My post, "Escaping the Thanatoeconomic System," marked a change of my mood from mildly optimistic to quite sober (maybe even somber), as I came to realize the full implications of some of the societal trends I have been following. For a long time I had realized that not only is our present economic system breaking, but that it is not in the interests of the masters of that system to foster local, resilient alternatives for ordinary people. Yet I had been reasonably optimistic that ordinary people of small means could engineer local, resilient safety nets of alternative systems by which they might decouple from the official economy. Of course, this ability would depend on the presence of local resources for these safety nets, as well as a certain minimum level of access to these resources.
While I still think that some members of the populace might be able to build such safety nets, I have recently come to believe that the majority of Americans will probably not be fully able to do so at present, due to lack of access to the necessary resources. While there are some things that most people will be able to achieve, there are also things that will be beyond the reach of all but the most affluent.
One thing that may be beyond the reach of most people at present is building local, permanent resilient neighborhoods and communities. The reasons for this are obviously tied to land use and ownership. Most people rent, or they “own” in the sense of making installment payments on a loan used to buy a house. During the run-up to the 2005 peak of the housing bubble, prices of homes were continually and wildly inflated, far beyond the ability of most people to pay, while wages for most workers remained stagnant or declined in real terms. Then the economic collapse began, triggered by the rise in oil prices leading to the spike in 2008. That economic collapse has resulted in millions of jobs lost, as well as further erosion of incomes; yet there has been no debt relief for people who bought houses during the bubble years. A debtor living in a regular, modest house (I'm not even considering McMansions) is not resilient in the face of economic shocks, but is brittle, and is likely to end up out in the street in the event of a job loss or some sudden large expense.
Now one thing that could have provided opportunity for many people to build resilience is a sudden, large-scale reset of real estate prices nationwide. Had prices been allowed to fall to a level that people could actually afford in this present economic climate, more people would have been able to find homes that they could afford to stay in for the long term, and they would have been free to work on other strategies of resilience, such as gardening and energy efficiency. Indeed, there were and are places where this reset has occurred – places like Detroit and Flint, Michigan, and other cities in the Midwest. As word got out about home and land prices in places like these, forward-thinking people moved to these places in order to build a more sustainable life for themselves.
Yet these places also attracted speculators looking to get rich by playing a real-life version of “Monopoly.” I believe they also attracted the notice of the masters of the banking and finance sector as well as their friends in various levels of government. These people had a vested interest in preventing any fall in real estate prices, since most properties had been bought on credit and these properties were collateral for securities priced at an inflated value. What has therefore emerged over the last several months is a concerted effort to keep the price of housing high by artificially restricting access.
Thus we have seen cities bulldozing abandoned properties; cities foreclosing on people who can't afford to pay their property taxes; the withholding of foreclosed houses from the market by the banks that own them; and cities creating “land banks” consisting of abandoned properties which the cities either demolish or remodel in order to collect revenue and bring housing prices back up. (Sources: “Unpaid Property Taxes Hit Cities, UPI, 30 July 2009, http://www.upi.com/Top_News/2009/07/30/Unpaid-property-taxes-hit-cities/UPI-99581248962645/; “Land Banks Gain Popularity As Way To Fight Urban Blight,” USA Today, 9 July 2009, http://www.usatoday.com/news/nation/2009-07-09-landbanks_N.htm; “Flood of Foreclosures: It's Worse Than You Think,” USA Today, 23 January 2009, http://money.cnn.com/2009/01/21/real_estate/ghost_inventory/index.htm)
Many of these strategies were anticipated in the United States Housing And Economic Recovery Act of 2008, signed into law by President Bush, which, among other things, set aside $4 billion for the establishment of land banks and the redevelopment of abandoned, foreclosed or “blighted” properties, in order to boost real estate prices. These strategies continue to be supported by the American Recovery and Reinvestment Act of 2009, signed into law by President Obama. These strategies are part of a broader effort to protect the rich from a loss of the notional value of their assets, yet they continue to put basic resources such as houses and land out of reach of ordinary people of limited means. Any regular person trying to buy a house nowadays is still likely to be subjected to an unsustainable burden.
And the attempt to reinflate the housing bubble is only one example of the imposition of unsustainable burdens on the American working class. Another glaring example is the continued bailouts of the banking sector, bailouts which now number in the trillions of dollars, just to cover the losses of bank “assets” which had been built on loans that are now unrepayable. Lest anyone take this as a signal to become stupidly partisan, let me remind any readers that this mess is bipartisan. Both Democrats and Republicans are to blame. The net effect of the bailouts will be to saddle ordinary Americans with yet another unsustainable burden – that of being turned into collateral for a huge mass of bad loans.
These are just a few examples of the way in which our predatory system is taking from ordinary people the very resources they need in order to foster resilience. These examples illustrate the extent to which the masters of our present system will go in order to maintain the status quo. It was considering these examples that made me increasingly pessimistic about our prospects for a “soft landing,” an orderly and equitable transition to a state of lower economic activity and energy use. I don't think we will achieve a “soft landing,” because the masters of the present system will do their best to keep things as they are until they simply can't any longer, and then some things will break down catastrophically.
What will such a breakdown look like? I can't say with any confidence. There are people much cleverer than I who have thought about these things. I've read Dmitri Orlov; now I may get my hands on a copy of Joseph Tainter's The Collapse of Complex Societies. Is now the time for communities and neighborhoods to try to foster resilience? I think it may not be possible at this time. (But if anyone can prove me wrong, feel free. I'd welcome it.) It may only be possible for individuals to foster resilience, and if communities try for such a goal, it may only be possible for groups of nomads or migrants. Building permanent, local resilient communities might have to wait until our present system has gone a little further down the road of collapse. In the meantime, allow me to recommend Jeff Vail's blog (http://jeffvail.net), where he tackles some of the same questions (although he does a much better job, in my opinion). His latest series is called “The Rise of the Diagonal Economy and the Transition to Decentralization,” and he's just getting started. There is also a post on the internet titled, “"Peak Civilization": The Fall of the Roman Empire,” by a man named Ugo Bardi. Note especially what he says about the emperor Diocletian.
“What advice do you have, then?” someone may ask. Unfortunately, I don't have any right now. I need time to think about this some more. These thoughts have definitely changed the character of the upcoming interviews I was planning to do for this blog; now I'll have to approach things from a different angle. Someone else might be asking, “Do you see any other examples of large-scale hindrances to community resilience?” My answer is that if I tried to think of all the potential hindrances, I'd be here typing until midnight, and I'm trying to cut down on that sort of thing... ;)
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