of it. As deflation continues, debt burdens will become entirely unmanageable, precipitating more defaults & bankruptcies, and the cycle will continue. Sooner or later we'll hit inflation, and I can only pray that it doesn't turn to hyperinflation and we need a wheelbarrow of $100 bills to buy a loaf of bread, but who can say?

Then there's the energy crisis we're about to tip into. As I just said, oil & coal will still be plentiful, but we won't be able to afford it due to the economic issues. This will mask a new underlying problem that, in fact, our oil supplies will begin to dwindle. No, they will not vanish. There's little reason to think that we'll run out of oil for decades to come. But it will be more and more expensive to get out of the ground and process, and there will be less and less of it. Same goes for coal. So at just the moment when we'll have less budget for energy, prices will likely start to rise again. Market forces will hold prices in check somewhat, since there's no point in producing a commodity that literally no one can afford to buy, but sooner or later it will no longer be cost effective, and then who knows what will happen? One thing that history does teach us is that it was largely cheap-oil driven industry which pulled us out of the last depression; it is doubtful that we'll have another fairy godmother like that for the upcoming one. And no, I don't think that science will save us. I'm a big fan of renewable resources, but they're just not up to the task of taking over for our fossil fuel friends and allow us to keep toodling on our merry way. Their energy returns are too low, their distribution too clumsy, and we don't have the resources left (fossil fuel or economic) to refit our infrastructure anyway. One way or another, we're going to have far less access to energy than we've become accustomed to. Given that most Americans believe that access to oil is a Birthright, this will be a very hard pill to swallow indeed.

And climate change? Well, now that we don't have the money to do all the wonderful green tech retrofitting in the first place, thanks to the economic crisis, we'll start scaling back on those plans (this is already happening). Concern over global warming, which had just finally started to build a head, will dwindle in the face of truly harsh economic conditions. We can only cope with so many crises, and a scientific paper telling us that the global temperature will rise by 2*C just doesn't stand up to seeing your children starving in front of your eyes. Economics will win--just ask Bill Clinton. And destabilized climate will lead to a very difficult agricultural landscape. It's hard to farm when you don't know when spring starts, or if it will start, or when deluge-level floods become the norm, or.... As I recall from my college Anthropology class, one of the major contributors to the rise of civilization and agriculture at all was the eventual settling down of our climate, thanks to the Oceanic Conveyor Belt (which global warming will probably destroy, but no matter).

So there's that.

Bad, eh? Yes, I really do think that some version of everything I just said will happen. But notice that even if I'm completely wrong about one or two of them, if just one of them is more or less correct, we're still in for some major adaptation. I did tell you in my first post that I'm a doomer. I'm not trying to convince anyone that I'm right; I've given no arguments for my positions above (well, not many, anyway). I hope everyone will look into these things for themselves. I've done so, and these are my current conclusions.

Eesh, how can I even get through the day believing things like this? Sometimes I really don't know. But most of the time I do it by remembering that humans do not require, nor do we really seem to thrive, on the modern world to which we've become accustomed. The food is bad for us, the air is bad for us, the consumables are bad for us, and our communities are nonexistent. And so it is to these topics I turn my attention. It is easy to see our situation as the gravest of all possible worlds (short of when the zombies come, I guess); we are talking about the end of our way of life, after all. But I find that I no longer value our way of life, or at least, not what our business & political leaders mean by "our way of life". That way of life involves debt treadmills, and toxic foods, and disaffected youths, and fear. I don't want that life. I want to find the way of life that I think most of us still hold in our hearts, somewhere under the Macy's catalogues and new credit card offers. The life where my neighbor watches my back, and I hers. Where I know who grew my food, and trust that person. Where my spiritual satisfaction does not come from retail therapy. I'll bet you know the world I'm talking about. In fairness, it's a world that never really existed--not even in Norman Rockwell paintings. It's easy to romanticize the past, and I try to guard against it. But it is equally easy--probably even easier--to believe that we cannot live without our current way of life. And that's BS. We can, and we can probably thrive at it, and frankly I don't think we'll have much choice regardless, so I'd better start doing what I can to make the best of things now.

This is just one of the reasons that I do not want to move to a homestead (well, okay, sometimes I do). Homestead living will provide a comparatively smooth transition, and that's great. But nowadays most folks don't live on a homestead--heck, they don't even live on a rural non-homestead patch. Most of us live in cities, towns, villages, and the like. And unless homesteaders are content with angry, hungry, desperate hordes of city dwellers ravaging their fields for food to feed their children (see--zombies!), then we'd better all hope that some of us can figure out how to live with the infrastructure we have now, and who can teach others.

And so, at long last, that's where I am. That's why I'm doing this. And because I'm selfish. I love my house, and I like my community. As a matter of full disclosure, we also have a family "farm" to which we have an open invitation to bug out to any time we need. It's not terribly close by, but it is near enough that, if things were desperate, we could probably bike there with our kids and some essentials in a few days. So we have a luxury that most people really don't--a fallback homestead. But I don't want to end up there, at least not yet. I want to stay here and help my community make it through this mess.

One day I told my mom about my latest canning project and thinking about buying a grain grinder. She sighed and said, "I hope that in a few years you'll be willing to teach the rest of us all these things, because I think we'll need to know them." Well, I'm working on it, mom!