Our Least Resilient Neighborhoods

(Warning: This post is long.) Non-minority, middle- to upper-middle class families are the media's frequent focus nowadays when discussing struggling neighborhoods, households and families in the context of our present economic crisis and the challenge posed by Peak Oil. This is seen in recent news articles such as the New York Times piece titled, “You Try To Live on 500K in This Town”; the CNN stories titled, “Bad Economy? Do What You Love,” and “From Beverly Hills To Shoveling Manure On A Farm”; the Colorado Springs Gazette piece titled, “Youth Hockey Surviving Economic Crunch”; and the CBS Evening News story titled, “One Family's Recession – How A Single Family's Life Is Shifting Amid A Slumping Economy.”

These stories and others like them have common elements: namely, how affluent, usually blond, educated suburbanite and high-class urbanite families are coping, financially, psychologically and interpersonally with being forced by present circumstances to give up some of the more optional parts of their lives. Some stories chronicle the mental and emotional processes some of these individuals go through in discovering that things formerly considered to be “necessities” are, in fact, optional. And these stories are all uniformly told in warm, sensitive, empathetic tones by the American mainstream media.

But there is another, less-noticed segment of the American population that is getting absolutely slammed by the present economic collapse. Even before the collapse, their lives were lived precariously exposed above an unforgiving economic landscape lacking any safety net. Many of these people are people of color. Most of them would dearly love to trade their present lives for the supposed struggle of “trying” to live in a place like New York City for “only” $500K a year. The stories of most of these people are not covered by the mainstream media. These are the citizens of our least resilient neighborhoods, who lack the capital needed to recover from even the smallest crisis. I'd like to begin in some small way to tell their story now. My story has paralleled their story at significant times in my life. I will speak from the point of view of the black American community, since I am black, although the processes which have existed for a long time in the black community are now working everywhere.

While Men Slept...

The American civil rights struggle of the 1950's and 1960's was a landmark time that yielded important victories for black people struggling against murderous racism. Those victories included the Brown vs. Board of Education Supreme Court ruling that ended school segregation; the Civil Rights Acts of 1957, 1960 and 1964; the Voting Rights Act of 1965; and the first appearances of black men and women in intelligent roles in TV and film. Great legislative and judicial strides were made at the Federal level to render both de jure and de facto segregation illegal, and these were followed by affirmative action programs to redress the evils caused by the old segregationist laws and social arrangements.

During the 1970's, however, some voices began to make premature declarations that “We've made great strides! Surely America has risen above its ugly past. The civil rights struggle is over!” And in the 1980's, certain individuals and groups began stating that affirmative action was no longer needed, having accomplished its purpose. Some of these people even initiated lawsuits designed to end affirmative action in higher education and hiring for government jobs. Such declarations of a successful end to the civil rights struggle served to dull the awareness of the nation and to put everyone – black people included – to sleep. But the truth is that affirmative action had not gone nearly far enough in rectifying the inequalities between the American black community and the rest of American society.

The secret dismantling

By 1970, many of the gains made by black America were already beginning to be dismantled. Some elements of that dismantling were deliberate, but others were simply a consequence of the general re-ordering of American society due to changing economic conditions.

To understand the re-ordering, remember that the 1960's were the period of the last great expansion of industrial/manufacturing activity in the United States. This resulted in increased demand for skilled manufacturing employees and an increased number of openings for highly-paid manufacturing jobs. This increase in demand occurred at the same time as the strongest and most visible pushes were being made by those in the civil rights movement for equal access to jobs. Black workers were concentrated most heavily in those cities whose manufacturing base was expanding and where the demand for skilled manufacturing workers was greatest. And skilled, highly-paid manufacturing jobs were a key rung on the ladder of advancing material well-being, since such jobs could be used to pay for things like home ownership and college education.

However, the 1970's saw the reversal of manufacturing in the United States, the outsourcing of manufacturing overseas, and the beginning of the transformation of the American economy into a “service” economy. This coincided with the peak and resulting decline in American oil production and was partly caused by that peak. While this transformation devastated many communities, especially cities that depended on local industry, it was especially hard on the black community, since so many black workers had begun to rely on skilled, highly-paid manufacturing jobs as a means of climbing the ladder of advancement, and now this rung was being taken out from under them.

There was also the dismantling of enforcement of equal opportunity legislation and judicial rulings. The United States Equal Opportunity Employment Commission was created via the 1964 Civil Rights Act championed by Presidents Kennedy and Johnson and passed by Congress. As originally created, the EEOC was a rather toothless body incapable of any real enforcement. But surprisingly, it was President Nixon who proposed giving the EEOC the power to file discrimination suits against companies on behalf of citizens. This power was granted by Congress in the early 1970's. And President Carter further amplified the power and scope of the EEOC.

But President Reagan sought to dismantle the EEOC, changing it from being an activist champion of equal employment to being merely a rubber-stamp approver of a status quo enacted by the private sector. Reagan packed the EEOC with appointees who believed that government was the problem in modern society and not the solution to problems. He also slashed more than 10 percent from the EEOC budget during his first years. This dismantling of minority protection was continued under President Bush (the Elder) from 1989 to 1992, as noted in a Chicago Sun-Times article from 1992 which documented Senate hearings in which plaintiffs described the poor performance of the EEOC under the chairmanship of Bush appointee Evan Kemp (who was a champion of the disabled, by the way).

Although funding increased modestly under President Clinton, the Clinton-appointed EEOC chair channeled a large proportion of discrimination claims to binding arbitration instead of more aggressive action, and encouraged a large number of plaintiffs to settle with their employers instead of investigating their complaints. And the administration of President Bush (the Younger) resulted in a loss of 20 percent of EEOC staff from 2000 to 2006, constant calls by President Bush to cut the EEOC budget, and a swelling of the EEOC's case backlog to over 40,000 in 2007. In 2008, when Congress approved an appropriations bill that would have increased the EEOC budget by $50 million more than the President's request, Bush threatened to veto it.

This dismantling of protections and the assertion that such protections were not needed also extended to housing, where studies performed in the 1980's showed clearly that housing discrimination still existed. A Washington Post article from 1993 described the “collapse” in HUD enforcement of anti-bias policies at the national and regional levels. This set the stage for the present sub-prime crisis as experienced by the minority community.

Present Threats To The Minority Community

There are three main threats menacing the minority community at present. The first is the economic victimization which exists because of the dismantling of government protections. That victimization is via predatory lending practices leading to foreclosures and loss of home ownership in minority neighborhoods, as well as ongoing job discrimination. In 2005 and 2006, over 50 percent of all loans made to black Americans, and over 40 percent to Latinos were subprime, as opposed to only 19 percent of white borrowers. Illinois Attorney General Lisa Madigan recently stated on National Public Radio that a black American earning more than $100,000 was more likely than a white person who earned less than $35,000 to be put into a high cost, subprime loan.

These loans carried “exploding” adjustable rates and high prepayment penalties which made them impossible to refinance. These loans were also made by brokers who received kickbacks from lenders for selling subprime loans. And they were often made with the expectation that the lender would sooner or later be able to make money through repossession and resale of a borrower's house. In other words, these loans were designed to fail. The most damnable aspect of these loans was that many of these loans were not marketed to people wanting to buy McMansions, but were marketed as a way for first-time borrowers with existing mortgages to save money on monthly payments through refinancing or as a means to finance home improvements.

Now these loans have begun to bear their poisonous fruit, people are being thrown out of their homes, and these homes sit vacant or are vandalized, or are targeted for demolition to make way for “redevelopment” and “gentrification” to provide new opportunities for builders, lenders and realtors to make money.

The second threat to the minority community comes from the war on drugs and the disproportionate incarceration that has resulted from it. The war on drugs as originally conceived by President Nixon was a genuine attempt to halt the spread of drug use in the United States, and it relied on treatment as its first weapon. But that war took on a different character under President Reagan, who made mandatory sentencing one of his weapons of choice, and who signed a drug enforcement bill with provisions deliberately written to favor harsher sentencing of minorities. This was done deviously, by such things as imposing more lenient sentencing guidelines for the use of powdered cocaine (preferred by white users) versus crack cocaine (preferred by black users). As a result of this bias (perpetuated through the Clinton and Bush presidencies), in 2006 black Americans made up an estimated 15 percent of drug users, but accounted for 37 percent of those arrested on drug charges, 59 percent of those convicted, and 74 percent of all drug offenders sentenced to prison. Even now in places like Portland, Oregon, black men are more likely than white or Hispanic men to be stopped, arrested, jailed and sentenced to prison for the same offense.

But there is also evidence that the Federal government took an active role in promoting drug use in the black community, in part to fund covert operations to overthrow governments hostile to American business interests. This evidence was first presented by journalists on behalf of the Christic Institute in 1986, and was corroborated in an investigation by Senator John Kerry in 1988, as well as by journalist Gary Webb in 1996 reports in the San Jose Mercury News. Further corroboration comes from a 1998 report published by CIA Inspector General Frederick Hitz, as well as the writings of Catherine Austin-Fitts, who also wrote of the efforts of the Clinton Administration to suppress this evidence.

The third threat to minority communities comes from gangs and gang culture. Undoubtedly there is a home-grown element to this culture, as evidenced in the “Soul Patrol” I encountered in my younger days. This “Soul Patrol” consists of belligerent young black men who attack any black person whom they consider to be acting too “white”. “Acting white” is defined as speaking intelligently, working hard, trying to educate oneself, or showing an interest in anything other than hanging out, chasing women, or “getting over” on the system. Later I discovered that other ethnic groups have their own version of the “Soul Patrol.” This “Soul Patrol” mentality directly reinforces the present gang culture. But the times now facing us will demand that all of us function as productive and useful members of society, regardless of ethnic background. Those who refuse, who choose instead to be homeboys keepin' it real, may find themselves facing a backlash from the productive citizens of our society.

Yet I have to wonder sometimes if the present reinforcement of gang culture is coming entirely from within the minority community. Just as the drug problem in the minority community is being sustained by forces outside that community, I suspect that the same thing may be true of gang culture. I think especially of the popularization and promotion of gangsta, hip-hop and other “urban” culture in the mainstream media, which continues to reinforce a dysfunctional stereotype of “cool” blackness that sells, yet has nothing to do with reality. But researching and developing that hypothesis is a subject for another day.

Fostering Resilience

One measure of neighborhood resilience is “the Solari Index,” a simple metric devised by Catherine Austin-Fitts to describe how safe, healthy and liveable a neighborhood is. Ms. Fitts also points out in her writings that extremely powerful and rich interests have made a great deal of money from the business of breaking neighborhoods. Minority neighborhods have been the historical targets of choice for breakage, though the appetite of the rich and powerful has expanded to the point where they are breaking any neighborhood whose breakage might yield a profit.

Building resilient neighborhoods therefore consists of devising effective defenses against breakage, repairing the culture of the neighborhoods and fostering neighborhood self-sufficiency. I will explore these elements in further posts, God willing.

Links To Sources:

Concerning How The Affluent Are “Coping” with Recession

• “You Try To Live on 500K in This Town,”New York Times , (www.nytimes.com/2009/02/08/fashion/08halfmill.html?_r=1)

• “Bad Economy? Do What You Love,” CNN, (www.cnn.com/2009/LIVING/02/24/economy.career/index.html)

• “From Beverly Hills To Shoveling Manure On A Farm,” CNN, (www.cnn.com/2009/LIVING/02/26/economy.survivor.farm/index.html?iref=mpstoryview)

• “Youth Hockey Surviving Economic Crunch,” Colorado Springs Gazette, (www.gazette.com/sports/hockey_47994___article.html/dues_year.html),

• “One Family's Recession – How A Single Family's Life Is Shifting Amid A Slumping Economy,” CBS Evening News, (www.cbsnews.com/stories/2008/01/11/eveningnews/main3703133.shtml?source=RSSattr=Business_3703133)

Concerning Black Economic Progress, Home Ownership, Predatory Lending and “Steering”

• “Black Homeowner News,” www.blackhomeownernews.com/index.html

• “Black Families' Economic Progress Slowed,” www.boston.com/news/nation/washington/articles/2007/11/13/black_economic_progress_slowed/

• “Home Loans Discriminate, Study Shows,” New York Times, 13 May 1998 (from the Clinton years; take note!), http://query.nytimes.com/gst/fullpage.html?res=9802EEDC1430F930A25756C0A96E958260&fta=y

• “Good, Bad of Black Homeownership Discussed,” NTIC blog, http://nticnews.blogspot.com/2005/08/good-bad-of-black-homeownership.html

• A Turbulent Voyage: Readings In African American Studies, Third Edition, Floyd W. Hayes, et. al., Rowman & Littlefield Publishers Inc., 2000 (http://books.google.com/books?id=Wu0qQdMCdvIC&pg=PA480&lpg=PA480&dq=black+employment+manufacturing+1970%27s&source=bl&ots=GUu0cnRdc8&sig=7Nx2FseYSZAhn7GrItJDX-qXD9g#PPP1,M1)

• “Black Job Loss Deja-Vu,” Betsy Leondar-Wright, Black Commentator, http://www.blackcommentator.com/95/95_black_jobs.html

• “Where Did The Water Come In?”, Katrina Vanden Heuvel, The Nation, 20 February 2008, http://www.thenation.com/blogs/edcut/287768

Concerning U.S. Federal Government Civil Rights Protection

• “Richard Nixon,” Wikipedia, http://en.wikipedia.org/wiki/Richard_nixon. (Nixon may be one of America's most misunderstood and misrepresented presidents, although some of this was of his own doing.)

• “A Letter From J. Clay Smith,” United States Equal Employment Opportunity Commission, http://www.eeoc.gov/abouteeoc/35th/voices/smith.html

• The United States Since 1980, Dean Baker, Cambridge University Press, 2007 (www.cambridge.org/catalogue/catalogue.asp?isbn=0521860172 and http://books.google.com/books?id=Ofb-1KeZJ1IC&pg=PA75&lpg=PA75&dq=eeoc+%22president+reagan%22+budget&source=bl&ots=4J0HNVmENO&sig=gEB-rsPFgZH4osCL75HYHgtvXpA)

• “Jobs Discrimination Agency Lightening Its Load,” New York Times, 22 February 1999, http://query.nytimes.com/gst/fullpage.html?res=9905E3DF133DF931A15751C0A96F958260&sec=&spon=&pagewanted=all

Concerning Drugs, Gangs and the Solari Index

• “The War On Drugs' War On Minorities,” Los Angeles Times, 24 March 2007, http://www.latimes.com/news/opinion/commentary/la-oe-huffington24mar24,1,4064763.story

• “The War On Drugs,” Wikipedia, http://en.wikipedia.org/wiki/War_on_Drugs#Possible_U.S._government_involvement_in_cocaine_trafficking

• “Narcodollars For Beginners – Part 3, Drugs as Currency,” Catherine Austin-Fitts et. al., http://www.drugwar.com/fittsnarco3.shtm

• “Solari And The Rise Of The Rule Of Law,” Catherine Austin-Fitts, http://solari.com/articles/SolariRiseRuleLaw.htm

Neighborhood Resiliency - An Introduction

You tell me there's an angel in your tree.

Did he say he'd come to call on me?

'Cause things are getting desperate in our home,

living in the parish of the restless folk I've known.

“Burn Down The Mission,” lyrics by Bernie Taupin

As I have become more aware of Peak Oil, resource depletion and environmental destruction, I have also become more aware of the probable effects these crises will have on the communities in which we live. While the biggest part of those effects is economic, there are and will be many other effects. The result of all these effects is likely to be hugely negative unless a neighborhood has existing neighbor-initiated, community-based systems, relationships and connections which are resilient in the face of stress. “A neighborhood's resiliency depends on the stability of its initial equilibrium state. A neighborhood that possesses a large stock of social and physical capital is not easily dislodged from its beneficial equilibrium, but if dislodged by adverse shocks, its reservoir of capital enables it to return to its initial equilibrium.” – Margot Breton, “Neighborhood Resiliency,” Journal of Community Practice, June 2001.

The problem is that many (perhaps most) of the neighborhoods, communities and cities in America are now very fragile. They do not possess large stocks of social and physical capital; instead, no one knows his or her neighbors and almost everyone is dangerously in debt. The present economic crisis is unraveling a great many of the people in these neighborhoods, and the government on all levels is doing very little to fix this.

When I think of neighborhood resiliency, I do not look to the government to provide answers or help, although sometimes I am pleasantly (even delightedly!) surprised by some of the things my particular city is doing. Yet I have decided not to waste my breath/writing paper/Internet time trying to tell Washington my idea of a policy solution. I don't think even now that they're really interested in helping us. Instead, I believe that building up resilient neighborhoods is up to the neighbors who live in them. We will have to be the fix for the problems we face.

Nor have I decided to abandon cities and neighborhoods altogether in favor of holing up on a spread of several wilderness acres with a stash of five tons of baked beans and 5,000 rounds of ammunition. Some may elect to do this, but it's very clear that we can't have 300 million Americans all trying to do this, and it seems to me to be a rather short-sighted and selfish approach to our present times. Instead, I see myself as being somewhat like Billy Joel in the 1970's, who was living in Los Angeles and heard that New York City was going bankrupt, as well as hearing the smug sneers of Angelinos gloating over New York's potential demise. The sneers made him so angry that he said, in effect, “Hey! I'm a New Yorker! If that city's going down, I'm going down with it; we stand together!” As a result, he returned to New York, and wrote, “Say Goodbye to Hollywood.”

I live in a city. Yes, the city has problems and challenges, and the stress of our present emergencies may very well make those problems worse. But I'm getting a little tired of people (even though these people are very smart and far-sighted) who only have time to talk about the likely negative effects of Peak Oil and economic collapse, who have no solutions other than to “bug out and head for the hills,” nor any predictions other than rapidly spreading crime and chaos, who seem to relish the potential onset of “Mad Max – the 3D, Real-Life Version.”

For me, it seems a nobler challenge and a fight worth fighting to try to improve the place where I live, trying to make it a decent place in which decency is honored. (“So why didn't you stay in Southern California?” some may ask. Sometimes I wonder if I should have – but when I left I was trying to pick my battles wisely, and I had a mortgage on which I still had 25 years of payments to go.) So here I am, kicking off an on-again, off-again series of posts on building a resilient neighborhood. I'll be writing about some of the efforts I will undertake here in my own neighborhood. One thing: I have decided I'm going to have a bunch of my neighbors over for coffee some time in the next three weeks. So I have to get the house ready for company. And now that I've said it over the Internet, I guess I have to go through with it.

But I will also write more analytical posts dealing with building neighborhood resiliency, starting with an exploration of the factors which have contributed to making our neighborhoods brittle. This applies particularly to minority neighborhoods, though the factors are now present in almost all American neighborhoods. I will focus especially on the role governments and big businesses have had in undermining neighborhood stability. An understanding of how things got to be so broken and messed up is crucial if we're going to have any chance of fixing things.

One last thing: Both Jeff Vail (http://jeffvail.net/) and John Robb (http://globalguerrillas.typepad.com/) have written about resilient communities in the context of adapting to Peak Oil. You may want to check out their articles. I will take a slightly different approach in my analysis, however.

The Timing Of The Next Oil Price Spike

The world and its official global economy have reached the end of a crucial phase. The beginning of that phase was in 2005, when the world's growth economy first began to encounter the reality of constrained global oil supplies. In May 2005, the world's oil producers produced slightly over 74 million barrels of crude per day (or 85 million, if one counts natural gas liquids, “oil” from tar sands, biofuels, and other non-conventional sources). This was an all-time production record which was not exceeded for at least 2 ½ years, if one believes the production numbers of the International Energy Agency (IEA) and the United States Energy Information Administration (EIA). Some believe that the production numbers for 2008 were inflated, and that the May 2005 record is indeed an all-time record that has never been exceeded.

What is clear, however, is that global oil production stayed in a relatively flat band right around 85 million barrels per day from May 2005 until September 2008. Those who study Peak Oil have called this period the time of the “bumpy plateau,” where oil suppliers struggle to find enough new fields and start enough new projects to offset production declines in existing fields. We know we are past Peak and that the suppliers have lost the struggle when total daily world production begins to fall in spite of the best efforts of oil suppliers. At that point, the world has fallen off the bumpy plateau and is now on the downside of Hubbert's Peak. One of the signals that we are past Peak is an inexorable rise in the price of oil and petroleum products.

The 2007-2008 price spike may therefore have been such a signal. Oil climbed from around $65 per barrel to over $147 per barrel in a little over nine months. There were also spot shortages of petroleum products in various places, though this was not widely reported by the American media. Those who study Peak Oil devised a few theories to describe what they thought would happen as a result of the price spike due to Peak Oil. The consensus of many was that a sufficiently severe spike would derail the global economy, causing a recession and collapsing economic activity. This would also cause the price of oil to fluctuate wildly for a time before resuming its inexorable upward climb.

All these things have happened. The oil price spike of 2008 caused not just a global recession, but the beginnings of a depression potentially so severe that it may just end the official global economy. The price of oil has also crashed – from $147 per barrel to around $40 per barrel today. Of course, the fall in price is not due to finding new supplies (no one has found any large new, cheaply extracted supplies), but is due, rather, to falling economic activity. It now appears that the world has no more new supplies of cheap, easily-gotten oil.

So what happens next? Some analysts have stated that the price of oil will remain low until the world attempts an economic recovery. At that point, perhaps a few years into the future, global demand will run up against shrinking supply and there will be another price spike, followed by the return of a global recession or depression. But a report released in January of this year presents a different view – namely, that the coming price spike won't wait for an economic recovery, but that it will begin this year.

The report, titled, “Oil Prices: Another Spike Ahead,” was written by Jeff Rubin and Peter Buchanan, and is in the 23 January edition of StrategEcon, a publication of CIBC World Markets. (You can find it here: http://research.cibcwm.com/res/Eco/ArEcoMI.html. Click on the report titled, “Reflation.”) The report analyzes the effect of collapsed oil prices on new oil production projects, most of which require prices of well over $60 per barrel to be economical. Because the actual price of oil is so much lower than what is needed for oil producers to make money, many planned oil projects have been cancelled. The result is the removal of well over a million barrels per day of new production, and a decline in total world production from 85.8 million barrels per day in 2008 to 84.8 million barrels per day in 2010. The IEA has also stated that due to depletion of existing oilfields, the petroleum industry will have to spend well over half a trillion dollars each year just to meet future demand. This money is not likely to be spent in our present economic climate.

The CIBC report therefore predicts a supply shortfall of at least two million barrels per day by 2010, and a price spike that will begin in 2009 – indeed, within the next several months. By the end of 2010, the global price of oil will likely be back over $100 per barrel again. This will hinder, and may possibly derail, any attempt at a global economic recovery.

It appears, then, that we have fallen off the bumpy plateau. Or at least we don't have much longer to wait before we know for sure. All the words written on this blog and others concerning alternative systems and living lightly on the earth were not in vain. If anyone hasn't yet taken those words to heart, hopefully it's not too late.

Small-Scale Manufacturing - The Japanese Example, And A Few Last Comments

The issues now being faced by the members of our modern society are so serious that a proper discussion of these issues must include a healthy discussion of practical answers to practical problems. Mere theorizing or philosophizing won't do – although it certainly is entertaining sometimes. The search for practical examples has led me to study case histories of the use of small-scale manufacturing in various countries. Japan is one such country, and it was the subject of a report titled, The Japanese Experience In Technology, authored by Takeshi Hayashi of the United Nations University, and published in 1990. (The entire report can be found here: http://www.unu.edu/unupress/unupbooks/uu36je/uu36je00.htm#Contents.)

The Japanese Experience report shares a motivation and point of view typical of many reports written over the years on appropriate technology and small-scale industry deployment in the developing world. That point of view is the study of appropriate technology and small-scale industry in helping Third World nations achieve a higher level of “development,” i.e., similarity to modern First World society. In other words, the goal of such studies is to help devise strategies for “modernizing” these nations. Thus the citizens of these nations are judged according to how receptive they are to complex First World technology, how adaptible their indigenous small-scale technologies are to First World economic goals, and the ability of small-scale manufacturers in these countries to participate in and compete in a modern, interconnected, global economy. This First World bias is also seen in the way these studies judge indigenous small-scale enterprise according to the First World criterion of “efficiency” – maximum production with maximum profits and minimum cost per unit of production.

It is all but certain that we in the First World are facing a future of economic contraction, of simplification, of a return to a lower standard of living, due to economic collapse, resource shortages and environmental degradation. The studies mentioned above regarding small-scale industry might not therefore seem obviously useful in showing members of an advanced society the strategies and paths for preparing for the future we now face. Yet by reading between the lines and looking at the data in some unexpected ways, we can learn much.

First, the good news: According to the Japanese Experience report, small-scale industries assumed an increasingly prominent role in Japanese gross domestic product after the oil shocks of the 1970's. These oil shocks, along with increasing competition between producers, drove a number of large-scale factories out of business, and “...transformed the mass production system into a system producing high-quality goods in small quantities to meet market needs and to diversify risks.” Secondly, Japanese small-scale factories (with 20 or fewer workers) accounted for 87.3 percent of all Japanese factories in 1980. They employed 20.1 percent of all workers and contributed 12.6 percent of the total national output. Factories with fewer than 100 workers made up 98 percent of all Japanese factories, and employed 58 percent of all workers.

Small-scale industries in Japan also rapidly adopted modern urban industrial technology, aiding their competitiveness in international markets. Workers who mastered key components of an industrial process employed by a large manufacturer were in many cases able to go into business for themselves as subcontractors to their former employers, providing the materials or semi-finished goods produced by the process component they mastered. As the technical understanding of these workers increased and they were able to afford more complex technology, so the range of parts and base components that they could offer to larger manufacturers also increased.

In short, Japan had a long tradition of traditional, small-scale craft industry, which became the small-scale industrial foundation of Japan's 20^th Century modernization. Japanese small-scale manufacturing has been proven to be a most fitting means of providing desired goods to customers without overproduction and waste – a very important characteristic in an era like the one we are now facing, an era of scarce resources and high costs. Moreover, Japan retained its small-scale manufacturing tradition and culture until 1990 at the very least.

But now for the not-so-good news. Japan's culture of small-scale manufacturing has not been immune to the effects of globalism. The removal of trade barriers and the global spread of neoliberal economics has meant the outsourcing and shrinkage of Japan's manufacturing base. In much the same way that cities like Detroit are typical of American deindustrialization, Japanese cities that were manufacturing powerhouses are now shrinking, as noted in a paper titled, “City Shrinkage Issues In Japan” by Yasuyuki Fujii. (Source: http://www.mizuho-ir.co.jp/english/knowledge/shrinkage0405.html) And according to the 2009 online edition of the CIA World Factbook, only 27.9 percent of Japan's labor force works in industry at present.

Japan is thus losing a key component of self-sufficiency. As with other First World nations, the largest sector of the labor force is now the service sector. As the global economy continues to collapse, the value of the “service industry” will diminish in a very obvious way, and the demand for necessary, useful, “made-at-home” physical goods will rebound. Hopefully, the Japanese will have retained enough knowledge of their small-scale craft-industry tradition to revive that tradition when it becomes needed again.

And now for a few last comments on small-scale manufacturing and appropriate technology. I think it's fairly obvious to most people by now that the First World is facing a drastic change of lifestyle due to economic shrinkage and resource depletion. It's also becoming obvious to many that we can't “fix” the global economy so that it starts growing again, nor can we invent some technological fix that will enable us to enjoy lifestyles of continually increasing consumption. Small-scale industry and appropriate technology should be viewed as aids in adapting gracefully to a poorer future, and not as a means of escaping that future.

But there has been a great deal of talk in the blogosphere lately concerning the miniaturization of complex industrial processes. In an earlier post I mentioned the Fab@Home wiki (http://fabathome.org/), a site dedicated to development of desktop-sized computer-aided manufacturing devices (“fabs”) that can “print” 3-dimensional objects. These devices can be built from scratch for as little as $300, and there are those who say that such devices can be set up to reproduce themselves – even down to the level of reproducing the computer circuitry (CPU) that guides the workings of a fab. Alternatively, there are those (like this source: http://future.wikia.com/wiki/Desktop_Semiconductor_Foundry) who predict the development of desktop-sized semiconductor foundries as early as 2010. This is important, because of the major role that microelectronics plays in everyday life in our society. Those who talk of these things speak excitedly of how such devices will allow communities in First World cities to become resilient and self-reliant once again by manufacturing their own goods, and how this will aid us in our quest for an ever-rising standard of living, even as we face issues like declining resources.

I have a different view. I see an upcoming limit to human advancement in microelectronics, a limit dictated by declining energy supplies. For while it is true that final fabrication of highly complex, miniature integrated circuits can be shrunk to a process that fits on a desktop, it is also true that producing the blank silicon wafers that are the feedstock of such a fabrication still requires enormous amounts of energy. Silicon is derived from sand, which is silicon dioxide. The silicon and oxygen atoms in silicon dioxide are held together by very energetic bonds which require a lot of energy to break if one wants to obtain pure silicon. The first step therefore is to melt sand by heating to a temperature of over 3000 degrees F in the presence of carbon. Then the resulting silicon is refined further. Among the processes for this second-stage refining is the Siemens process, which requires heating silicon to a temperature of 2102 degrees F, although newer processes have been invented which run at lower temperature. Still, the refining of electronics-grade silicon is very energy-intensive.

If ready availability of complex microelectronic devices is an indicator of a society's level of technological advancement, I see a time in which our advancement will go into reverse. For as fossil-fuel availability declines, so will the energy available for manufacture of energy-intensive products such as ultrapure silicon. This means a decline of availability of devices that are controlled by complex microelectronics, such as...desktop fabs. Either such devices will become increasingly unavailable to the general public as time passes, or they will become rapidly more expensive, or both. A time may come in which only a select few have access to the latest and greatest computerized manufacturing technology. Those of us without access to the most advanced microelectronics will be forced to rely on our wits and our skills to make things of value.

But this is just my “two cents.” If any readers have alternative insights or arguments, feel free to comment.

Small Scale Manufacturing - Practical Resources

I had originally intended to discuss sources of practical knowledge in small-scale manufacturing at a later time. This week, however, I've been getting a lot of very good feedback from readers in the U.S. who are interested in small-scale manufacturing. Some of these people are even operating their own small-scale enterprises. So I thought I'd list the resources mentioned by these readers, in addition to listing a few other sources I have discovered.

First, there is the Open Source Machine site (http://opensourcemachine.org/), a source mentioned on another website by two posters who call themselves Fleam and Jokuhl. The Open Source Machine site is dedicated to providing potential manufacturers with small, easily-built manufacturing machines that can be made from recycled and reused parts. Plans for these machines are developed for free and published on the Web without copyright or royalty or intellectual property restrictions, so that anyone can use them. One of their projects is called the “MultiMachine,” described as “...a humanitarian, open-source machine tool project for developing countries.” The neat thing about the MultiMachine is that it provides many metalworking functions in one device that can easily be made from used vehicle engine parts. The Open Source Machine project site also has links to plans to build other machines, including plans to build an air compressor from scrap.

The Fab@Home wiki (http://fabathome.org/), contains information on buying or building desktop-sized“fabs” (computer-aided manufacturing devices) that can “print” 3-dimensional objects. Some of these fabs have been used for making watchbands, bicycle chainrings and sprockets, and bottles.

Then there is the Open Source Ecology Wiki (http://openfarmtech.org/), a site created by Marcin Jakubowski and others. Marcin has dedicated himself to advancing the field of open-source appropriate technology, and his wiki is a compilation of tools and knowledge useful to those who are trying to build safety nets to replace the present breaking economic arrangement. He also has a blog, http://openfarmtech.org/weblog/, and there is a podcast interview with him available at http://agroinnovations.com/component/option,com_mojo/Itemid,182/p,39/lang,es/.

There is also a site run by “Greg in MO,” who left a comment on my first post on this blog concerning small-scale manufacturing. He has a garage business which manufactures clothes drying racks and hand tools. He has some interesting insights on simplifying the manufacturing process so that it can be in essence, a “cottage industry.” His site is www.easydigging.com.

The Practical Action website (http://practicalaction.org) is hosted by the Practical Action group, “...a development charity with a difference,” which focuses first on development of local peoples in the Third World, then on matching appropriate technologies to their needs. They have a lot of technical information available for use, covering such topics as climate change adaptation, agriculture, construction, crop and food processing, manufacturing, information and communication, waste and recycling, and much more.

Village Earth (www.villageearth.org) is a “consortium for sustainable village-based development,” whose website also contains links to many appropriate technology resources, especially those related to small-scale industry. Payment is required to access some of their resources, however.

The AfriGadget site (www.afrigadget.com) is a blog which details the ways in which Africans are “...solving everyday problems with African ingenuity.” One post describes how an Ugandan woman made a homemade cell phone charger. Other features of this blog include its emphasis on “grassroots reporting” by Africans concerning African issues and African responses. These people are actually doing the things I detailed in an earlier post, “A Safety Net Of Alternative Systems – Citizen Media.” They also have posts on reuse of metals in the Kenyan ironworks industry, and the fabrication of hand tools.

Lastly, I would be remiss if I did not mention the work of bloggers Jeff Vail (www.jeffvail.net) and John Robb (http://globalguerrillas.typepad.com/), who examined the topic of small-scale manufacturing in great detail long before I did. (See http://www.jeffvail.net/2008/06/rhizome-platform-design.html by Jeff Vail and http://globalguerrillas.typepad.com/globalguerrillas/2008/09/resilient-com-1.html by John Robb.) Their particular focus is on the “fab” machines I mentioned above. My only concern with these machines and others is that new, ready-made machines of this type may be out of the price range of many Americans, who would be forced to build such machines from scrap and used parts if they wanted to manufacture things as these machines do – as 3-dimensional “prints”. I think, however, that I may have a solution to that concern, as follows:

There are plenty of old computers that are not being used anymore because constant “innovations” and “enhancements” to the proprietary products made by major commercial software vendors requires constant changes to the hardware people use. These “enhancements” rapidly render older machines obsolete. However, these old computers can be put back to use for a wide range of applications, if they are run using a Linux or open-source Unix operating system. They can also be programmed with open-source software to function as the controllers in a computer-aided manufacturing process. There are also old appliances being discarded even though they have perfectly good single-phase motors. The relays needed to operate such motors could be scavenged from old relay panels used with legacy programmable logic controllers that are replaced with new models in industrial plants. An enterprising tinker with a knack in computer programming and systems integration could make his own “fab” from an old computer and the motors from such things as a refrigerator, a house fan, a blow-dryer, etc. As long as the parts made by such a fab were not critical to life and limb (no cardiac stents or jet aircraft parts, for instance), the things made by such a fab would probably be perfectly adequate.

Of course, there would be the need for machine interlocks and kill switches to make the fab safe. This would not only be to meet codes and OSHA requirements, but to prevent the very real possibility of losing body parts in the works of the fab. An understanding of good machine safeguarding principles would therefore be essential. But it might be possible for someone to construct their own homemade fab for less than $1000.

Oil - The Forgotten Star Of The Show

This blog began with oil – its role in the global economy and social order, and the implications of an impending peak and subsequent decline in worldwide oil production. However, the effects of globally constrained oil supplies have upstaged Peak Oil itself in the public consciousness of the First World. Our ongoing, accelerating economic collapse is certainly not boring, is it?

Yet Peak Oil hasn't gone away, and there is new evidence that the world is past peak. For instance, according to the Barents Observer, Russian oil production decreased last year for the first time in 10 years, suggesting that Russia has indeed passed its own peak production. Russia has recently become the world's foremost producer of oil, passing even Saudi Arabia. The reality that Russia is past peak means that there are only three major nations who are supposedly still able to increase production: Saudi Arabia, Kuwait and Iraq. It is a well-known fact that these three nations vastly inflated their reserves estimates during the 1980's without providing any proof for their inflated reserve figures. Therefore, they may in fact be unable to raise their production of oil. Also, Merrill Lynch recently issued a statement that in their estimation, non-OPEC production may have already peaked. (Sources: http://www.barentsobserver.com/russian-oil-production-down.4542842-16178.html, http://www.marketrap.com/article/view_article/9147/peak-oil-production-in-russia-suggests-worldwide-supplies-on-the-brink, http://www.forbes.com/feeds/afx/2009/02/03/afx6002345.html)

Against this backdrop, some members of the U.S. Congress are doing some very strange things. For instance, the Senate killed a budget amendment to the Obama stimulus that would have increased general transportation spending by $25 billion and mass transit spending by $5 billion. In its place, an amendment will be introduced by Senators Barbara Boxer and James Inhofe to give $50 billion to highways alone. Then there's the Senate approval of a budget amendment introduced by Democratic Senator Barbara Mikulski that would allow consumers who buy new cars to get a tax rebate on their auto loans. (Source: http://thetransportpolitic.wordpress.com/2009/02/03/disaster-in-the-senate/) This is very strange – and very stupid. Our government is making some extremely short-sighted choices in order to prop up an unsustainable, collapsing system for just a little longer.

There is one other item of rather bizarre news. Fortune Magazine recently published a short piece titled, “A Recession of Biblical Proportions,” in which the writer asserted that present and recent consumer behavior is running contrary to the Biblical pattern seen in Genesis, when Egypt enjoyed seven years of plenty, saving during those years, then endured seven years of famine in which the nation lived off its savings. (The article is here: http://money.cnn.com/2009/02/02/news/economy/colvin_depression.fortune/index.htm?postversion=2009020210) The article is really a very thinly-disguised plea to consumers to go out and start spending again, and it ends with the following warning: “Whatever happens, don't expect miracles. Spending and saving behavior evolves slowly, and our current mess is in some ways the culmination of a long journey. We may not suddenly start behaving with biblical wisdom. But at least let's try not to forget how bad things can be when we get spending and saving backward.”

Now I am a Christian, and I have read the Bible a number of times, and I can tell you that I see nothing un-Biblical about the behavior of most American consumers who have stopped spending because their backs are against the wall, because those who sold them things did so in order to rob and enslave them, because they are beginning to see the evils of consumer culture, and because they are discovering that they really don't need all the mass-produced junk that's being pushed on them by the overlords of our global economy. But it is somewhat amusing that the writers of Fortune Magazine (and the masters who own them) are trying to use the Bible to get me to go out and spend money that would be better used in helping me adapt to a breaking system.

I'd like to quote a few passages from the Good Book to the writers and editors at Fortune: “For the love of money is a root of all kinds of evil,” (1 Timothy 6:10); “Again I tell you, it is easier for a camel to go through a needle's eye than for a rich man to enter into the Kingdom of God,” (Matthew 19:24); and of course, the passage in Luke 16 about Lazarus and the rich man, which I will leave for the writers at Fortune to read for themselves. One day they will find out just how flammable their money is.