Titanic Lifeboat Academy has featured online, and locally sponsored, many programs for building self-reliance and resilience: Growing food, investing locally, TimeBanking, maintaining personal/local control over resources, promoting nonprofits at an annual fair, promoting emergency preparedness, etc.
Because dependency is the opposite of strength, and far-away centers of control increase dependency, TLA has encouraged independence from non-local systems and local cooperation and community.
In The Collapse of Complex Societies, Joseph Tainter definitively described how increasing system complexity concurrently increases brittleness. Some examples of complexity breeding brittleness:
As complexity increases, systems become more dependent on other systems. (Example: Anything electrical is only as reliable as the grid where you live, unless you have your own power system.)
As complexity increases, systems become more opaque to anyone not trained in that specific system. (Fewer people are qualified to maintain or to fix them; maintenance and repair become more expensive, and breakdown will affect an increasing number of people and other systems.)
As complexity increases, systems expand exponentially – companies built of medium-sized companies built of smaller companies layering down to branch offices in small cities, rendering them extremely remote from the individual. Remoteness, in turn, increases the perceived need for individual compliance with the imposed, capital-driven rules that keep the collasal system functioning.
Meanwhile, if the system itself – or any integral component - should generate an error, the ramifications can be enormous, as in cyber strikes:
“CrowdStrike had more than 24,000 customers, including nearly 60% of Fortune 500 companies and more than half of the Fortune 1000.” [Wikipedia]
As a result, roughly 8.5 million systems crashed and were unable to properly restart in what has been called the largest outage in the history of information technology and "historic in scale". [Wikipedia]
So, when something goes wrong, it goes wrong for tens of thousands of customers. Then, it goes wrong for their tens of thousands of customers, resulting in millions as it cascades all the way down to Main Street.
Mergers and acquisitions, leveraged buyouts, hostile takeovers took off between 1980 and 2000, then exploded from 2000 to 2020. This amalgamation of large companies into ginormous companies has created the richest rich, a disappearing middle class, and a very brittle society.
Not everyone supports this consolidation of power and control affecting nearly every individual, though no one in the Western world at least, has been asked. Economist and former government official Paul Craig Roberts:
It has been clear to me from the beginning that the digital revolution was a massive catastrophe in the making.
The digital revolution is a catastrophe across the board. It not only gives government ability to impose tyranny beyond George Orwells’ imagination, it subjects all accumulated knowledge to wipe-out by an electromagnetic pulse, and it causes shutdown of worldwide economic activity because of a bug in cybersecurity software.
...In my opinion the digital revolution is the work of people with insufficient vision and ability to comprehend the obvious fragilities of the unreliable and easily compromised digital system on which we find ourselves dependent.
There is no such thing as cybersecurity….The once proud American people have been forced to subject ourselves to being spied on by a tyrannical government, to have zero privacy, to be susceptible to theft of our identity, our bank accounts, our investment accounts, to be susceptible to the FBI implanting child porn on our computers or whatever evidence against us that they want to implant.
The people who brought us the digital revolution and are now bringing us artificial intelligence are….unable to comprehend the unintentional consequences of what they are doing.
Perhaps most vitally, as complexity increases, systems require increasing amounts of energy. Think what happens when the grid goes down for a couple of days. What would happen if it were down for a couple of weeks? Intermittently, every day?
Cryptocurrency mining surpasses energy consumption of entire countries – study
Extracting a dollar’s worth of cryptocurrency requires up to three times more energy than digging up a dollar’s worth of gold, according to a new international study.
Cryptocurrency mining may kill Earth faster than coal mining, study finds
Thanks to the massive amount of electricity needed to mine cryptocurrency, adopting bitcoin on a society-wide basis could raise global temperatures by two degrees Celsius in just 15 years, according to a new study.
Outside the Western world, nations are taking steps to shield themselves from such technological vulnerabilities:
Country turns to nuclear as crypto mining causes electricity shortage
Authorities in Kazakhstan are considering building a nuclear power plant following the rapid growth of cryptocurrency mining, which has seen the Central Asian country suffer from serious electricity shortages.
Russia could use manure for crypto mining – research
Recycling organic waste to generate electricity is a way to power the energy-intensive process, scientists say
Thanks to efforts toward self-reliance and self-sufficiency, countries in what is increasingly known as the “Majority World”, were not affected by the CrowdStrike debacle:
Tech self-reliance helps shield China from Windows outage - 'Blue Screen of Death' sparks global cybersecurity concerns
China was largely unaffected as the country's technology independence and self-sufficiency efforts have provided a protective shield.
Russia unaffected by global IT meltdown – ministryRussia unaffected by global IT meltdown – ministry
The crisis illustrates the importance of becoming self-sufficient in terms of critical software, the ministry has stressed.
What’s good for these countries is good for individuals and their communities. Someone who wrote and spoke for years on the need for personal and community self-reliance, resilience and self-sufficiency is Nicole Foss, formerly with The Automatic Earth.
We’ll close with excerpts from “Nicole Foss on Money and Financial Crises” at Fixing the System; the full post is available here and a real-world example from the Local Investor Owner Network, filmed by PeakMomentTV.
Excerpts from : Nicole Foss on Money and Financial Crises
Financial collapse
Credit is now of the order of 99% of the money supply, which means that 99% of the money supply is excess claims to underlying real wealth. We took a small amount of collateral, and we backed an enormous number of loans with it, so we now have a crisis of under-collateralisation. This means we are all playing a giant game of musical chairs, there is about one chair for every hundred people playing the game, and as long as we are all up and dancing to the music and enjoying ourselves, we don’t really notice how few chairs there actually are, and not all of us entirely understand the rules of the game we are playing either. But, when the music stops, the people best positioned to understand the rules of the game are going to grab a chair as quickly as they possibly can. The great collateral grab will be on, and everybody else’s excess claims to underlying real wealth will be rapidly and messily extinguished. This is deflation, by definition, and that is what we stand on the verge of today. So, the expansion phase lasts quite a long time, but the contraction phase can actually be quite rapid….
The great collateral grab
So the great collateral grab is underway, in places like Greece, where people are being told, or the government in particular is being told: “[S]ell us your ports, and your railways, a few islands, the Parthenon.” Greeks are going to be tenants in their own country at this rate, they are not going to actually own anything anymore, because the creditors are coming for the underlying real wealth. So this is happening throughout the European periphery at the moment, and that same dynamic is going to take hold in other places too….
Energy and Resources
I wanted to look briefly at energy and resources, because this is probably going to be hurdle number two. It depends where you are, because resources are not evenly distributed, so exactly what will be the limiting factors following on from finance is, to some extent, a matter of guesswork. But energy is going to be a very big limiting factor in an awful lot of places. Energy is simply critical. It is the capacity to do work. And if you look at the energy sources we’ve built our society on, the ones that allowed us to reach these enormous heights of complexity, they had a very high energy-profit ratio, and there was more and more, every year we produced more and more and more.
Production is now flat to falling from those high energy to profit ratio energy sources. The energy profit ratio matters enormously, because it is the ratio between how much energy you put in, and how much you get out as a result. So in the early days of the oil industry, you invested a unit of energy in energy production, you’d get 100 units of energy in return, now maybe 10 to 15 globally. But if you look at the things we are considering as future energy sources, they are about a factor of 10 lower, so maybe 1.5 to 1. That’s not a very high energy to profit ratio, to put it mildly. And if your energy profit ratio falls by a factor of 10, your gross production would have to rise by a factor of 10, just to keep you in the same place, in terms of access of a society to energy, but gross production is flat to falling. So when you have production falling, and the energy-profit ratio falling very steeply as well, that equals a very large energy crunch, so we are going to have an awful lot less energy in the future than we do now.
Now we are looking at all these unconventional sources, to seamlessly supply what the old oilfields have been supplying for the last several decades. To compare conventional and unconventional energy, think if you’re thirsty, you want another drink, conventional energy supplies are like going up to the bar, ordering another beer, and sitting there and drinking it in peace and comfort. Unconventional energy supplies are what you do when the bar is closed – you can’t get another pint of beer, but you’re still desperate and you still want another drink – desperate enough to suck the spilled beer out of the carpet. Even if the bar patrons were remarkably messy, and spilled an enormous amount of beer into that carpet, you’re not going to get a whole lot, you’re going to get a mouthful of dirt, the flow rate will be really low, and it’s going to be a thoroughly unsatisfying experience. It simply does not provide what the conventional supplies were capable of providing. This is not any kind of energy future, and in fact our ability to frack and drill horizontally, and all of these complex things, entirely rests on the supply of conventional oil that we have. We are using up the last of our conventional, high energy-profit ratio energy sources to build infrastructure for these unconventional sources that are never going to supply what we think they are going to supply. So this is another complete conversion of capital to waste.
Adapting to low energy
When we have less energy available, as we will, our society will have to simplify, because the energy-profit ratio determines the level of complexity that you can maintain. When we are working on lower energy-profit ratio energy sources, societies will have to simplify. But simplified societies don’t frack and they don’t horizontally drill, so we are not going to be able to do these things in the future anyway. What we need to do is be a lot cleverer, and look at how we might use what we have to create infrastructure that will be able to be maintained, that will still function in a much lower energy future. We need to think a lot more about how we might cope when energy supplies are a lot less plentiful than they are now. Right now we just throw cheap energy at every problem that we have. That’s not demonstrating that we’re clever. In the future we are going to have to prove whether in fact we are clever or not.
Planning horizons are going to change remarkably, over the next few years. There is an economists’ concept called the discount rate, that’s the rate at which we discount the future in comparison to the present. When people have all the major bases covered, they’ve got enough to eat and drink, they’re not cold, they’re not penniless, they start to think more about the long term – they have the luxury of the longer term view – if they’re not in a state of short term crisis. So at the moment, we think a little bit more about the future – we are not terribly good at thinking about the future as human beings, but at the moment when we have most bases covered, we are better at it than we usually are. But, when you move into the contraction phase, and you start to get into that short term crisis situation, the discount rate will go through the roof. You’ll be lucky to find people thinking much beyond next week, let alone next year, or longer term priorities.
However, if we can be proactive, and build supply cushions for the essentials, then we can preserve the luxury of the longer term view, because if we let ourselves get pitched into a state of short term crisis management, we don’t do our best thinking under those circumstances. We really need to keep ourselves in a cool head space where we are thinking constructively. To do that, we need to be proactive, to build those supply cushions, even if they are relatively small, they will make a big difference to our ability to maintain a cool head in the future. Because if we can do that, we keep people from defaulting into movements of anger and fear that do nothing but give political mandates to extremists.
Building community
We absolutely must build community. That’s thing number one. The most important thing you can do is to come together and work with other people, and build relationships of trust. It’s about pooling resources: time, skills, space, facilities, tools, enthusiasm, and money. Everyone has something to offer, and if you pull those things together, the whole will be greater than the sum of its parts, and this will allow people to face a future together, and this be much easier to face the future together than it would be if people were only focusing on individual actions.
Empowerment and engagement matter a lot. In an era of expansion we disempowered people, because we scaled everything up so enormously, we moved so far beyond human scale that people didn’t think what they did would make any difference, and they were working hard on the treadmill, and kept running faster and faster, so they disengaged. You have much less civic engagement today than we did several decades ago. But when we start working at a smaller scale again, because effective organisational scale will shrink so much, this will be much more like human scale, so our activities as individuals are going to make a significant difference, and we can expect a much greater degree of civic engagement under those circumstances. So this is where we need to start with the process of downloading responsibility, and looking at our individual actions and how they can affect our local reality.
So we need to start thinking about initiatives that build social capital and relationships of trust. Things like time banks, local currencies, community gardens, transition towns initiatives, permaculture programs, intentional communities, eco-villages. There are many ways that people can come together and build something functional. Local government decisions can make an enormous difference. Local governments can start by getting rid of barriers to people looking after themselves. Right now, there are often bylaws in a lot of places that prevent people doing things that would make them a lot more self sufficient. Getting rid of those barriers doesn’t even cost anything. And if you don’t think you local government might do something like that, I would strongly suggest that you step up to the plate and stage a coup, essentially, and run for local government
Relationships of trust are absolutely foundational, and this is really where we need to start. So if we can build a top-down bottom-up partnership between the municipality and the grass roots, that is a very powerful structure indeed.
Time banking can be very important, because it is an exchange of time and skills without the need to exchange money in the other direction. If you are just doing something for someone, you are trading skills directly one on one, then it depends what skills you have and what the other person has as to whether that trade works. It is difficult to scale that up, but if you put in place a time bank, where you are simply keeping track of how many hours people have done, whoever they did them for, how many hours people have contributed, how many hours they have withdrawn from the system, it doesn’t have to be a one on one exchange anymore. So you can create a situation where you can scale up reciprocity, and that can make a very large difference, because you are building interdependence, social networks, trust and respect, and that is very, very foundational.
Community finance
We need to re-localise finance. As I said before, a bubble creates a situation of artificial scarcity, where there is still people and resources, but no money to connect them. So we can think about addressing the liquidity crunch with alternative currencies, with different forms of liquidity. A money monopoly is a significant power, and it will be defended, but eventually that money monopoly will simply break down. So, if we have thought in advance of how we might introduce additional forms of liquidity, those can serve us very well.
Local currencies are fiat currencies, fiat means trust, in other words they only operate within the trust horizon, by definition, so they define a local area. What you have is something that circulates only in this local area because it doesn’t count as money anywhere else. And it is money circulating within a local area that defines what level of economic activity you can support. If you build in a feature called demurrage, then they can become even more effective. This is where you have to stamp the local money every month, in other words it devalues over time, so that’s a disincentive to horde it – it is a specific support for the velocity of money that keeps money in circulation within that local area.
Slow money is an important initiative. The goal of slow money is to get a million investors to commit 1% of their investment income to the real economy. That’s a woefully unambitious goal, because essentially that means people would be leaving most of their investment funds in a Ponzi scheme that might just disappear on them. So I think what we need to do is take the concept and vastly expand the scope of it, to say that what we need is to invest in the real economy – we need to invest in things that are real, that are foundational, that won’t simply disappear, because they are not purely virtual wealth.
Now there is an enormous demand for things like local organic produce, but these small producers, the cost of capital is high for them because they are perceived to be risky. If people extracted money from financial assets and put them in the real economy, then there would be an enormous increase in the scope of what can be done, and we would be building businesses in the real economy that had local supply chains and local distribution networks, and this would allow communities to become much more self sufficient. Bear in mind that those financial assets are going to get re-priced at pennies on the dollar at some point, so this is not a capital preservation strategy. People invest in financial assets because of the yield, but when you chase yield you chase risk – the risk is that you will lose the income and the capital. If you invest in something that’s real, that you genuinely understand, the risks are very much lower, and in the process of shifting investment into the real economy you can serve your community tremendously well, by ensuring the supply of local goods and services.
We are trying to build a robust system here. Dependency is vulnerability, so if we can create local self sufficiency, we are better able to face uncertainty with flexibility – to replace brittleness with flexibility by restoring safety margins. We need to minimise the consequences of being wrong, so if we are completely betting on the current system continuing its expansion, and the trend change hits, the losses are catastrophic and there is no way back. Now, contrast that with the situation where you assume the trend change is coming, and you prepare accordingly, you hold liquidity, you get out of debt, you build community, you gain control over the essentials of your own existence. If it doesn’t turn out to be as bad as you thought, you haven’t really lost anything, you’re just really well prepared to face whatever the future has to throw at you. So the risk is highly asymmetrical. Bear that in mind, because the future belongs to the adaptable – it is as simple as that.
Conclusion
In conclusion, we are preparing for a very different kind of world, We can expect a major initial shock and then a long period of adjustment. We need to decentralise and reestablish local control. No more business as usual. Local grass roots solutions are not going to give you business as usual – that’s a creature of cheap credit and cheap energy – both of those are going away.
Now some years ago former Vice President Dick Cheney in the United States said that the American lifestyle was not negotiable. I would generalise that to the whole world, the whole developed world anyway, and say that’s true, because reality is not going to negotiate with you. Reality is going to determine what is and is not physically possible, and it is our job to get our expectations in line with what reality can hope to deliver. If our expectations are pinned on ever increasing material prosperity, we are probably going to be disappointed. But it’s not a new iPad every year that makes people happy; it’s community, it’s relationships of interdependence. If we shift our expectations towards voluntary simplicity and working with other people, then we can rediscover what it means to be human, and this is a profoundly positive thing.
So, to sum up I would say you can’t change the waves, but you can learn to surf. These swings of expansion and contraction are bigger than you are. Nobody is controlling them. You can’t prevent the fact that bust will follow boom – it always has and it always will – what you can do is identify where you are in the cycle and act accordingly. It is about learning the lessons of history and applying them in our time. We are the first generation that has ever had the opportunity to do that, and it is an opportunity we simply can’t afford to waste.
"Sustainability is when if you keep doing what you're doing, you'll be able to keep doing what you're doing."
Further Reading
https://www.fixingthesystem.net.au/2018/05/15/nicole-foss-on-money-and-financial-crises/#thefunctionsofmoney
Resilience as Graceful Extensibility to Overcome Brittleness
