Difficult times descending on U.S.

Posted August 9th, 2010 in Blog, Featured 4 Comments »

Fostering Ecological Hope
Today from Margaret Swedish:

We are facing some painful and prolonged difficulties here in the U.S. as the true nature of the economic downfall begins to sink in. We have written before – this is not just a cyclical recession, but rather capitalism is going through a major restructuring, a new phase.  It is shedding workers because it doesn’t need them anymore.  It is shedding various means of production – factories and such – because it doesn’t need them anymore.  In fact, these very things have become a drain on profit-making.

So much of that capacity of production and labor was at the service of the consumer economy, including real estate and those credit cards, which was fueled in the years before the 2008 collapse with massive debt.  Now that that bubble has burst, now that consumers and home owners have necessarily pulled back – because of things like unemployment – we see nothing that can recreate what was a fake economy to begin with.

What kind of future will we create for her? - photo by mom

We also see the evidence of the restructuring in the fact that the financial sector has recovered fairly well and that weak economic growth is happening – but no recovery of jobs or production.

Friends, those that tell you we can recover by getting that economy back in gear, by getting investors to start putting money back into production so that companies will start hiring again and replace those millions upon millions of lost jobs, are either deceiving you or else not understanding the nature of the crisis.

I want to write more about this later in the week, but for now will leave three links that shed some light on what is going on. They’re all from the NY Times.

First, Jobless and Staying that Way, by Nelson Schwartz. You can hear the struggle in understanding the dynamics of ‘The Great Recession’ among economic policy people over this question of whether or not we are dealing here with a cyclical problem or with what many are calling the ‘new norm,’ a permanent or prolonged period of unemployment (officially at 9.5%, but the real figure something around 16%).

Then, Home Economics, by Judith Warner. She dismisses pretty thoroughly any romantic notion that the Great Recession will somehow recalibrate our values back to the simple, to family life, etc. Comparing that false nostalgia to the Great Depression, she reminds us that, in reality, impoverishment brings about suffering and enormous stresses on families, and that the depression was not overcome by a return to individual down-sizing and simpler lifestyles but by social policy at the government level.  In other words, government has to intervene in this new era of high unemployment and savage financial capitalism if the society is to hold together.

We are not holding together right now.

Finally, this column from Ron Lieber, A Class War Over Public Pensions. He describes here a dynamic few people want to talk about out loud – that as most folks are losing jobs and security, public sector workers with generous pension packages that must, by law, be paid out over their lifetime – which can mean up to 20-30 years past retirement – are expecting the taxpayer to fund those payouts – and the money does not exist. So governments at various levels will have to figure out how to wrest money from the larger society to keep these pensions funded, and you can see the great class division developing here. By law we must pay, in reality we cannot, and the attempt to do so will increase the terrible tensions among classes already dividing us like nothing since pre-WWII.

Interesting times.  How well do you think we’ll do?  I am not optimistic about our society holding together as we think through the big shifts in our models of economy in a time of severe ecological limits. The overall social and political discourse remains divisive, fragmented, and inciting of class and ethnic animosities. We, you and me, our faith communities, educators, cultural workers, have got to start figuring out how to overcome that ugly discourse with something more rational, hopeful, and inspiring.

Your thoughts are extremely welcome.

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4 Responses

  1. hombredelatierra

    Is a New Deal still possible? How will Peak Oil inpact upon the capacity of federal or central governments to fund large scale public works?

    These unaddressed questions MUST be addressed as we begin to study and appreciate the range of public policy options before us.

    The Peak Oil Hypothesis argues that the days of cheap oil are over (for good, not a “few years”). All the cheap stuff has been extracted and burned (or wasted making plastic one use only coffee stir sticks for fast food outlets..). The only oil remaining – and there’s lots! – is hard to get at and / or environmentally costly to refine (Gulf of Mexico, Alberta Tar Sands..).

    Economists call this a “tight supply” situation. Growing and high demand for oil (China, India..) will result in little or no increase in production: a situation observed for some years now, globally, so this is not a “hypothetical” consideration but reflects current and long-term economic reality. High demand + tight supply promote “speculative bubbles”, like the one that pushed oil to about $140 bbl in the summer of 2008. (Some observers feel that this bubble may have been the REAL trigger of the current financial crisis: the subprime mortgage scam of that autumn would then be a contributory but secondary cause..)

    Peak Oil is A CHALLENGE WE HAVE NEVER FACED BEFORE. Industrial society was based upon and posits for its continued survival a convenient, free flowing, expandable, reliable source of CHEAP, CONCENTRATED ENERGY. Since energy in the future will be neither cheap (peak oil and, soon, peak coal) nor concentrated (sunlight, ocean wave energy..), industrial society would appear to be doomed. Thus the coming changes may well be much more profound and dramatic than our “pundits” – who have tragically led us into the current impasse – would dare imagine..

    The coming debate – if it is to be RATIONAL and GROUNDED in PHYSICAL REALITY – must deal with the impending collapse of centralized control structures as these, too, are dependent upon cheap, reliable, convenient, concentrated energy sources. Communities will have to learn to become self-reliant and self-sufficient to a degree that most people living in our current “globalized” industrial society simply cannot image. This “downsizing” will pose enormous problems of political and social stability in many (? most ?) places.

  2. hombredelatierra

    In saying that “industrial society would appear to be doomed” should be interpreted to mean “industrial society as we know it”: de-localized (“globalized”), dependent upon exogenous (foreign) sources of energy and raw materials and upon exogenous markets for sales of its products, “non-proprietary” (in the sense that local workers do not own the means of production they employ),..

    New models of “industrial artisanry” – ?neo-Guild system? – must be re/discovered if we are to preserve many of the gains we have made in science, technology, and governance over the past half millennium.

  3. Margaret

    And Peak Oil is only one of the shortages looming. The other one, which may be even more significant over time, is the water shortage crisis. The United Nations has even taken note of this reality, recently declaring access to clean water a fundamental human right. The U.S. abstained, despite the overwhelming support of 122 nations.

    The UN has also urged the world to begin to wean itself from livestock agriculture, esp. industrial agriculture, for reasons of water issues, deforestation, and global warming.

    Industrial agriculture and expansion of exurbs and other human development projects into more and more green spaces is also disrupting natural habitats, groundwater flows, and wetland destruction, along with depletion of aquifers.

    So we are facing severe crunches in regard to some of industrial society’s most basic needs.

    Again, my question is, how well will we do? I can only speak from the vantage point of this US culture, and right now, well, we ain’t doing so good. My fear is that social tensions will grow sharply as more people fall into poverty, living becomes more stressful, old expectations crumble. There is no discourse to help guide the society towards a more resilient, locally-based way of life, with shared sacrifice and shared down-sizing.

    The discourse is crucial; articulating clearly why this is happening is crucial (especially if we are to counter the dangerous scapegoating going on right now); articulating a shared vision for how to move through this era of abrupt change is also crucial.

  4. hombredelatierra

    “My fear is that social tensions will grow sharply as more people fall into poverty, living becomes more stressful, old expectations crumble. There is no discourse to help guide the society towards a more resilient, locally-based way of life, with shared sacrifice and shared down-sizing.

    The discourse is crucial; articulating clearly why this is happening is crucial (especially if we are to counter the dangerous scapegoating going on right now); articulating a shared vision for how to move through this era of abrupt change is also crucial.”

    Maybe it is grasping at straws but there a few signs for hope, a few indicators for solutions in the very nature of the problems we face: “each problem contains the seed of its own solution”.

    1- the value system that structures bourgeois society (or, at least, our present form of bourgeois society) is revealing its bankruptcy: “they’ve got enough rope to hang themselves with”. Here is one reason for hope.

    2- deglobalization of the economy and re-regionalization will be forced upon us; this will not be an ideological option to chose as we may. It is being imposed by physical realties (Peak Oil..) In itself this situation is nuetral: the devil is in the details! Our job, as humanists, is to try to cushion the transition, to minimize suffering – especially in our home communities – and to do all we can to maximize the chances of a successful transition. Nevertheless, the general movement – toward decentralization / re-localization / local resilience and autonomy – IS in the right direction. History is on our side (I think). Another reason for hope!

    3- As industrialization winds down, environmental impacts due to botched industrial technologies will diminish. You or I will not live to see the benefits but they will come. Notice how the forests around the Tchernobyl disaster regenerated, despite the increased background radiation levels. Another reason for (long term) hope..

    4- Population WILL decline in this century. Given our botched industrial technology, the planet cannot support our present numbers. We are out of ecological balance with the planet’s life sustaining capacities on many fronts. This situation CANNOT last (it is, in mathematicians’ jargon, a “transient”). Population will drop, either through family planning or through Mother Nature’s harsher regime: famine, plague and war. To us to decide, HOW population will decline and (within limits) by how much. Regardless of the means, the general trend, reduced population, is another reason for (long term) hope. (I concede that it may be a bitter pill to swallow for those living in the short term..)

    5- We have more powerful means of communication today than ever. This development is, in itself, probably nuetral: we can use the new technology to divert our attention from real problems or we can use it to exchange info / knowledge / experience to solve those same problems. New communication / information technology is a POTENTIAL asset, another reason for hope..

    There are 5 powerful historical processes which offer a perspective of long term hope (long term gain through short term pain):

    – revelation of bankruptcy of Old World Order

    – forced deglobalization / re-regionalization / “modularization” of society and its economic activity

    – biological resiliency of nature (including ability to survive asteroid strikes..)

    – human population decline

    – new communication / information technologies

    and I would add

    – an emerging scientific / philosophical worldview build on the self-organizing complexity of the world, particularly the living world. This offers hope for designing the next World Order in a more intelligent fashion.

    So that makes an even half-dozen reasons for hope..