Showing posts with label debt. Show all posts
Showing posts with label debt. Show all posts

Thursday, 12 October 2023

The Porcupine Saga, Part 5, One Last Lecture, Part 2

Allan Harper, late afternoon, Tuesday, April 9, 2030

Allan Harper checked the time on his phone and cancelled the alarm he had set. If his dad was serious about keeping to a 15 minute break, it was time to be getting back inside. He climbed the steps and went in through the back door of the old farm house, then down the hall to the addition.

"Allan, could you stick you head out the door and call people in?" asked Tom.

"Sure thing Dad," said Allan, turning around to retrace his path to the top of the steps where he called out in a voiced pitched to carry. "Break's over folks, time to come back in."

A few minutes later everyone had returned to their seats in the addition, many with cups or tall glasses of various beverages. Clearly Karen, Allan's mom, had been busy. And probably prepared ahead of time, if Allan knew her at all.

Allan also noticed that the youngest person in the group, the Janes' ten year old son, had been supplied with a stack of books and a box of toys. This lecture Tom was giving was probably pretty boring for the little guy, so it was good to have something to pass the time. Allan rather envied him.

Tom resumed his place at the white board. "Well, during the break I did some quick and dirty polling," he said, "and it seems that, despite having some questions, everyone is on side with my three basic points. That's reassuring" He gestured at the white board where he had listed those points.

Allan noticed that no one objected—it seemed his father had it right.

"I'm beginning to get a better idea of how my presentation today should go, which is good since I'm already about a third of the way through it," said Tom. The audience laughed politely at this bit of self-deprecation and he smiled in response."I can see it's going to fall into three parts. Before the break we talked about how collapse is real, that we can adapt to it, and that the best adaptation is based on community self sufficiency. This second section is going to be mainly about economics and ecology—how this self-sufficient community is going to work. The third section, after supper, we'll talk about specifics of organization and governance—other things we'll have to provide for ourselves."

"So, how is our community going to work?" asked Tom and paused for effect.

"We are now in the midst of a serious economic depression. Capitalism, which we have relied on to provide us with the necessities of life, is failing, and nothing has been organized as yet to replace it. Many of us have found ourselves in a tough spot and we've come here seeking refuge from the storm that has gripped our world.

"But we are creatures of habit and if we don't watch out, we're likely to set things up in the same old way that isn't working, without even realizing that's what we are doing. Before the break I talked about how our community will be egalitarian and based on the principles of primitive communism. I think I neglected to mention that we'll use direct democracy to govern ourselves, possibly because I'll cover it in the third section. But it is another basic element of what I hope we can do here.

"I think these three elements constitute a really strong foundation for our new community. They imply a lot about how that community will function, and by following those implications we can avoid falling into the same old pitfalls. So, I have some ideas about how this should go. As before, I've discussed most of this with at least some of you, in bit and pieces, and now I'll try to bring it all together in one piece, for the whole group."

Tom paused to write on the white board: "Refuge from Capitalistic Society—must be a non-capitalistic society".

"OK, I'm going to start in what may seem like a strange place," said Tom. "And that is with the size of groups we'll be living and working in. The possibilities we will be looking at are: individuals, dyads (two people), crews (three to five people), communes (15 to 150 people) and networks of communes.

"The society we are leaving has pretty much settled on the individual as the only unit of organization when it comes to people. In many ways, the large hierarchical organizations that those individuals work in aren't really human at all. So that's it, just individuals. They're easier to dominate and manipulate, so today's corporations and governments discourage the other sizes of groups. Even dyads, long the basis for fruitful partnerships of many types, are suffering in that society.

"Those other sizes of group have some big advantages and by not using them, conventional society is missing out on a lot of opportunities, of which we will take full advantage. Our basic organizational unit will be the commune, a grouping that is almost completely absent in our society. It brings together enough people to make self-sufficiency possible and to constitute a functioning community. And it allows those people to form the dyads and crews we'll need to accomplish things individuals can't on their own.

"A commune is large enough so that it can be a little cumbersome, so much of the action within our commune will be accomplished by crews. A crew is big enough to make a major contribution but small enough to so it's members can all be on the same page without using any sort of formal organization. Some of our crews will be doing actual physical jobs, others will be assigned to devise answers to questions that would take the whole group forever to discuss.

"The pair bond is evolved right into human beings, so dyads are also a very effective size of group, and sufficient for many jobs. The idea of partnership is basic to dyads, and we'll extend it to the larger groups as well. Sadly we are used to basing relations on dominance and submission. This is a major source of injustice and something we will want to avoid.

"Someday, years down the road, we can hope that others will adopt our approach and we can have a network of communes similar to ours."

Tom turned to the white board and wrote, "Organizational units: the commune, the crew, the dyad and the individual. Someday, a network of communes".

As a tradesman, Allan had done some work in crews and knew how effective they could be, even in a capitalistic organization. Communes were a new thing for him, though he had to admit that this particular one seemed to be working OK, so far.

"I would have thought extended families would have an import role to play here," said Jim MacGregor, "but you haven't even mentioned them at all."

"I have nothing against extended families," said Tom, "clearly, since I have both children and grandchildren in this room. They say it takes a village to raise a child and a commune can play that role. But I didn't mention extended families because capitalism uses families, be they nuclear or extended, to do the reproductive labour required to maintain society without any support from the capitalists. Even though they clearly benefit from that labour, they have externalized it from their own organizations and left the burden sitting squarely on the family.

"This is actually a pretty good example of one of those habits we want to avoid. We'll want to strongly support those who bear, raise and educate our children. And how we do this may end up look quite different from the traditional family. It will be interesting to see what develops."

"Oh," said Jim, "I guess I am an old fashioned guy and I hadn't thought of it that way. But I do see what you mean."

"Great," said Tom. "we all have some work ahead of us when it comes to following those implications I was talking about.

"Anyway, next we need to look at economics. We're used to spending our time working for capitalists, producing commodities or services. Even those of us who are self-employed end up working for the capitalists at the bank. So, they sell those commodities and services, and use some of the money they receive to pay us for our labour, at the lowest rate they can get away with. The rest they keep, to re-invest in their businesses or in other areas for the best return they can manage, always aiming to accumulate more wealth. Having 'enough' simply doesn't enter into it

"Because we've had a consumer economy, if wealth is to be accumulated goods and services must be produced and consumed, regardless of whether they are actually needed or not. Indeed a lot of effort is expended to create artificial demand for whatever the capitalists are set up to produce. This is known as "supply push". And it, along with the endless accumulation of wealth by capitalists, results in our impact on the planet being much heavier than it really needs to be.

"Here we have a different goal, and we will be adopting a very different approach," said Tom. "That goal is surviving, and surviving well. Our labour will be used to supply our needs—water, food, clothing, housing. Once those are taken care of, we'll see to other needs that are less urgent, but still very real. I would encourage us not to fuss much over the gray areas—if we decide to put our time and effort into a thing, we should call it a need. We'll make things (and services) because we need them—this is known as "demand pull", and it has the potential to put us in a situation of abundance that has a much smaller impact on the planet than a supply push economy—we'll only make what we need, and don't have to support the continuous drain of wealth accumulation by capitalists."

"But exactly how would such a demand pull economy work?" asked Tom. "Remember that we want to base it on communistic rather than capitalistic ideals.

"I'll start with ownership and property. Ownership is one of those artificial concepts that has become central to our society. But there is nothing fundamentally real about the concept of owning things. It is one of the fictions that is accepted by everyone as necessary to making society work. What it actually does is make things work for the 1% at the top. In fact, you own the things you can hold onto. Our laws, courts and the police exist largely to help the rich hold onto what they think of as their own. Some benefit does slop over into the middle and lower classes, but if you've ever had something stolen and called the police, you've seen how small that benefit really is."

"I didn't bring much with me, Grandpa," said Tom's step-granddaughter Andrea, "but aren't some of the people here going to be pretty upset if you take away all their stuff?"

"Not so far, Andrea. But then I'm not actually taking away all their stuff," answered Tom. "Let me explain. Property comes in three varieties: personal, private and collective. Personal property includes, at the very least, things like your clothes, shoes, toothbrush and nostalgic items like family photos and keepsakes. You came here with it and you get to keep it. I suspect we'll also come up with a list of personal necessities that we'll supply for everyone, as some people are going to arrive with little more than the clothes on their backs.

"But, in the society we have left behind, a typical household has a lot of stuff that I guess you'd consider personal property. Take the kitchen for example—each household has a whole bunch of appliances, equipment, cutlery, china and so forth. We're going to have one central kitchen that looks after everybody and eliminates a whole lot of duplication of personal property. Another example would be guys like me having a well outfitted shop with a bunch of power tools that get used pretty rarely. We're going to have a 'maker space' and a tool library which eliminates a lot of duplication in those areas."

"There is a somewhat fuzzy line between personal and private property, and no doubt we'll spend some time over the next few months discussing exactly where that line should fall. One of the definitions of private property is that you use it to increase your private wealth. Of course, as a member of our commune, you don't have private wealth, so you don't need private property.

"The third type of property—collective property—belongs to us all," said Tom, " and much of the property that we are 'taking away' falls into this category. You won't be losing it, just sharing it."

"Ask anybody here," said Andrea, "we can all tell stories about common property that get's abused, broken, stolen and so forth."

"I know what you mean," replied Tom. "I've seen those things happen too—in an organization I was in charge of, actually. Close examination has lead me to believe that the people involved didn't really feel any responsability for the stuff in question or expect any consequences when they abused it. Here, the common stuff belongs to us all and that means it belongs to you. If it gets broken or lost, the replacement comes out of a common pool of resources. Resources that could have been used for something else that you wanted instead.

"On the other hand, it's important to remember that, in the normal course of events, things do break and get lost and not to get too worked up about it."

"Yeah, you got some good points there, Grandpa," said Andrea.

"Thanks, Andrea," said Tom. "The next thing is work and money. In the world we are leaving you work to get money so you can buy the necessities of life, but with no guarantee that what you earn will be enough. This doesn't apply here, as the commune provides those necessities. Still, we are all going to do some work as part of our lives here. At a minimum, this will be the work that's needed to provide for all of us.

"I am not proposing that we get paid for this or any other work we do here," said Tom. "Indeed I am quite certain that we don't need to use money internally at all. This place will work just fine without it. And I am not suggesting we replace money with some sort of barter system or even a time keeping system. I don't believe that we need to formally keep track of how much each of us does—indeed we'll be better off if we don't. We should switch from extrinsic rewards like wages to intrinsic rewards like knowing that you are helping the members of your community and doing a good job of it.

"For most of our history (or perhaps I should say prehistory) barter and trading (commerce, if you will) were something you did only with strangers and usually with an eye to, as my dad used to say, 'putting one over one them'. When dealing with the members of your own community, you simply shared and did what was needed to make sure everyone had enough.

"In one sense, money is just a set of tokens used to keep score in the complex game that is our economy. Energy is what really makes an economy work, and we'll have our own renewable sources of energy here, mainly firewood. So money in this sense won't be very important to us.

"But in another sense, money is used by the rich to make more money, and control everyone else. In the society we are leaving, money severely limits our options because there is so little we can do without it, and borrowing has become the only way to get enough money to do anything significant. Because it is created via debt and must be paid back with interest, money drives the continual growth of the economy. Having abandoned money we will have eliminated the need for on-going growth and once again reduced our impact on the planet.

"I believe we will find this approach involves less effort to secure the necessities of life. Less than the regular jobs we've been working at, for sure. I think we'll also find it will take less energy and fewer material resources. And it should be much less of a pain in the ass, since we'll be working as part of a partnership we've voluntarily agreed to, rather because some idiot above us in a hierarchy tells us to."

On the board Tom wrote, "Eliminate money, accounting, banking, debt, and the need for growth." On the next line he wrote, "Personal, Private and Collective property." And then stroked out "private".

As a union member, and in his most recent job a union organizer, Allan had developed a pretty strong class consciousness, so he had no problem with this kind of talk. Others weren't so quick to accept.

"That doesn't sound fair," said Nora McGregor, a slim, gray haired women wearing glasses, who was, if Allan remembered correctly, a retired elementary school teacher, "if the most competent people give their all, they'll end up contributing a lot more than lazier or less capable people."

"Fair is only in fairy tales," replied Tom with a grin, which drew a frown from Nora. "But seriously, it is true that some will do more for the community than others. Hell, some of us could probably make a go of it as an isolated individual or family, without the need for a community. But it would be really hard. As members of this community, those exceptional people will have a much easier go of it than they otherwise would. They will be significantly ahead of where they'd be without the community.

"Indeed, none of us should have to go full out on an ongoing basis, or this isn't going to work. Without capitalistic waste, and with the force multiplier of mutual aid, we should all have some time for the things we love to do, and even to be a little lazy. Laziness should not be discouraged when there isn't much to do, and we will set things up so there are times when there isn't much to do, as we have no need to over produce or over consume.

"That's how it worked for the most competent people in those egalitarian bands. They did contribute more, and were expected to share with others who contributed less. If they got uppity about it, they were made fun of, slapped down, and in extreme cases encouraged to go elsewhere."

"The more you say, the worse it sounds to me," said Nora.

"Look, we've all been taught to accept this odd idea of fairness—that if we work hard we'll be compensated fairly, and if we don't, we haven't earned any reward," said Tom. "This is intended to keep our noses to the grindstone, but the only people who really benefit are the capitalists who are exploiting us. It is not fair at all and it totally ignores some of our basic human rights—I mean, what are the people who haven't managed to earn a reward, frequently through no fault of their own, supposed to do?

"We are so immersed in ableism and meritocracy that working to help our community, even if some of its members haven't 'earned' it, sounds backwards to us. But I'll tell you it is the most forward thing you'll ever find. Who would you rather help? Your family, friends and neighbours who genuinely need your help, and most of whom help you as much as they can, or rich people who just want to get richer and don't give a damn about you?"

"When you put it that way," replied Nora, "maybe it's worth a try. We'll see how it goes, anyway."

"Indeed we will," said Tom, and turned to write, "Eliminate ableism and meritocracy. Guarantee basic human rights"

"If my analysis is right, you'll find that on average you'll be working something like 32 hours a week," said Tom. "About half of that will be on 'shit jobs'—work that needs to be done whether you like it or not. You'll do it because you recognize that it does need to be done and if not by you, then who? The other half of will be spent doing what you want to do to help the community. Of course, there will be lumps in the work load, busy times when everyone is working long hard days, and slack times with the opportunity to take it easy.

"Fortunately the forces of capitalism have been sufficiently weakened by the depression that we are going to be able to try all this out without the opposition you would usually expect, and without enacting any formal land reforms," said Tom. "Provided we keep a low profile, and don't stir up trouble the local government or the police, that is.

"Since the start of the depression in the fall of 2028, the offshore capitalists that technically owned this land have disappeared. They are not answering their phones and have stopped paying their taxes and stopped renting the land out to local farmers for cash cropping. The depression has hurt those farmers, leaving many them in no position to plant a crop, even if they were inclined to do so without a formal rental agreement, so we don't have much competition for use of the land hereabouts. The hundred acres we're sitting on was for sale for back taxes. Of the other nine hundred acres in this concession, seven hundred are in circumstances similar to this farm and two hundred are owned by a farmer who is my age and I suspect would like to retire. We should approach him soon.

"As the depression deepens and governments at all levels lose more and more of their ability to project force and control the situation, we may well be able to just squat on much of this land without paying taxes—making good use of it, rather than letting it just be taken over by thorn brush. And hopefully using what we produce on the land to help those less fortunate in the local community.

"It's a bit of a wild ass guess, but I've been basing my thinking on needing around five acres to support each person," said Tom. "You hear people talking about needing as little as a quarter of an acre, but that is for a vegetable garden only. I'm including producing firewood, building materials, fiber, vegetable oil and alcohol as fuel, as well as food. Add in some scrap metal and we should be pretty much self-sufficient. Of course, this year, until the first harvest starts to come in, we'll continue to buy food and other necessities. And initially we'll have to spend some money on tools, equipment, seeds, nursery stock and livestock."

On the board Tom wrote, "Informal Land Reform, facilitating Self-Sufficiency"

Working five acres of land sounded to Allan like something that might take more than 32 hours per week to work. He was about to speak up when his step-son Miles beat him to it.

"Grandpa Tom ," said Miles, "how do you figure 32 hours a week is going to be enough to take care of five acres of land?"

"Because more than half of that five acres is going to be in woodlot, supplying us with building materials and firewood," said Tom, "of the rest, some is going to be in orchards, field crops, pasture and hay, which we'll work mainly using machinery, driven by tractors or work horses. So this brings us back to about a quarter of an acre of vegetable garden, and even there much of the work can be with machinery."

"Oh," said Miles, " I thought you meant five acres of garden—twenty times as much as that quarter acre. But even a quarter acre is a square a little over a hundred feet on a side. That's still a pretty big garden."

"I won't argue with you there, Miles," said Tom. "It's never been clear to me whether that's supposed to be a quarter acre per person or per family. I grew up on a farm, and we had about a third of an acre of garden, where we grew most of the vegetables for a family of five. So a quarter of an acre is probably a generous estimate. Still, there will be times—planting, weeding, harvest—when some long days will be required of many of us. But averaged over the year, gardening doesn't add up to anywhere near 32 hours a week, so we'll have lots of time for all the other things that need doing."

Miles let it go at that, but a short and curvy young woman spoke up, "So as you say, at the start, we'll be buying more than we produce. Where are we going to get all the money for that?"

Alan thought for a moment and remembered being introduced to her as Angie Ferguson, a hair stylist.

"Money raises its ugly head again... well, I guess I may not have explained this to everyone yet," said Tom, "I expect that the majority of people seeking refuge here will come with little more than they can carry—personal property only and little or no financial resources of any sort. That is the point of having a refuge, after all. But the older folks in this room did come with somewhat more— savings, investments, and pensions—the usual government pensions for those who are over 65, and in a couple of cases, company pensions earned during our working days. These are private property and have already been signed over to our collective.

"So, with those resources, it looks like we've got enough income to keep us all fed and otherwise cared for until the crops start coming in. Also to buy what we'll need in the way of seeds, tools and so forth, and to pay the property taxes on this farm. Some of us have brought part of what's needed with us, and that will save us quite a bit of money."

"Good for you. And good of you older folks to be so generous," said Angie.

"Well, I have to admit we are not altogether altruistic in this," said Tom. "Realistically, if the depression continues as we expect it will, we're looking at those pensions getting discounted soon and eventually disappearing altogether. Our investments won't be reliable either. So we wanted to 'use them before we lose them', so to speak—to create something that we can count to support us as we get older, even if our civilization collapses."

"And in the setup you've been describing, us younger folks will provide that support," said Angie. "Not a bad deal either, since none of us have the resources to set up a place like this on our own, and there will be only a few of you and lots of us."

"I'm glad to hear you feel that way," Tom replied. "though I'm not keen on us being divided into 'you and us'."

"Just a figure of speech," said Angie.

Allan hoped it was. He could see real problems arising if a rift developed between those who had bank rolled the operation and those who ended up doing most of the work. It didn't need to turn out that way, but it easily could.

"Do you think we'll ever be able to make everything we need?" asked a muscular man in who appeared to be in his thirties.

He'd been introduced to Allan as Don McPherson, a fitter mechanic who did blacksmithing and foundry work as a hobby. Clearly a useful fellow to have, and with a keen interest in "making".

"That's mostly a matter of how you define need, " replied Tom, "and how much in the way of money, material resources and effort we're willing to put into any particular thing. At least here we'll have a much better idea of the real cost of things than we did as part of consumer society. Very soon we should start working on a wish list. This, I am sure, will spark much discussion about what we can produce here and what we really need. Some things may always be beyond our reach—solid state electronics and the high end of pharmaceutical and medical tech come to mind."

"I'd agree with you there," Don said, "and I'd add in plastics and rubber, and possibly electricity itself. But maybe that's because those things are outside my 'wheelhouse', so to speak."

Allan, an electrician himself, wondered if he should speak up, but Tom beat him to it. "As an electrician, I can tell you that electricity really isn't that hard. The hard part is providing energy for the prime mover that spins a generator. Even without solid state electronics, we can use wind, solar thermal and of course, firewood. This may not get us the essentially infinite amounts of power that we're used to, but enough for the basics. Electricity is so useful, especially for things like pumping water, refrigeration, lighting and operating power tools, that I have no doubts we'll find a way to generate some. Not just today, but in the future when all our store bought generators have broken down and we have to build our own."

"Oh, for sure," said Don. "Our current level of technology looks like magic to many people, and it is supported by a global network of such complexity that it might fall apart if any one link fails. But there are suites of technologies that require much smaller and simpler networks. With already existing tools and knowledge, and the extensive opportunities for salvage that currently present themselves, we are in a much better position than those who developed those technologies in the first place."

"Absolutely, Don," agreed Tom, "and the rest of us will be relying on folks like you to make such ideas a reality. Especially since that global network seems ready to collapse at any moment. Thinking about that sort of thing, it's going to be interesting to see how long our governments can continue funding it's new dental and pharma plans, as well as the medical system, and how long much of the technology involved will be available. At some point we're going to have to start doing that sort of thing for ourselves, and it will be a big challenge, especially since most alternative medicine simply doesn't work. In any case, I hope we will be able to attract more pharmaceutical and medical people in the near future.

"It might surprise you to know that we already have among us a person who has worked in the biotech industry—my daughter-in-law Erika. She has brought with her a couple of strains of gene tailored bacteria. One produces insulin. I don't think we have anyone at the moment who is insulin dependent, but it's bound to happen as we welcome in more people. The other produces chymosin, an enzyme used in cheese making. She has connections in the field and intends to obtain more cultures for some of the things we couldn't make otherwise. We don't have the tech to engineer these bacteria ourselves, but we can certainly make use of them once we have them."

Allan turned to Erika and said in a low voice, "That's a lot on your shoulders."

"They're broad ones, my dear," she said, "and a good thing, 'cause as he says, there's more yet to be done."

Tom paused for a moment, looking around the room. "I see no one is raising objections to genetically modified organisms, or to my comment about alternative medicine" he said, "it's a big relief to see that that sort of irrationalism hasn't thus far taken root here. As far as solid state technology goes, well, that's a big reach. But lighting is something I don't think we'll want to give up and the efficiency of LEDs argues for putting some effort into producing them, or at least something of similar efficiency. In the meantime, we'll stock up on useful things like that, and it will be quite a few years before the last of the existing LED bulbs gives out on us."

"Anyway, having mentioned five acres per person I think it is time to bring up another concept—that of carrying capacity, and with it the idea of overshoot," said Tom.

"This may be less familiar territory for typical western leftists, who have a tendency to confuse the real physical limits of the planet we are living on with artificial shortages, created by capitalists to keep prices up. The assumption is that if you're talking about limits, you're actually trying to sneak artificial shortages in under cover. We've been told that if we get rid of capitalism and redistribute the wealth more justly, there will be enough to go around for everyone. And if there are real limits, we're nowhere near them yet.

"I think this is pretty unlikely. The best estimates I've read have us already 170% into overshoot. That is, we are consuming 70% more than the biosphere can produce each year, and in the process damaging the biosphere and reducing its carrying capacity. We are also using up non-renewable resources like crazy, without any plan for what to do when they get depleted.

"Carrying capacity is one of those real limits, and in this context, it is simply how many of us a certain area of land can support on an ongoing basis—sustainably, as they say. Of course, this depends on the piece of land—how much it has to give. And on how we choose to live—how much we take from that land. The single most important thing to understand is that in the short term we can take more from the land than is implied by its carrying capacity, like withdrawing the principle of an investment, rather than just living off the interest. When we do so, we degrade the land and actually reduce its carrying capacity. Overshoot is the term used to describe this situation. In the long term overshoot leads to ecological collapse.

"As I said, currently, for the planet as a whole, the human race is in overshoot by about 170%. That's pretty scary, but by being aware of it, and exercising care to stay within the carrying capacity of this chunk of land, I think we can have a decent life here and be generous to the community around us."

On the board, Tom wrote: "Carrying Capacity, Overshoot and Resource Depletion"

At this point Allan had had all he could take. "Just stop right there, Dad," he said, "there's a name for what you are talking about—Eco-Fascism. It's what rich people on the right use to justify austerity and population control or outright genocide for poor countries who they think have too many people. Anyway, carrying capacity is a thoroughly debunked concept. With better technology, the land can support more people. From the sound of this I don't think you're a leftist at all—just a crypto-fascist."

Tom was silent for a moment, his face flushed. "First, you want me to run this place, now you call me a fascist," he said. He paused for another moment, shaking his head, then said, "I am out of here."

He set down his marker on the ledge at the bottom of the white board and stalked out of the room. A moment later, the outside door closed with a bang.

Looking around the room, Allan could see shocked expressions on many faces, though for a start, no one had anything to say.

Then Karen, Allan's mother and Tom's wife, who had been quiet throughout, stood up. "Well, Allan, you caused this problem—I suggest you fix it. Give your dad some time to calm down, and then go find him, apologize and let him explain what he's talking about. See if you can get him to come back. I think you'll find him in the first pole barn. In the meantime, we should get supper on. Anybody want to help?"

Then she left, heading for the kitchen, followed by the handful of people who had been helping with meals for the last few weeks. A buzz of quiet discussion rose throughout the room.

Allan didn't know what to say. Erika looked at him with a quizzical expression on her face. "What the hell was that about?"

"Just the latest episode of a long standing argument," said Allan with a sigh.

"Yeah, well I don't usually like it when your mother gives you orders," Erika said. "But I think you really fucked up this time, and you'd better try what she suggests."

"Oh, I'm gonna," replied Allan. "I just hope I can talk some sense into him."

"Or maybe he can talk some into you," said Erika. "I'm off to the kitchen."

Allan nodded but said nothing more, just sat there with a thoughtful look on his face. It was almost half an hour later when he got up and headed outside to look for his dad.


Coming soon, The Porcupine Saga, Part 6: The Sign Above Our Gate

The ideas about group sizes and their functions comes from the Microsoldiarity website. Lots of good ideas there, about how to foster belonging in groups and partnership rather than domination/submission, as well as the group sizes thing.



Links to the rest of this series of posts:
The Porcupine Saga

Maintaining the lists of links that I've been putting at the end of these posts in getting cumbersome, so I have decided to just include a link to the Porcupine section of the Site Map, which features links to all the episodes I've published thus far.

Wednesday, 5 January 2022

Collapse You Say, Part 10/Time for Change, Part 1: Money

Waves, rocks and ice on the Lake Huron shore

Earlier in this series (Parts 5 and 6) I looked at overpopulation and overconsumption and concluded that while both are serious problems, overpopulation is going to take decades to solve, while overconsumption could be addressed quite quickly. By reducing our level of consumption, we would reduce our impact on the planet and give ourselves time to reduce our population.

In my last post I looked at some of the unintended and negative consequences of the industrialization we've experienced over the last few centuries. I concluded that most of the blame for overconsumption can be laid squarely at the feet of capitalism, with its insatiable hunger to accumulate wealth, its inescapable need for endless growth, and its inability to tackle any problem that can't be solved by making a profit. These days some people are calling capitalism a "death cult", based on those characteristics and the fact that we live on a finite planet. I think they are quite right to do so.

Clearly, the blame for overconsumption should not fall on the supposed innate greed and materialism of individual, ordinary people. The upper classes (mainly capitalists) are superlative consumers and do a great deal of harm themselves. And their marketing efforts have turned the rest of us into pretty good consumers, too. Turn off their incessantly blaring marketing machine and things would be quite different—reducing consumption would look at lot more doable. We'd have a real chance of solving both of our major problems (overpopulation and overconsumption), getting ourselves out of overshoot and avoiding at least part of the die-off that is currently looming ahead of us.

It seems that at this point in this series of posts I am done trying to show that collapse is real and I'm ready to look at what we can do about it. And that is why I am changing the name of this series in the middle of it. It is, indeed "time for change". In truth, I probably should have made the name change starting at Part 7, but it's too late for that now.

Of course, many people in the "collapse sphere" will tell you that what we face is a predicament, not a problem—in the sense that it can't be solved, only adapted to. To those folks I would say, relax—I agree. My idea of a solution to the problems facing us is for us to adapt to them, and that adaptation will probably look a lot like collapse to many of you. We need to have fewer people, all consuming at lower levels that can be sustained by the biosphere, and we must start using up non-renewable resources at a drastically lower rate, until we can manage to replace them with renewables. To quote John Michael Greer, we need to get by with LESS—less energy, less stuff, less stimulation (entertainment). If we choose to do nothing, we'll get there via a brutally hard and deep collapse. But if we deliberately work at adapting instead of trying to save "business as usual", we can get there by a much gentler route, with a lot less grief, and with a better outcome at the end. Still involving major changes to our supposedly "non-negotiable" lifestyles, though.

At the end of my last post (months ago) I promised to tie up a couple of loose ends in my discussion of finance and government, and to talk about how to solve our overconsumption problem by getting rid of capitalism. Over these last few months, I've come up with a wealth of material on these topics and so what was to have been a single post will now be broken up into at least three: I'll be talking about money (finance) today, hierarchies (government) in my next post and what to do about capitalism in the one after that.

Money

Money is a tool and, like all technology, it is not neutral but is designed to be used by certain people for a certain purpose. Money is used by rich people to make more money—to accumulate wealth, and to control poor people. Sure, it can be adapted to other purposes, but I don't believe we can ever stop it from being used for those basic, inherent purposes.

If you study basic economics, you'll be told that money has three primary uses: as a medium of exchange, a unit of account and a store of value. All three of those really just amount to keeping score in the complex game that is our economy. That score keeping is done in ways that facilitate the business of accumulating wealth. This helps those with lots of money get more of it, and works against those with little. We are told that not keeping score would be even worse, but the more I look into it, the less reason I see to believe that.

Capitalism started out with capitalists using their own money to build infrastructure (factories, mines, railways, etc.) to build stuff, which could then be sold for a profit. This soon changed to using borrowed money to do the same. The banks did very well on that, and before long the other capitalists saw that it is possible to use money directly to make more money, dispensing with factories and production of physical goods. This is known as "financialization" and while there are still lots of factories, making lots of stuff (much of it unnecessary), the financial sector is in some ways the business success story of the last century.

Unfortunately, our financial system creates money as debt, which must be paid back with interest. In order to do that, the economy must continually grow. If growth stops or even slows down, it collapses. At the same time, the eventual consequence of growth is also collapse.

The other primary use of money is as a tool for social control. Everything we need has been monetized—the only way to obtain the necessities of life (and much else) is to pay for them with money. Only a very few people live self-sufficiently today, outside of this system. The rest of us need money to live, and a job to obtain that money. In capitalist societies, most of the value created by your work goes to the capitalists, with as little as possible going to you as wages. This makes it challenging to get ahead.

During my lifetime, it stopped being possible to save up enough money to buy large ticket items like an education, a car, a house and so forth. For most people, especially those without rich parents, such things are necessities and can only be had by going into debt to get the required money up front. And it is getting harder and harder to pay back that debt. But that debt must be paid back is a strong value in our culture. To declare bankruptcy and effectively have your debts forgiven means losing essentially everything you have worked for. This leaves us in a position of being under the control of the banks, with very little that we can do about it.

If you look closely, though, you'll see that while not paying debts has nasty consequences for the lower classes, people in the upper classes can often come to some other arrangement if their debts become too onerous. In particular, capitalists whose businesses fail often walk away with little or no consequences since those businesses are set up as corporations with "limited liability".

So, it's pretty clear that in any society that uses money (keeps score) and makes accumulation of wealth a goal, the result will be ever growing inequality between the upper classes and everyone else. In the past, many societies that used money and debt, even without capitalism in the modern sense of the word, found that for the lower classes debt grew over the years until it crippled society. That was because the lower classes played an important part in those societies and when they were crushed under a mountain of debt, the whole society was negatively affected. It was necessary to have a "jubilee" every so often and forgive debts in order to get things working again.

But under modern capitalism, that's never going to happen—the lower classes are, to an ever greater extent, seen as not having an important role to play. Much of traditional work has been replaced by automation. If we are crippled by debt, it doesn't immediately bring our whole society to a halt. Indeed, much of that debt is held by the upper classes, who see it as a benefit. For the rest of us, debt offers a means to allow us to continue consuming, borrowing money just to give it back to the capitalists, with little time for thought about long term consequences.

Most of us are like fish swimming in a sea of money and monetary concerns, unaware that there is any alternative. We are certainly told that there is not. But we need to ask ourselves if money and this whole "keeping score" thing is beneficial or even necessary? Is there any way we could manage to get by without money?

Economists will tell you that money was invented to get away from the inconveniences of barter. But anthropologists who have actually studied pre-monetary societies, would tell you that that is nonsense—barter was used rarely, mainly for trading with strangers. Inside a community, among people who know each other, there are ways of living without money or barter. We'll go into more detail on that in a bit.

Conservative moralists, who have a great deal of influence these days, are concerned about "moral hazard"—telling us that keeping score using money is necessary to maintain fairness, and make sure that people don't take advantage of each other. In fact, very few people do take advantage. And keeping score mostly leads to growing inequality, which is in itself unfair.

And, of course, accountants would have us believe that the whole of modern civilization would grind to a halt if their ledgers didn't balance.

That's all very convenient for those at the top who actually do benefit, but most of these things could be eliminated without hurting the rest of us. And what's really necessary could be rearranged to benefit us and not just the rich.

If we turn to the study of anthropology again, we find that quite frequently during our prehistory we lived in small egalitarian bands who did just fine without money and largely without keeping score. What little score keeping there was, was informal and aimed at censuring people who didn't share well, to prevent accumulation rather than facilitating it.

For such hunter gatherers getting an adequate supply of protein was often challenging and that is one reason why hunting larger game was done enthusiastically, even though it was often not very successful. Hunters were expected to share the meat when they did make a kill, and generally did so, without expecting thanks or any special treatment for making this contribution.

Scientists studying such societies have observed that altruism (sharing) is a strong part of the culture, and have been puzzled about how altruism could be selected for on an evolutionary basis. It would seem that any individual with an inclination to share would inevitably be taken advantage of by less altruistic people, and individuals with innate altruistic impulses would soon be selected out of the gene pool. And indeed they would have been, if selection was acting solely on individuals. But selection also acted on the level of bands, and bands whose members shared well did better and were selected for strongly enough that such behaviour was eventually evolved into human beings. Mutual aid is a powerful tool for achieving success in groups and a major factor in the evolution of many species, certainly including our own.

Even today one can observe that there is a great deal of benefit to acting on a basis of mutual aid, working together altruistically in groups. In societies such as ours where there seems to be an ethos against altruism (a la Ayn Rand), people still do act altruistically, often as if compelled to do so. This tends to reduce the effectiveness of money as a control mechanism, and so it is not popular with those in power, but it still happens. And even in large capitalistic companies, in those cases where people are still working together in groups, you will find a co-operative, egalitarian culture, because it is the best way of getting the work done. Of course, management prefers to isolate workers, so as to better control them. Solidarity is a dangerous thing, from management's viewpoint.

Hunter gatherers had very little in the way of possessions—their nomadic lifestyle didn't allow for much in the way of accumulation. So you might say that money would have been of little use to them anyway.

But many tribal societies practicing herding or even sedentary agriculture, who had more in the way of possessions, and more opportunity to accumulate wealth, often got along without money or score keeping as well. In some such cultures, when you compliment another's possession, the owner is obligated to give you that possession. Strange as it seems to us, this is the basis of exchange in these societies and it works just fine for them. Since everyone is subject to the same rules, being greedy backfires very quickly.

It has become clear to me that the concept of fairness is quite different between monetary and non-monetary cultures. Diametrically opposite, in fact.

In our monetary society, fairness means playing by the rules, rules that are intended to facilitate accumulation. Successful people are expected to accumulate wealth. Indeed that is our definition of success—we are taught to admire such people, and to aspire to be like them.

In pre-monetary societies, fairness meant behaving altruistically—sharing, being generous and serving the other people in your community rather than taking advantage of them. Because the groups were small, it was obvious to everyone when an individual failed to share and do their part, and such individuals faced censure from their fellows.

If they had kept score you would see that, over time, the rest of the community came to be more and more indebted to skilled people. To our modern eyes, it might seem like the less skilled were taking advantage of the more highly skilled, but they didn't see it that way. Indeed it was frowned upon for successful people to put on airs in such cultures, or to use their skills to accumulate wealth. They considered it their responsibility to support their community. It was seen as just what human beings do, to the extent of their abilities. And everyone expected that their needs would be seen to by their community, to the extent that was possible. The result of all this was strongly beneficial to the community as a whole, including those we might see as being taken advantage of.

If that sounds like communism to you —from each according to their ability and to each according to their needs—you're right. That is exactly what it was, and a good thing, too.

Occasionally, in our lengthy pre-historic past, the idea of money (or at least the concept of credit) was adopted by various cultures. It caught on pretty quickly because it could be used for all the "advantages" we've been discussing here. In some cases there were also built in mechanisms for redistributing wealth—things like potlatches, funeral feasts and so forth, so that inequality didn't grow destructively, and runaway growth didn't have its inevitable environmental effects.

In other cases where inequality was allowed to accumulated across generations, the mass of people soon caught on and rebelled, reverting to more equitable ways of organizing things. In still other cases, societal collapse resulted. And finally, in cases where neither of those things happened, you ended up with the societies that eventually developed into to our modern capitalist civilization. Sadly, by the time those who were on the losing end of such arrangements realized what was going on, it was too late—those at the top of the organization were firmly in control, and not interested in changes that would impinge negatively on them. We were stuck in the sort of societies we currently have. Which brings us to the subject of hierarchies, which I will get to in my next post.

What I am intending to suggest here is that there are ways of supplying the needs of a society without causing inequality to grow. And without needing the economy to grow endlessly beyond the capacity of the planet to support. The sort of examples I've mentioned here are only a very few of the ways this might be done and I believe we may yet come up with new ideas that work even better.

In closing, I should probably (for the sake of completeness, but with little hope of achieving it) make a few comments on markets and property.

Markets

At the most basic level, markets exist to place a value on goods and services. But never forget—the value of goods only needs to be determined because we are keeping score, and using money to do it. In any case, the supposed magic of the "free market" is largely theoretical. At best, it can only work when all the players involved have roughly equal power. In capitalism, the capitalists have considerably more power than workers and consumers, and love markets because they are open to manipulation and control. Being able to game the market actually creates many of the problems inherent to capitalism.

Property and Ownership

The concept of private property is central to enabling the accumulation of wealth. The strong take what they wish, have the power to hold onto it, and use it to generate further wealth. Civilization consists largely of having laws to protect the private property of the rich and a police force to enforce them.

In such a system, owners have the right to abuse their property and deplete its resources, with consequences that are currently beginning to come due the world over (climate change, habitat destruction, resource depletion). In a sustainable society, land and resources would be the property of the community as a whole and that ownership would be about stewardship not exploitation.

We should also be clear that there is a distinction here between private and personal property. Personal property consists of items that you use in daily life (like your toothbrush, and your shoes and clothes). A community might elect to extend personal property rights to tools, homes and garden plots. But if you take property rights much further, you end up with individuals having the right to exploit land and resources to their own benefit and the detriment of the community and planet as a whole. Which is exactly what we want to avoid.


During the last few months while I've been dragging my feet about writing for this blog, I've been reading a number of very interesting books, which bear upon what we are discussing. Here is a list of those books, along with a few that I've read previously, but that also have been a help.

Debt, The First 5000 Years, by David Graeber

Hierarchy in the Forest: the evolution of egalitarian behavior, by Christopher Boehm

The Art of Not Being Governed, by James C. Scott

Against the Grain, a deep history of the earliest states, by James C. Scott

Living at the Edges of Capitalism: Adventures in Exile and Mutual Aid, by Andrej Grubacic

The Dawn of Everything, by David Graeber and David Wengrow



Links to the rest of this series of posts: Collapse, you say?

Tuesday, 3 March 2020

Responding to Collapse, Part 16: Shortages of Money, Part 1

A few posts back I said that shortages of electrical power, diesel fuel and money will be at the heart of the troubles that lie ahead for small remote communities as collapse progresses. I am interested in that sort of community because that is where I am recommending that you take refuge in order to ride out collapse (and where I have already taken refuge). I've covered electrical power in parts 10 to 14 of this series and diesel fuel in part 15, so that leaves money for this post and the next one.

We'll be looking at shortages of money from two angles here. First, in this post, shortages that occur when you have money on deposit at the bank, or credit prearranged with the bank, but can't access it due to problems with the banking system. Second, in the next post, shortages that occur when you have trouble earning enough money to live on because of problems with the economy.

The song says, "money makes the world go round". You could certainly be forgiven for believing that, especially given the increased commodification of everything that has been going on, and the growth of the financial sector of the economy in the last few decades. I don't agree, though. Drawing from the writings of Dr. Tim Morgan on "surplus energy economics", I would say that it is energy that makes the world, or at least the economy, go round.

We'll get back to the role of energy in the economy in my next post, but first let's look at money itself. Money is really just a system of tokens we use as a medium of exchange, a unit of account, and a store of value.

Conventional economists tell stories about how before money was invented, people had to barter for what they needed but couldn't produce for themselves, and this was very inconvenient. In fact, as an anthropologist would tell you, barter was used only on those rare occasions when they were trading with strangers, and often with the intent of gaining a (possibly unfair) advantage. They were strangers, after all.

Most people usually dealt only with people they knew and didn't want to cheat. In small groups (less that Dunbar's number) there was no need of money since people just did what was needed, didn't attempt to keep precise accounts it, and accumulated little of value to store. This was primitive communism which worked on the principle of "from each according to their ability and to each according to their needs."

As people began to live in larger groups, it proved useful to have some way of keeping track of transactions with people outside one's immediate group. I'm not going to go into the historical details here (read Graeber's book if you are interested), but eventually we arrived at the system we use now.

Today money is created when a bank loans it out as debt. The main thing about money created as debt is that it can increase flexibly as the economy grows, where money based on precious metals is limited by the scarcity of those metals. In order to make a profit, which is after all the reason for their existence, banks insist that those loans have to be paid back with interest. This means that the economy must continually grow in order to cover that interest. As long as the economy is growing, this system works quite well. Indeed that is why we adopted it, to accommodate the growth stimulated by fossil fuel energy.

Only a tiny fraction of money ever exists as coinage or bank notes—mostly it just consists of entries in the banks' accounting software. Coinage confuses the issue of what money really is, since coins at least appear to be made of precious metals. Many people believe that money based on precious metals (gold, silver) has some real value, because of their rarity and the difficult of mining them. They call our modern debt based money “fiat currency” because its value is based solely on your confidence in it. I disagree. Take gold as an example—it has some limited industrial use because of its low electrical resistance and high corrosion resistance, but its current high market value is based almost entirely on what people think it is worth. In fact all money is an abstraction and its value is based only on what value people agree to give it.

Indeed the financial sector of the economy is largely based on trading in money itself as well as stocks, bonds, and derivatives. Much of the so called wealth in the world is based on these things, and their value is almost entirely based on public confidence in them. If the confidence evaporates, so does the wealth.

I would define wealth as an enforceable claim of ownership on things with real value, or an enforceable claim on future productivity, yours or someone else's. The value of money in the bank or investments, is based on a claim on future productivity, and if that productivity decreases, so does the value of your claim on it. And, of course, if your claims become un-enforceable, as they might if the financial sector or society itself experience disruption, your "wealth" is worth nothing.

In the last few decades the switch over from primitive communism to modern neoliberal capitalism has been just about completed. The idea of an "immediate group" has largely disappeared, much to our loss, and money mediates almost all relationships, even to some extent within nuclear families. This means that we are very much dependent on the systems which provide us with money, and via that money, the necessities of life.

Today most of us access the cash we have on deposit at a bank via an automatic teller machine (ATM) or less commonly via a human teller at the local bricks and mortar office of our bank. And more and more we use debit cards to eliminate actual cash altogether, accessing our bank deposits directly at point of sale terminals. Many of us also have credit cards allowing us to access credit up to a prearranged limit at ATMs or point of sale terminals. Some of us, who are undertaking rennovation projects or operate small businesses for instance, have arranged lines of credit at the bank, at much lower interest rates than credit cards. This form of credit is usually accessed via cheques or online transfers.

But having cash on deposit or prearranged credit is no good if you can't access it. Ready access to money relies on infrastructure that can fail quite easily. A local grid failure or damage to communications cables can knock out ATMs, point of sale terminals and the banks themselves—you may have noticed that, when you are dealing directly with a human teller, they are making entries in a computer while dispensing or receiving cash. Cash itself has to be delivered regularly to both ATMs and banks and shortages of diesel fuel or storms closing the highways can stop those deliveries.

Financial crashes, recessions or depressions can cause banks to fail and take your money down a financial black hole with them. And during such crises the banks who don't fail get very cautious in their dealings with each other and the public. This is like throwing sand in the gears of the economy, and makes the situation worse. In such an event, you can except that your access to credit will dry up and that even your access to cash on deposit will be limited, since the banks will be concerned about nervous people deciding to withdraw all their money, in what is known as a "run on the bank". The banks, of course, don't have enough cash on hand to cover all the deposits that people have made, and would likely limit you to taking out only a few hundred dollar a week, at most.

The simplest preparation for these sort of problems is having a chunk of cash on hand, enough to see you through a few days or weeks at the worst. And having a stock of food and other essentials on hand so you don't need so much money to spend in times when the banking system isn't working.

A lot of people seem to think that a long term failure of the financial sector would be the end of the world, or at least of the economy, and believe that it is the form that collapse will take. But remember an economy is just a system in which the things people need are made and exchanged. Among small numbers of people who know each other (or can quickly come to know each other), and certainly in emergencies, it is quite possible for such activity to continue without anyone keeping track of it. The thing, of course, is to have close to hand the resources from which to make what is needed. In large population centres, once shipments stop, this quickly becomes difficult. In small agricultural communities, it need not be so much of a problem.

In communities of more than a couple of hundred people, it would be useful to print and issue a local currency and set up accounting systems separate from the no longer functioning banks. The idea that we can't get by without banks irks me—they currently have a monopoly on the services they provide and on which we depend—and they make a generous profit in that business. If they can no longer do their job, then we should feel free to replace them as needed.

As my regular readers know, I believe that collapse is actually something that happens quite slowly, has been going on for the last 50 years or so, and will be continuing for years or probably decades to come. But, when it comes to money, I can see why many people seem to have their hearts set on a fast collapse. Such a collapse would be much harder, of course, but at least your creditors, landlords, etc. would be collapsing with you and wouldn't be able to come after you for what you owe them. Leaving you free to concentrate on the business of survival.

In a slow collapse there will be a period of time (already started, actually) when the banks and landlords still want their pound of flesh, but many people no longer have jobs, or good enough jobs, to pay them.

That will be the subject of my next post.

As I have been writing this post, the corona virus, COVID-19, has been spreading over the world. I've done a fair bit of reading on it recently, and I am getting disgusted with the amount of fear, uncertainty and doubt (FUD) that is being spread around by people who stand to gain by attracting more visitors to their websites. This is uncertainly not conducive to an intelligent response.

This a new disease and there is much we do not yet know about it, much that we will only know after the dust has settled. I think this sort of uncertainty is going to be characteristic of many of the challenges we will face as collapse deepens. My hope is that this blog will be conducive to a calm and constructive response to such challenges. Here are a few links that I hope will help when it comes to responding to COVID-19:

That last link is behind a paywall, so I'm including a link with advice to help you get past paywalls in general.. Just part of my anarcho-communist approach to life.


Links to the rest of this series of posts, Preparing for (Responding to) Collapse:

Friday, 26 January 2018

The Bumpy Road Down, Part 4: Trends in Collapse

Bamboo in Winter

This time I'm going to look at some of the changes that will happen along the bumpy road down and the forces and trends that will lead to them. If you followed what I was saying in my last post, you'll have realized that the bumpy road will be a matter of repeatedly getting slapped down as a result of going into overshoot—exceeding our limits, crashing, then recovering, only to get slapped again as we go into overshoot yet again.

Along the way, where people have a choice, they will choose to do a range of different things (some beneficial, others not so much), according to their circumstances and inclinations. Inertia is also an important factor—people resist change. And politicians are adept at "kicking the can down the road"—patching together the current system to keep it working for little while longer and letting the guy who gets elected next worry about the consequences.

Because the world will become a smaller place for most of us, we'll feel less influence from other areas and in turn have less influence over them. There will be a lot more "dissensus"—people doing their own thing and letting other people do theirs. I expect this will lead to quite a variety of approaches, some that fail and some that do work to some extent. In the short run, of course, "working" means recovering from whatever disaster we are currently trying to cope with. But in the long run, the real challenge is learning to live within our limits and accept "just enough" rather than always striving for more. Trying a lot of different approaches to this will make it more likely that we find some that are successful.

Anyways—changes, forces and trends...and how they will work on the bumpy road down.

I've included the stepped or "oscillating" decline diagram from my last post here to make it easier to visualize what I'm talking about.

Energy Decline

Because I'm a "Peak Oil guy" and because energy is at the heart of the financial problems we're facing, I'll talk about energy first. As I said in a recent post:

"Despite all the optimistic talk about renewable energy, we are still dependent on fossil fuels for the great majority of our energy needs, and those needs are largely ones that cannot be met by anything other than fossil fuels, especially oil. While it is true that fossil fuels are far from running out, the amount of surplus energy they deliver (the EROEI—energy returned on energy invested) has declined to the point where it no longer supports robust economic growth. Indeed, since the 1990s, real economic growth has largely stopped. What limited growth we are seeing is based on debt, rather than an abundance of surplus energy."

It is my analysis that there is zero chance of implementing any alternative to fossil fuels remotely capable of sustaining "business as usual" in the remaining few years before a major economic crash happens and changes everything. So the first trend I'll point to is a continued reliance on fossil fuels. Fuels of ever decreasing EROEI, which will increase the stress on the global economy and continue contributing to climate change and ocean acidification.

Those who are mainly concerned about the environmental effects of continuing to burn fossil fuels would have us stop using those fuels, whatever the cost. But it is clear to me that the cost of such a move would be a global economic depression different only in the details from the one I've been predicting. Lack of energy, excess of debt, environmental disaster—take your pick....

It has been interesting to watch the governments of Canada and the US take two different approaches to this over the last couple of years.

The American approach has been based on denial. Denial of climate change on the one hand, and denial of the fossil fuel depletion situation on the other. "Drill baby, drill!" is expected to solve the energy problem without causing an environmental problem. I don't believe that either expectation will be borne out over the next few years.

Our Canadian government under Prime Minister Justin Trudeau has made quite a bit of political hay by acknowledging the reality of climate change and championing the Paris Climate Agreement in the international arena. Here at home, though, it is clear that Trudeau understands the role of oil in our economy and he has been quick to quietly reassure the oil companies that they have nothing to fear, approving two major pipeline projects to keep oil flowing from Alberta to the Pacific coast and, eventually, to Chinese markets.

Yes, Ottawa has set a starting price of $10 a tonne on carbon dioxide emissions in 2018, increasing to $50 a tonne by 2022. This is to be implemented by provincial governments who have until the end of the year to submit their own carbon pricing plans before a national price is imposed on those that don't meet the federal standard. It will be interesting to see how this goes and if the federal government sticks to its plan. Canada is one of the most highly indebted nations in the world and I wouldn't be surprised if our economy was one of the first to falter.

At any rate, sometime in the next few years the economy is going to fall apart (point "c" in the diagram). As I've said, this may well be initiated by volatility in oil prices as the current oil surplus situation comes to an end. This will lead to financial chaos that soon spreads to the rest of the economy.

On the face of it this isn't too different from the traditional Peak Oil scenario—the collapse of industrial civilization caused by oil shortages and sharply rising oil prices. But as you might guess by now, this isn't exactly what I think will happen.

In fact, I think that we'll see an economic depression where the demand for oil drops more quickly than the natural decline rate of our oil supplies and the price falls even further than it did in 2014-15. We won't be using nearly so much oil as at present, so we will once again accumulate a surplus, and we'll even leave some reserves of oil in the ground, at least initially. This will help drive a recovery after the depression bottoms out (point "e" in the diagram). Please note that I am talking about the remaining relatively high EROEI conventional oil here. Unconventional sources just don't produce enough surplus energy to fuel a recovery.

But the demand for oil will still be a lot less than it is today and this will have a very negative effect on oil companies. Some governments will subsidize the oil industry even more than they have traditionally, just to keep to it going in the face of low prices. Other governments will outright nationalize their oil industries to ensure oil keeps getting pumped out of the ground, even if it isn't very profitable to do so. Bankruptcy of critical industries in general is going to be a problem during and after the crash. More on that in my next post.

During the upcoming crash and depression fossil fuel use may well decline enough to significantly reduce our releases of CO2 into the atmosphere—not enough perhaps to stop climate change, but enough to slow it down. As we continue down the bumpy road, though, our use of fossil fuels and the release of CO2 from burning them will taper off to essentially nothing, allowing the ecosphere to finally begin a slow recovery from the abuses of the industrial age.

The other trend involving fossil fuels, as we go further down the bumpy road, will be their declining availability as we gradually use them up. Eventual our energy consumption will be determined by the local availability of renewable energy that can be accessed using a relatively low level of technology. Things like biomass (mainly firewood), falling water, wind, passive solar, maybe even tidal and wave energy. Since these sources vary in quantity from one locality to another, the level of energy use will vary as well. Where these sources are intermittent, the users will simply have adapt to that intermittency.

No doubt some of my readers will be wondering why I don't think high tech renewables like solar cells and large wind turbines will save the day. The list of reasons is a long one—difficulty raising capital in a contracting economy, low EROEI, intermittency of supply and the difficulty (once fossil fuels are gone) of building, operating, maintaining and replacing such equipment when is wears out—to mention just a few.

Large scale storage of power to deal with intermittency will in the long run prove infeasible. Certainly batteries aren't going to do it. There are a few locations where pumped storage of water can be set up at a relatively low cost, but not enough to make a big difference. And on top of all that, I very much doubt that large electrical grids are feasible in the long run (and I spent half my life maintaining on one such grid).

The FIRE Industries

The next trend I can see is in the FIRE (financial, insurance and real estate) sector of the economy. During the growth phase of our economy over that last couple of centuries the FIRE industries embodied a wide range of organizational technologies that facilitated business, trade and growth. Unfortunately, because they were set up to support growth, they were unable to cope with the end of real growth late in the twentieth century. They have supported debt based growth for the last couple of decades as the only alternative that they could deal with. This led to the unprecedented amount of debt that we see in the world today. Much of this debt is quite risky and will likely lead to a wave of bankruptcies and defaults—the very crash I've been talking about.

The FIRE industries will be at the heart of that crash and will suffer horribly. Many, perhaps the majority, of the companies in that sector won't survive. In today's world they wield a great deal of political power. During the global financial crisis (GFC) in 2007-8 that power was enough to see them through largely unscathed. This is unlikely to be the case in the upcoming crash, creating a desperate need for their services and an opportunity to fill that need which will be another factor in the recovery after the crash bottoms out. But of course there is more than one way it can be done.

In the 3rd, 4th, 5th, 6th and 7th posts in my " Collapse Step by Step" series, I dealt with the political realities of our modern world, which limit what can be done by democratic governments. I identified a political spectrum defined by those limits. At the left end of this spectrum we have Social Democratic societies, which still practice capitalism, but where those in power are concerned with the welfare of everyone within the society. At the right end we have Right Wing Capitalist societies where the ruling elite is concerned only with accumulating more wealth and power for itself.

Since the FIRE industries are crucial to the accumulation and distribution of wealth in our societies, the way they are rebuilt following the crash will be largely determined by the political goals of those doing the rebuilding.

At the left end of the spectrum there is much can be done to regulate the FIRE industries and stop their excesses from leading immediately to further crises.

At the right end of the political spectrum the elite is so closely tied to the FIRE industries and so little concerned with the welfare of the general populace, that those industries will likely be rebuilt on a plan very similar to their current organization. A policy of "exterminism" is likely to be followed, where prosperity for the elite and an ever shrinking middle class is seen as the only goal and the poor are a burden to be abandoned or outright exterminated.(Thanks for Peter Frase, author of Four Futures—Life After Captialism for the term "exterminism".)

In the case of either of these extremes, or anywhere along the spectrum between them, there are some common things I can see happening.

The whole FIRE sector depends on trust. In the last few decades (since the 1970s) we have switched from currencies based on precious metals to "fiat money" which is based on nothing but trust in the governments issuing it. This was done to accommodate growth fueled by abundant surplus energy and then to facilitate issuing ever more debt as the surplus energy supply declined. I don't advocate going back to precious metals—what we need is a monetary system that can accommodate degrowth, of which a great deal lies in our future. Unfortunately we don't yet know what such a system might look like.

It is clear, though, that the coming crash is going to shake our trust in the FIRE industries to its very roots. Since central banks will have been central to the monetary problems leading to the crash, they may well be set up as scapegoats for that crash and their relative lack of success in coping with it. People will be very suspicious after watching the FIRE industries fall apart during the crash and their lack of trust will force those industries to take some different approaches.

I think governments will take over the functions of central banks and stop charging themselves interest on the money they print. Yes, I know that printing money has often led to runaway inflation, but the conditions during the crash and its aftermath will be so profoundly deflationary that inflation will not likely be a problem.

The creation of debt will be viewed much less favourably and credit will be much harder to get. And of course this will make the crash and following depression that much worse. In response to this many areas will create local banks and currencies to provide the services and credit that local businesses need to get moving again.

During the last couple of decades there has been a move to loosen regulations in the FIRE industries, to let single large entities become involved in investment banking, business and personal banking, insurance and real estate. Most such entities began as experts in one of those areas, but one has to question their expertise in the new areas they moved into. In any case they became "too big to fail" and their failure threatened the stability the whole FIRE sector. Following the GFC there was only minor tightening of regulations to discourage this sort of thing. After the upcoming crash I suspect many governments, especially toward the left end of the political spectrum, will institute a major re-regulation of the FIRE industries and a splitting up of the few "too big to fail" companies which didn't actually fail.

It is all very well to talk about business and even governments failing when their debt load becomes too great. But there is also a lot of personal debt that is, at this point, unlikely ever to get paid back. What does it mean, in this context, for a person to fail? What I carry as debt is an asset for someone else—probably the share holders of a bank. They are understandably reluctant to watch their assets evaporate, and I have to admit that there is a moral hazard involved in just letting people walk away from their debts. That feeling was so strong in the past that those who couldn't pay their debts ended up in debtors' prisons. Such punishment was eventually seen as futile and the practice was abandoned and personal bankruptcies were allowed.

One suspects that in the depression following the coming crash it will be necessary to declare a jubilee, forgiving large classes of personal debt. What might become of all the suddenly destitute people depends on where their country lies on the political spectrum. I wouldn't rule out debtors prisons or work camps, the sort of modern slavery that is already gaining a foothold in the prison system of the United States.

If we were willing to give up growth as the sole purpose of our economic system, there are many changes that could be made to the FIRE industries that would allow them to provide the services needed by businesses and individuals without stimulating the unchecked growth that leads to collapse. I think we are unlikely to see this happen after the upcoming crash—we will be desperate for recovery and that will still mean growth at destructive levels.

I think the crash following that recovery will involve the food supply and still unchecked population growth and sadly a lot of people won't make it through (more on this in my next post). Following that, it's even possible that in some areas people may reach the conclusion that growth is the problem and quit sticking their heads up to get slapped down again. They'll have to find a more sustainable way to live, but with it will come a less bumpy road forward.

Authoritarianism

In the aftermath of the next crash, I think we'll see an increase in authoritarianism in an attempt to optimize the systems that failed during the crash—to make them work again and work more effectively. Free market laissez faire economics will be seen to have failed by many people. Others will hang tight, claiming that if they just keep doing yet again the same thing that failed before, it will finally work.

As is always the case with this sort of optimization, it will create a less resilient system, much more susceptible to subsequent crashes. And after those crashes government will be reduced to such a small scale affair that authoritarianism won't be so much of an issue.

Fortunately, beyond authoritarianism, there are some other trends that will lead to increased resilience and sustainability. We'll take a look at those in my next post.


Links to the rest of this series of posts:
Political Realities / Collapse Step by Step / The Bumpy Road Down