A Typical Reaction

Occasionally when people talk to me about my new life in and around the mud hut, their conclusions include one of the following statements: (1) You’re selfishly wasting your talent as an excellent and inspiring teacher. You should be teaching at the university, saving students, instead of preparing for economic collapse. (2) Don’t be silly. The United States cannot suffer economic collapse.
My responses go something like this:

(1) At most, I made a minor difference for a few students during a two-decade career. I could keep doing that but, in the near future, that approach would kill me because it requires living in a major metropolitan area. I’m not willing to die for that particular cause. (The problem with being a martyr is that you have to die for the cause.) (2) Have you failed to notice the economic world around us? We passed TEOTWAWKI when the suburban housing market collapsed. So we socialized Fannie Mae and Freddie Mac. Then we socialized the financial system and the automobile industry. Call is socialism for the rich, capitalism for the poor, to quote Paul Ehrlich and Anne Ehrlich in One with Ninevah. I’d guess we have a few years before there is no more fuel at the filling station, food at the grocery store, or water coming out the taps.
More often, the conversation goes something like the following. It typically includes a middle-aged, middle-class American (MAMCA) visiting with me, although my role often is subsumed by a student responding to his or her parents as they play the former role.
MAMCA: Nice place you have here. Thanks for the tour. Do you really think the economy could collapse?
Me: Of course. In fact, the collapse — which, by the way, I prefer to call a Renaissance — is fully under way. The U.S. industrial economy nearly came grinding to a halt five times (that I know about) during the last year. According to Dmitry Orlov, author of Reinventing Collapse, we’re in the second of five stages of collapse (we passed financial collapse, we’re in the midst of commercial collapse, and political, social, cultural collapse lie ahead — unlike Orlov, I’d say social and cultural collapse have already happened in many locations, and we’re poised on the brink of political collapse).
MAMCA: Well of course the Soviet Union collapsed. Everybody saw that coming. There is no way to sustain socialism, after all But I don’t see any way this country could suffer a collapse. How could that happen?
Me: First off, it’s already happening, one household at a time. It could visit your household any number of ways. We passed the world oil peak several years ago, and demand seriously outstripped supply last summer, when the price of crude oil topped $147/barrel. That led to the failure of the suburban housing market, the failure of several banks, and socialization of banks and General Motors. Unemployment is skyrocketing and the nation’s “safety nets” are full of holes. Could you get caught in the unemployment wave? Probably not. Could you find yourself under water on your mortgage? Probably not. But many people, many households, have already collapsed under the weight of those two problems. Can you afford gasoline at $5 per gallon? Sure. But a lot of companies, large and small, cannot afford expensive fuel for a sustained period of time. When those businesses go under, they take real people down with them. At some point, all the banks collapse because the banking system only works when the industrial economy is growing. And the economy simply cannot grow when oil is too expensive because expensive oil eats up GDP and causes hyperinflation. The typical approach with individuals, groups, or economies is the same: they grow or die.
MAMCA: Okay, but how do we get from expensive oil to economic collapse? How do we get to no water coming out the taps? I just don’t see how that can happen. For starters, we’ll develop alternative energy sources when needed.
Me: First off, bear in mind that an annual decline rate of only one-half of one percent led to $147 oil. The International Energy Agency, a group that previously never admitted oil would peak, projected a decline rate of nine percent from this year forward. They’ve been wrong so far — data indicate an annual decline rate of only three percent so far, and demand destruction in the form of the ongoing recession is staying ahead of the three-percent decline rate. But if the recession shows signs of recovering, the price of oil will rise again. Oil priced at $150 per barrel consumes one-quarter of the world’s GDP, leaving little slack in the system. Second, there are no “renewable energies” that scale to a few million people, much less a few billion. All energy sources are derivatives of oil, not alternatives: It takes a lot of oil to make a solar panel, or a wind turbine. And try putting those in your car or truck. The bumper stickers are right, after all: “Without trucks, America stops,” at least with respect to economic growth.
All that aside, would you continue to go to your job if you weren’t getting paid, or if the paycheck kept bouncing? How about if money wasn’t work a thing?
MAMCA: I suppose not, at least not indefinitely.
Me: Would you continue to work if your employer has no financial value? That is, if the company is worth nothing on the stock exchange?
MAMCA: Of course not. That would mean they couldn’t pay anybody. But I don’t see how that leads to no fuel, no food, and no water out the taps.
Me: All fuel suppliers in this country are private. We have not nationalized our petroleum companies (yet). So if those companies have no value, do you suppose the drivers are going to keep delivering the fuel to the filling station? Ditto for Safeway.
MAMCA: Okay, I’ll reluctantly agree that we could, eventually, have no fuel and no food. But no water out the taps?
Me: Who supplies your water?
MAMCA: I don’t know.
Me: It’s either a private company or, more likely, a municipality. The employees at the municipalities have to cash their checks, too. To do so, a bank has to issue the check and a bank has to cash it. Perhaps the more important question is, “Where does your water come from?”
MAMCA: The tap, of course.
Me: And if you believe water originates at the tap, you’ll defend to the death the system that allows water to come out the tap. But of course water doesn’t originate with the tap, it originates in the watershed. When people realize where the water actually comes from, perhaps they will defend to the death the system that supplies the water, meaning an ecosystem. But I doubt it.
MAMCA: What you’re suggesting is that protecting the environment is more important than maintaining economic growth. But don’t we need economic growth to have the money to protect the environment?
Me: I don’t think we’ve ever made a serious attempt to protect the environment in this country. We occasionally take small steps to conserve specific areas after we ensure economic growth. But economic growth is the underlying root of environmental destruction. When we demand economic growth first, we postpone environmental protection until later. And it’s getting very, very late.
MAMCA: What do you mean by that?
Me: According to recent projections from large climate-forecasting groups, we’re very close to a tipping point, if we haven’t passed one already. Global climate change is accelerating as a result of economic growth. If we don’t halt or reverse global climate change, we’re doomed to extinction at our own hand.
MAMCA: But we can’t simply give up economic growth to save the planet, can we?
Me: No, apparently we’re unwilling to take that step, sane as it seems. We’d rather reduce the planet to a lifeless pile of rubble than slow economic growth.
MAMCA: Surely we can have both economic growth and protection of the environment.
Me: I’ve never been shown how that’s possible. Economic growth destroys habitats and species. Ultimately, it will destroy habitat for our own species, perhaps in as little as a single generation. We should welcome the ongoing Renaissance.
MAMCA: But no economic growth? You’re committing my children to a future of poverty.
Me: No, you already did that. In fact, our entire generation of Boomers did that when we abandoned the goal of living close to the land and close to our neighbors for the sake of economic growth. When we were offered a choice between the good life and “daylight in America,” we chose Ronald Reagan and the notion that greed is good. As a result, we burned through the planetary endowment of fossil fuels at a record-setting clip, hence polluting our waters and skies while ensuring your children are addicted to fossil fuels, economic growth, and technology. But if they’re like most 20-year-olds, they have no relationship with the living planet beyond the Discover channel and their Facebook friends.
MAMCA: An economic collapse sounds horrifying. People will die. Many of those people had nothing to do with this mess.
Me: As has always been the case.
MAMCA: What do you mean?
Me: The industrial economy is basis of American Empire. Imperialism kills people every day, and most of them had nothing to do with this mess.
MAMCA: I was talking about Americans.
Me: So was I.
MAMCA: But many Americans will be caught up in the collapse. Most people in this country do not know how to live if there’s no water coming out the taps.
Me: No, of course not. We’ve overshot our resources, and a population crash is quite likely.
MAMCA: When faced with hard times, I’m certain Americans will change their behavior. The economy has always recovered before.
Me: On the back of cheap energy. But those days are behind us. We face an event unprecedented in the history of the planet. We can enjoy an economic collapse and the associated Renaissance or we can suffer ecological collapse. The Renaissance will cause population reduction, but not nearly to the extent of the latter. Some leadership on this issue would be nice, although it’s clearly too late to save western civilization. Had we started on this project thirty years ago, we might be able to save some elements of civilization and avoid a large-scale die-off of civilized humans. But at this point, four years post-peak, I don’t see how we can mitigate collapse at the scale of a few million people, much less thirty million Americans or nearly seven billion planetary citizens. The famous Hirsch report concluded we’d have to start twenty years before peak to have a chance at saving civilization. And, even at that, we’d have to work at it. The federal government and the media haven’t even acknowledged the issue yet.
MAMCA: Okay, so when does collapse hit?
Me: As I already indicated, it’s already hit many people and many households. When does it hit you? That depends how wealthy you are. More importantly, it depends how willing you are to live in the world. I spent my life in the so-called ivory tower of academia. As you’ve seen, I’ve developed new skills to mitigate for a totally new set of circumstances in the years ahead. If I can do this, I’m pretty sure most people can, too.
MAMCA: I don’t have enough money to do this on my own.
Me: Neither did I. My wife and I were fortunate to have like-minded friends who generously offered their property as a starting point. We still are fortunate. Very fortunate, as it turns out. But we can all do something to prepare, especially us middle-aged, middle-class baby boomers.

Comments 12

  • Dear Guy —
    The system is collapsing under its own weight. But there is more to be said. Resource conflicts between nations and perhaps within nations are likely moving forward. Michael Klare has written on this.
    Imagine Chinese military hackers (or Russians or others) attacking our power grid electronically. Or our communications. The power grid is not only vulnerable to a loss of energy to combust to generate power, but the electrical and electronic control by the grid operators is very vulnerable.
    The grid goes down and so do our water pumps, our fuel pumps, our elevators in high rise buildings, our refrigeration, our lighting, our computerized accounting, our communications, our computers and their rechargable batteries. Our electric doors and electric faucets in commercial buildings will fail to operate. Our cinemas will become useless and moviegoers will not be able to see how American moviegoers seeing films like “Inglorious Basterds” cheer the illegal massacre of prisoners of war, the mayhem and murder of persons fighting under another flag, and the glorification of violence itself.
    There is no doubt that a military confrontation with foreign powers in a struggle for national survival will be an all-out war against the US civilian population as well.
    Cruise missiles from foreign submarines could knock out power grids as well.
    When the feces hit the blower, the bits will get blown far and wide.
    It is very likely that when world contraction proceeds, the collapse will be more than just an artifact of economic/ecological gravity, but of avarice as well.
    Stan Moore

  • I am sure gonna miss Paula : (

  • America as Las Vegas Casino
    J.H. Kunstler nailed it again today in his CF Nation essay on the false euphoria of “recovery” now gripping the nation and its financial gurus and “experts”.
    To put it another way, I would compare the American economy to a Las Vegas casino with “players” going to the casino operator and asking for chips. The goal is to get rich and the means is to borrow chips to play the games until one strikes it rich. No one ever anticipates going broke by this methodology, much less the casino itself.
    But eventually the casino tells the player: “no more chips for you”, pay up. Eventually the casino itself must pay its own debts.
    America’s economy now is largely a giant casino with little manufacturing, little of value produced, and the financial markets are buying and selling packages of debt on an enormous scale. Much of the debt itself is illegitimate and of dubious quality, being based on hyperinflated valuations of the underlying assets and “bubble” economics. Bubbles are full of nothing, and so are hundreds of billions and even trillions of “dollars” worth of debt instruments still lingering in the world’s financial markets. All the printing of paper and ignoring the underlying insolvency does not change the basic fact that we are a nation of debt-ridden casino gamblers hoping to strike it rich and living already as if we have struck the jackpot.
    But reality will intervene as it must. Much of our debt is financed by foreign governments which have benefited from the interplay, but which now see their own collapse tied in with the status quo. At some point, those financing our debt will be faced to deal with their own reality, which is that they must cut their losses and try to maintain productive activity without relying on income from insolvent debtors.
    It would be very interesting to eavesdrop on the behind-the-scenes conversations between US government officials and Chinese officials, and others. The threats and recriminations that fly back and forth out of sight would probably frighten us to hell if we were privy to them.
    The system is unsustainable, broken, and corrupt. It will be played like a bad poker hand until all the cards are dealt, and then the game will be over. The masses of humanity will lose and have already lost, even if they don’t know it. The leaders have dealt away the aces provided for us for free by our planet, and mankind cannot go on overconsuming with population levels and consumption at current rates much longer. But things will get worse as global warming (a wholy predictable byproduct of current and past overconsumption) kicks in full force.
    It is a perfect storm brewing and Bernanke is telling us that the sun is coming out. I wonder what Obama is going to tell his daughters, because he knows what to tell them…
    Stan Moore

  • Memo to Stan and all other California residents:
    Since you live in the Yuppie Scum capital of the world,I’d be very interested in your personal observations as a way to quantify and judge the shape and degree of the collapse.You live in an excellent,living,social laboratory.You can see the change in the mass psychology from the very top to what we have now.Please elucidate.
    Thank you.

  • That goes for you also Wendy.

  • Frank,
    California is in just as much denial as elsewhere. The basic plan as far as I can tell is to ride out unemployment until “recovery” falls into our laps like a cloud wafted on a zephyr. This is coming from those collecting unemployment I met on the beach at a free concert last week. After that there are free showers and a cool breeze at the beach for the “no longer unemployed” who still don’t have a job. As much as collapse will suck (even for those who are prepared) I think it is entirely necessary for how can new shoots grow in the shadow of a skyscraper or take root in concrete? Space must be made for a new lifestyle or we will all die with this kamikaze way of living as it snuffs itself out.

  • I have to agree with stan about the populations increasing divorce from reality when he brings up “Inglorious Bastards”. My father fought in europe and wound up as a pow in WW2. The logic and results of several US soldiers running around killing the enemy in this case gestapo and SS would only result in the roundup of french civilians by the hundreds who would have been shot in retribution. The ability of large numbers of the general population to process complex ideas,know history and act to forestall future problems has been damaged beyond repair.

  • regarding “Inglorious Basterds” — obviously the movie itself was not historic, as it depicted the killing of Hitler himself and his entourage at the cinema, which did not occur. The atrocities themselves were also pure theater; particularly the scalping of German soldiers in the style of the Indian Wars of the Old West.
    What I was commenting on in particular was not the movie itself and the theatrics, but the response of the audience in the theater in Rohnert Park, CA. People in the audience cheered the beating to death of a prisoner by the “Bear Jew” with a baseball bat, for instance. The prisoner was in custody and control of the US Army, and was murdered while the audience cheered. This demonization of German soldiers in a WWII setting is startlingly the same as the torture and killing of prisoners at Abu Graib, Guantanomo, and Bagram AFB. The American public in general has been extremely tolerant and often approving of murder against the “enemy”, which is illegal, immoral, and against the very “values” that the US military claims to be defending.
    The reaction of the movie audience is what scared me and shows how propaganda can manipulate evil and reduce our hostility to evil.
    Stan Moore

  • Remember “the audacity of hope?
    Remember “we can end the war, yes we can!”?
    Remember “change you can believe in”?
    Now that Obama won the election, it is the electorate who is audaciously clinging to hope that Obama will remember his own slogans.
    Alas, it was all bamboozlement from Day One, as I pointed out all along during the recent presidential campaign. Obama created wiggle room for himself within his rhetoric and his followers saw what they wanted to see and disregarded the obvious evidences to the contrary.
    And so they will continue to hope and hope and hope…
    Eventually, the masses may awaken and judge Obama on the content of his character rather than on the color of his skin, and when they do… they may feel … taken advantage of by an inglorious b…….
    Stan Moore

  • Stan:
    The audience was reacting normally.The human is a natural barbarian.
    They are no differnt than the human of 20,000 years ago.Civilization is highly artifical and unnatural.Concepts such as good and evil are illogical and irrelevant.The human has not changed and cannot change.The thin veneer of “civilization” is an illusion–a falsehood.
    You can no more “civilize” a human than you can a racoon or a rat.
    The only substantive thing that differentiates a human from any other species is the human brain.But very few people know how to use their brains–that is to think.Without the ability to think,and when I say think, I mean independent thought,the brain is a liability,not an asset.Very few people ever entertain an independent thought.So the vast majority are mental and psychological slaves to the powers that be–mainly the priests and the rulers.
    You will only get a Pavlovian response from the mass.

  • Nice. I’ll have to keep this one as reference material for my conversations ;)
    By the way, your “Sign in” link for comments is broken…
    — Chad

  • I can’t agree with you on everything you say, but I wouldn’t be so foolish as to label you selfish or foolish.
    Given my druthers, I’d probably be setting up a nice goat farm somewhere in some backwater of the Pacific Northwest right about now–with or without the threat of collapse or anything else. Mainly because I think there’s too much BS in the system and it just irks me to no end. It really crimps my otherwise positive Ch’i. Not a day goes by that I don’t wonder why more people don’t try harder to do and value the things that matter.
    But the solution for the whole mess is the same as it was months ago: entropy. It has to happen for any sort of renewal to take place. And frankly, too many idiots have risen to places of esteem on the waves of graft and corruption…not to mention all the idiots who let it happen in the first place.
    Not to worry, though. It is the way it is, and will end they way it has to end. The positive news, is that good will crop up afterward (at least for a while, til the next round). I may not survive to see it, but take comfort in the notion that this is the way things work.
    In the meantime, you muddle through your way, and I muddle through mine. :) No worries.