It’s a Depression, Not a Recession

SUBHEAD: Boondoggle stimulus plans are not a panacea.

By Bill Bonner on 05 February 2009 in The Daily Reckoning

Today, dear reader, we’re going to let you in on a big secret.

Pssst…we’re in a depression, not a recession.

As we explained yesterday, economists have no sure way of separating the two. But they are profoundly different. In the few words that follow, we’ll explain why…and why this one deserves the “D” and not the “R.”

And since we always look on the bright side, here at The Daily Reckoning, we’ll also explain why this worst of times for most people can be the best of times for you.

But first, we turn to the news. We’ll see what a depression looks like – just from reading the headlines.

image above: Depressing Depression Era billboard from http://www.changetowin.org/connect/2008/12/in_case_you_needed_confirmatio.html

The Dow fell 121 points yesterday. That leaves only about 4,000 or 5,000 more to go…before the index reaches its depression bottom between 3,000 and 5,000. That could take a long time…depressions always take time. It might not happen before 2010…or even before 2020.

Oil held steady at $40. Oil seems to be stuck around the $40 level. The dollar/euro exchange rate seems stuck too – in the $1.28-$1.30/euro range. So too with gold – at about $900. Gold gained $9 yesterday…bringing it back over $900.

Credit card delinquencies are at a record high.

The Chinese are now buying more automobiles than Americans.

Disney profits fell 32% in the first quarter (Disney needs to get on board with the Gregorian calendar…why is it reporting 1Q results now?).

Panasonic reported a loss of $4.2 billion; it said it was cutting 15,000 jobs.

In the face of this depressing news, President Obama has said that if Congress doesn’t get off its duff and pass his stimulus plans the consequences could be “catastrophic.”

Naturally, the Democrats are mostly behind their main man. But the Republicans have ideas of their own. Instead of cutting Obama’s $880 billion boondoggle program, they’re adding more…such as $6.5 billion for medical research. They’ve added on some tax cuts too…bringing the total plan to nearly $1 trillion, according to this morning’s report.

What is amazing is not that both political parties favor boondoggles, they always have, but that anyone thinks that throwing money around like this will reflate the bubble economy. But that’s just what makes our job so entertaining – everyone thinks he knows what he is talking about…and no one has a clue.

At the foundation of their faith in the Obama stimulus plan…or any of the others for that matter…is a simpleton’s insight: that if private citizens stop spending government should take up the slack. But if it were that easy, there would never be any downturns…because politicians are all too eager to spend money, all they need is an excuse.

The typical recession is nothing more than the economy taking a little breather after a brisk walk. A depression, on the other hand, occurs after a long, uphill sprint – when the economy clutches its chest and falls down dead.

Even in a recession, the meddlers spring into action. Interest rates are lowered…government spending is increased (usually too late to make any difference) and the economy resumes its perambulation.

The policy makers take on a depression as though it were just a particularly bad recession. They cut rates further…and spend more money. But it has no effect – except to retard the necessary adjustments.

A depression is not merely a pause…it is the end. Unless the meddlers can work miracles – such as raising the dead – they will just make things worse. Because, while they are trying to revive a corpse, they are standing in the way of change.

Recessions are a natural feature of the inventory cycle. The economy gets a little over-stocked…and has to clear the shelves. Prices are cut. A few people are laid off. And then, after a few months, everyone is back in business… It’s “laissez les bons temps roulez,” as they say in New Orleans.

Depressions are a natural feature of a much bigger cycle. A part of capitalism that people love to talk about when the going is good…but despise when it turns against them. We’re talking about what Schumpeter describes as “creative destruction.” Everyone loved “creative destruction” in the late ’90s – when they thought it added to their balance sheets. Now, they beg government to save them from it.

What we are witnessing in the economy is creative destruction at work. And what we are witnessing in politics is a bunch of numbskulls trying to stop it.

What’s being destroyed? Trillions of dollars’ worth of asset values, of course. Millions of jobs. Hundreds of thousands of businesses.

In a recession, the basic plan or formula for the economy is still valid. The economy just needs a little time…and maybe a little monetary boost…before it continues growing. Typically, inventories are sold down…so a new burst of production can begin.

But in a depression, the problems are structural.

One way of understanding this is just to look at balance sheets. Whether you are a business or a family, you can only afford so much debt. When you get too much, you have stop and pay it down. And when it becomes so great you can’t pay if off – because you don’t have enough income – you have to declare bankruptcy. A depression is when a whole economy declares bankruptcy…or should. Because it can’t pay its debts. Businesses, for example, have been built for a level of demand that no longer exists.

It is not a question of waiting a few months. By the time consumers are ready to buy again, the whole economy will have moved on. Imagine, for example, a guy who built a nationwide chain of stores just to sell iPods to teenagers. The business may have been a great success – for a while. And he took out huge loans so he could expand…and take advantage of the demand.

But then comes a depression. He says to himself: ‘I’ll just get some more financing…and wait it out.’ But who’s going to lend to him? By the time the kids begin buying again, iPods will be like vinyl LPs. His business is history. His lenders have lost money. The loans should be written off and the business should be destroyed, not mummified and preserved.

A depression is when the whole economy changes its business plan, in other words. And that takes time…and creative destruction.

How much time? Well, in the United States alone there is about $6 trillion too much private debt…$1 trillion too much output capacity…and millions of “excess” workers. How long will it take to retrain, retool, and re-absorb these excesses?

We don’t know. The last depression took about 20 years…and a major war (talk about creative destruction!) Then, the United States was making the structural shift from a Japan-like capital investment-led economy…to a post-WWII consumer-led economy.

In Japan itself, its post-WWII capital investment-led boom hit a wall of creative destruction in 1990. Now, 19 years have gone by…and it is still adjusting to the new world economy.

All we know so far is that this depression has wiped out more than $30 trillion of dollars’ worth of investors’ capital. We suspect it will wipe out another $30 trillion worth before its creative destruction is over.

Our guess is that it will also destroy the U.S. consumer-economy model…and the dollar-based world monetary system. That’s the destructive part. For the creative part…and how you can get ahead during a depression…stay tuned…

A “New” Energy Path

SUBHEAD: The revolution of our post-petroleum future.

By Jan Lundberg on 06 February 2009 in Culture Change

The revolution just about to begin in earnest is not one that people are familiar with. Previous revolutions had the effect, unintended or not, of perpetuating civilization. This revolution will be about saying goodbye to civilization as we know it. If this does not sound very optimistic, consider that our species will be lucky to survive this century.

Strife will soon boil over as issues of inequity and greed, and painful shortages, reflect desperation over food and water. But the direction of history has changed, as expansion has reached its end. Goals will no longer be cornucopian or industrial, but rather to overcome deprivation and recover from the culling of the petroleum-fed population. Regardless of technological efficiency improvements that would have staved off a mor
e messy than necessary collapse, we are faced with a severe return to simplicity. The Agricultural Revolution and the Industrial Revolution have played themselves out.

image above: A sail boat and a bicycle are kinds of "alternative" technology for the near future

How can we be arriving at such an historic condition when we’re surrounded by technology and other trappings of modern progress and abundance? The answer is energy: the cheap bonanza is gone, while our rusting infrastructure is hard-wired for petroleum. So when the financial collapse that followed record oil prices started taking its toll, and lay-offs mount on an unprecedentedly massive scale, the undoing of economic growth can only continue, accelerate and solidify.

What does "a 'new' energy path for our times" mean? It not only means rejecting the already failing fossil-fueled, nuclear-powered approach that tried to defy nature; a 'new' energy path also means we get realistic over the alternative, renewable energy systems that are supposedly so promising.

At this point the financial ability to pull off massive projects and employ people as before has waned greatly. Every day the news on the economy shows it's winding down or collapsing. When the cargo ships stop altogether, it’s all over.

Meanwhile, the average driver on the road thinks he or she is lucky to have a car. That’s the problem. Still the price of fuel or of cars is of more concern than what they do to our world.

Another perfect expression of "the problem" is that overpopulation is “off the table.” But for far more people, it was far more important for impeaching Geo. W. Bush to not be “off the table.” How many of these activists contemplated how "small is beautiful"?

U.S. society and the modern world are at both a watershed moment and teetering over a precipice. As the economic growth machine grinds to a halt, and we glimpse that life is going to be very different henceforth, there are choices to make. The status quo intends to keep up the same discredited approach, and the elite wants above all to maintain privileges and control. But their success has little chance. It will be interesting how change-resistant they will be, even as order fails and we all must pursue new survival strategies.

More critical than any of the foregoing is the ecological basis of everything -- obviously deteriorating quickly. So far the economy's failure is not seen as a signal to start respecting nature as our key to survival. The excuses are many. Some say, "people will always want cars." Or, "It's going to be coal or nuclear power." Because of these ingrained assumptions and the big money behind them, the rejection of "hard path energy" (Friends of the Earth initiative of the 1980s) is seen as Utopian.

So a compromise has been underway for a few decades, based on the "soft path energy" (ibid). To compete with the big boys, and leave behind the anarchistic/hippie roots of back-to-the-land, "appropriate tech" and the Whole Earth Catalog, major-scale renewable energy systems have been developed and hyped. But they cannot replace what cheap oil accomplished, nor can they step in, because of energy limitations and the scale required to substitute significantly to pull us out of petrocollapse.

The suppressed reality is that we will all be adopting the small-scale, bioregional or hippie systems for local needs. There's little "big money" to be made in this approach, and little corporate news-media interest, but what if this is the future? Take the example of Cuba, which went through petrocollapse in the early 1990s. They had to go small-scale organic in farming, take to the bicycle mucho, and put in small-scale solar power installations. In other words, the overbuilt industrial world is about to join the "Third World." USA, join the human race.

Resisting the inevitable
This sounds reasonable or inevitable, given the economy and political power structure we are used to:

[Energy Secretary] Chu made clear that he sees public education as a key part of the administration's strategy to fight global warming -- along with billions of dollars for alternative energy research and infrastructure, a national standard for electricity from renewable sources and cap-and-trade legislation to limit greenhouse gas emissions. [Feb. 4, 2009, Associated Press]

But he's way off on what's feasible. Most people tied to the dominant paradigm can't picture simplicity or collapse -- although Chu seems to warn of the latter when he admitted in the same interview the threat of climate disaster: "we’re looking at a scenario where there’s no more agriculture in California”.

With all the evidence that's in, it is perplexing that fundamental change is not being pursued by more than one in a thousand modern people. Several in a thousand are concerned, but are perplexed that they can't have a giant green economy.

The New York Times headlined this on Feb. 4, 2009: "Renewable energy hits credit wall" Subheadline: "Economy: Sales of solar panels and wind turbines fall without access to capital". Another news story proclaimed 2008 was the top all-time year for renewable energy investment worldwide. Too little, too late.

This is what petrocollapse looks like. We are seeing mostly unexpected ricochets from the high oil prices of recent years that peaked last summer.

The "new" energy path
Apart from financing, the feasibility of energy systems must conform to common sense: decentralized, simple systems that are not based on petroleum/petrochemical processes/parts/delivery/replacement.

Additionally, the question must be asked, "What do we need the energy for?" If it is for continued waste, whereby the U.S. uses a quarter of the world's energy even though we are 5% of the population, then there's really no justifiable need. Running multiple machines and gadgets per family is a function of our lack of cohesion at the family and societal level. Catering to continued overconsumption is folly.

No doubt, we need some energy. So, what are the reasonable forms and systems to take us from this house-of-cards petro-economy to a sustainable culture? The answer is along these graceful lines: bicycles and sailboats. They can be fancy, energy-intensive products with a high price tag, or they can be simple and foolproof. The wind is free with a sail, but not with a high-tech wind turbine. Bikes can be salvaged and restored for the foreseeable future. One can hook up carts and trailers to the bikes. We moved our entire Auto-Free Times office across Arcata in 2000 with a few bike carts in one trip thanks to the pedal power of a few stalwart volunteers, a sight I'll never forget.

At a tense hearing last week at Portland, Oregon's city hall on the matter of a proposed 12-lane bridge over the Columbia River, a pro-engineering type walked into the unexpected. When he asked what future generations would do if the bridge is not built, the crowd on the left side of the room boomed "Walk!"

The main energy we need is from food. But the food growing and delivery system is still terribly petroleum oriented, despite clear indications of oil's peaking in global extraction. Organic farming is not necessarily the answer, as it may involve stripping the soil instead of building it, if chicken manure, for example is trucked in and there's no attempt at mulching or composting on site. Permaculture as well as cooperatives and tribes will tackle the food question.

Energy for moving machines or powering do-dads will be quite secondary. Commuting and computing will be history, as they are energy drains and do not contribute directly to the community. Besides food, we will have little to concern ourselves as to energy. Transportation? With alcohol fuels and hydrogen revealed as a net waste, we have our feet, bicycles, boats, horses -- and little else guaranteed for the post-petroleum future.

* * * * *
Stephen Chu on climate change: “Wake up,” America, “we’re looking at a scenario where there’s no more agriculture in California”
climateprogress.org

Fast Train Revisited

SUBHEAD: What’s a Doomer Chick to Do?

image above: Detail of comic book cover featuring dominatrix from www.comicbox.com

By Sharon Astyk on 4 February 2009 in Casaubon's Book

Oh you’ve been on a fast train
And its going off the rails.
And you can’t come back, can’t come back again.
And you start breaking down, in the pouring rain
Oh, you’ve been on a fast train.
….Got to go on the land.
Stuck in no-man’s land.
Ain’t nobody on your way back.
Ain’t nobody going to lend you a helping hand.
And you start breaking down
And you falling to the sound
You are hearing a fast train.
- Van Morrison, sung by the incomparable Solomon Burke

Despite the fact that there are plenty of people out there who view me as wildly apocalyptic, I don’t actually consider myself a doomer. My own feeling is that while radical restructuring awaits us, our future probably won’t look much like _The Road_. I have argued that what we face due to peak energy, climate change and our financial crisis can best be described as
“ordinary human poverty” - and we can do much to mediate our experience, that we can experience either an ordinary, survivable poverty or one that becomes pathological, based on our own choices.



On the other hand, compared to the mainstream culture, which tells us endlessly that things will stay the same or get better always, I am, of course, your friendly neighborhood Apocalyptic Dominatrix of Doom. That’s me, cracking the whip over my readers to get their gardens going, food storage in order, learn to darn socks and fix their own roofs, etc… Carolyn Baker was kind enough to mention me as a notable Dystopian chick in her well deserved rebuke to the New Yorker. So even though I often spend time observing “well, I don’t really think that we’re literally going to see TEOTWAWKI (The End Of The World As We Know It”). I suppose I qualify as one of Cassandra’s descendents.

A while back, I wrote my doomiest post to date, when I sat down to compose a section of _A Nation of Farmers_ that described the changes in food and energy issues as of last April. I was so shocked at what the aggregate shift in our reality looked like put down on paper that I posted it as “
We regret to inform you…”and I argued that we are, in fact, in the midst of a fast crash of our society. I wrote then,

“When climate change and peak oil thinkers run out of other things to worry about, there’s always the endless, inevitable debates about whether we are facing a “fast crash” or a “slow grind.” And I admit, I’m worried about my fellow environmentalists - because I think they are about to lose their favorite distraction. When no one was looking, we got an answer. Fast crash wins. And we’re in it now.

Wait a minute, you argue - that’s not right. If we were in a fast crash we’d be well on our way to living in a Kunstler novel. But we’ve still got cars, we’ve got food, things are slowing down, but at worst this looks like a slow grind - but the crazy lady at the blog is saying fast crash?!?!?

Before you argue with me (and you are both welcome and encouraged to), I’d like to post something a bit out of my usual style - it is simply a description of what has happened with food and energy in the last year - that’s all it is. Then tell me what you think - because it wasn’t until I began to write this introduction to the present food situation that I suddenly was struck by the fact that even a fast crash doesn’t always look fast when you live it - new normals arise and it turns out we assimilate faster than we panic.

So here we are - the “We regret to inform you that what you have imagined to be “civilization” is now falling apart” post. See if it strikes you the way it struck me.”

Although the major issues have changed somewhat - the collapse in energy prices has meant that now people can’t pay for heat because they don’t have a job, rather than because of the high price of energy, and the economic crisis has mostly numbed us to the growth of hunger in the poor world - I don’t see anything to suggest that we are not still in a rapidly accellerating crisis. The only thing is that even at my most apocalyptic, I would never have guessed how fast - and I think that that’s probably true of most “doomers.”

But I’m starting to feel like I ought to give back the quirt, the cat o’nine tails and that funky leather corset personally bestowed upon me by Richard Heinberg and Pat Murphy when I was inducted into the Ancient Order of Apocalyptic Prophets (you should have seen what they were wearing - I’m sworn to secrecy, but it was very fetching!) You see, I’m starting to feel I can’t compete with reality - any actual attention to events as they unfold points up the fact that my own doomiest imaginings are being wildly exceeded.

Let’s see - California is broke, functionally insolvent, and has stopped paying for just about everything, including its state police. Remember how often they trumpted that they were the 6th largest economy in the world - well, that’s kinda like saying the UK is insolvent…oh, and that actually might be not so far from the truth too, since they just had to nationalize their banking system. We’ve lost at least 300,000 jobs in two weeks. The New York Times may be out of business by spring. While neither rain nor sleet nor hail will keep the postal service from its appointed rounds, money probably will, and they are talking about cutting out Saturday deliveries. Homelessness and hunger are rapidly on the rise, as are suicide and murder suicide.

There’s rioting in Russia, China, Greece, and massive worker demonstrations in France and Britain. Australia is seeing record high temperatures, while many of the rest of us struggle with record lows. California’s drought may be the worst in a century. And the already hungry are among the deepest sufferers of the food crisis. The New York Times, Fortune Magazine, Bloomberg - they are all starting to use words like “Biblical proportions” “Deep Depression” “Apocalypse.” It is getting hard to compete with the mainstream doomers.

We’ve been “fixing” the problem - which is a big part of the problem - think of the word “fix” here as in “the fix is in.” We’ve just spent 8 trillion dollars bailing out the banks - more than all the wars in US history, the Louisiana purchase and the space program combined. And what did we get for it? Bank of America and Citi are still teetering, the jobs are still being flushed daily. The estimate is half a million a month - every month.

And people aren’t really very angry yet. They should be - think about what 8 trilliion dollars could actually have bought us, had anyone cared as much about the people as they do about the banks, and about the wealth of the fortunate. At some point people will realize that it isn’t going to work - and their anger will be frightening - and just. The New Hampshire state legislature is currently debating legislation that would assert that if the US implements martial law or abrogates the Constitution, it will effectively dissolve the Union. While one wonders where they were the last eight years, this is being taken quite seriously, and it would have been unthinkable a decade ago.

Eight trillion could have paid for free health care for every American, cradle to grave for a century. Eight trillion was sufficient to cover the cost of almost all the mortgage debt - every American could have been given their house and the “foreclosure crisis” ended instantly. Eight trillion was enough to build renewable energy infrastructure that could have softened the crisis, to reinsulate our houses, to provide basic food and health care to the world’s poor. The same eight trillion we were told we didn’t have when it was needed by those who wanted educations, basic medical care, decent shelter, a home, hope, a decent life, we had a plenty for the banks and the wealthiest people in the world.

A number of energy and environmental advocates don’t seem to grasp that the 8 trillion figure - and the monies spent by other nations - aren’t proof that we can build a renewable infrastructure or address peak oil if we really want to - instead, they are what we are doing *instead.* Yes, nations can print money, but in order to inflate our currency, we’d have to disentangle ourselves quite violently from the other nations with which we are economically intertwined, and that would have its price too. That is, our ability to keep bailing is limited - and the 8 trillion now buried in bank vaults and flushed down the toilet is money we don’t have for future adaptations.

Think about it - we’re debating 3/4 of a trillion dollars for all the American people combined (and some of that will also make its ways into the coffers of the bank) - while we’ve already spent almost 9 times that much on the banks. 300 million Americans get 1/8 or less what the banks get. What does that say about us? And what does it say about the ability and willingness to mobilize funds for things that actually protect human lives?

So what’s a doomer chick to do but throw in the towel and her spiked mitts and admit she’s beat? I can’t out-doom the Wall Street Journal - Wall Street invented our doom, and who better to describe it. The old button ”I eat stranger things than this with my breakfast cereal” is increasingly true - me and my gardens and my ordinary human poverty are just plain dull.

Don’t worry, I’m not going to stop writing. But like Dmitry Orlov (who did threaten to stop writing, which would have been a tragedy), I’m getting out of the apocalyptic prophetess of doom job. Like Orlov, I’m now an observer - hardly impartial, but there’s no point predicting the future when we’re living it, and when the song of the apocalypse becomes the universal chorus.

Adapting In Place

SUBHEAD: Whether, Why and Wherefore Ought Thou?

By Sharon Astyk on 4 February 2009 in The Oil Drum

The first question to ask is whether we should take in-place Adaptation seriously at all. Shouldn’t we, ideally, try and choose the best possible place to deal with the coming crisis? Some analysts suggest we will have to have vast population migrations out of suburbia, say, to more densely packed and walkable cities, while others propose re-ruralization. My suspicion is that both of these will probably occur to some degree – but that the progression will be intermittent, not very well organized. And plenty of people will stay in place, either in their homes and apartments, or will settle in property known to them, owned or rented by family or close friends.


image above: Oil painting by Anatoly Perevysk - "Early Snow" 1995 from http://everleaf.com/chasewinfield/perevyshko_anatoly.htm

Why will they stay? Well, for millions of people who own a home, but aren’t in immediate danger of foreclosure, the option of selling, even if they are not “underwater” is problematic – with home sales at historic lows, most of us will be staying put, if we don’t lose or abandon our properties. They can’t afford to change jobs, because they will lose seniority and potentially get the axe. They can’t afford the additional costs of moving, buying a new property or paying first, last and security.

And if they do move? Some of us will migrate, but a lot of us have compelling reasons to live where we do – community, culture, and family. What most of us will probably do in dire circumstances is simply consolidate resources with people we can trust – we’ll take in boarders or move in with family or friends. In tough times, we are likely to need family and community more – thus staying close to elderly parents or grandparents who can help with childcare while parents look for work becomes more urgent.

Some of us may also decide where we are is the right place – it isn’t just a matter of not being able to move, but of believing that we are best in places we know. The time for the radical changes required by picking up and moving and starting over may have been a few years ago. More familiar projects may be wiser and better for many of us.

Another force pushing us to stay put, as I wrote in my book _Depletion and Abundance: Life on the New Home Front_, one of the most powerful strategies for mitigation is likely to be a move into the informal economy. Teodor Shanin, founder of Peasant Economics has observed that the formal economy (the one most but not all Americans operate in) makes use of only ¼ of all the world’s workers. Most economic activity takes place in the informal economy, and the informal economy generally expands in response to contraction by the formal economy. In an essay in “New Scientist” Shanin writes,

“The concept emerged in Africa 25 years ago. Researchers began to notice that there was no economic explanation for how the majority of the population survived. They didn’t own land. They didn’t seem to have any assets. According to conventional economics, they should have died of hunger long ago, but they survived. To understand this, researchers looked at how these people actually lived, rather than at economic models. They found that their way of life was completely the opposite of how a human being in industrial society survives. They didn’t have a job, pension, steady place to work or regular flow of income. Families held a range of occupations from farming and selling in the market to doing odd jobs or handicrafts. Their aim was survival rather than maximization of profit. Rather than earn wages, labor was used within family.”

Similar informal economies have emerged in undergoing collapse or economic crisis in Russia, Argentina, and elsewhere, and there is really no reason to believe that the informal economy – which includes domestic labor, cottage industry, illegal activity, under the table businesses, and family economics will not expand here. These economic activities generally make use of family, local, household resources and needs – the soil your home sits on, the wood on your woodlot, providing services to neighbors, making use of household space to operate a business. Where homes have been a major economic drain, they have the potential, for those not over-leveraged, to become a source of income.

It seems likely then that some people whose homes have been or can be made valuable to them – by improving soil, the starting of cottage industries, strong social, familial and community ties, and local economic initiatives will have strong incentives to stay in place. We may see the common pattern of Global South employment in which some family members are sent where formal jobs are available to work, while most of the family remains together. With more people per household, mortgage and property costs may become manageable, while the benefits of family and community are increased by our lack of fossil fuels.

Triaging Your Situation
This does not mean that everyone can or should stay in place. Those who bought homes with ARMs, or at the peak of the market, those already in financial trouble, or without community and family ties may wish or need to relocate. But I still anticipate that at least in the short term, a large number of people all over the world will respond to the present crisis by remaining in their present homes or in a place they have existing ties.

So it is worth asking - what are the first steps if you’ve decided to remain your home, with all its imperfections and disadvantages (and its perfections and advantages – remember, there is no perfect place)? Your goal is to be able to handle what is thrown at you, crises economic, energetic, ecological or political – or all of the above. And the first step, as always, is triage – setting priorities.

First Steps
We all need to get ready to deal with the kind of short term crisis that affects almost everyone sooner or later. Given the fragility of our systems, more and more of these disruptions are likely. Thus, our first project is a medium range systems problem - something that can be caused by ice storms, blizzards, hurricanes, tornadoes, flooding, geopolitical crisis, blackout… you name it. We need to be ready to get along for a few weeks to a month in a very messed up short term situation. This is useful even if what we face is a very messed up long term situation.

That means moving first to get basic needs met. Thus, we concentrate on first tier solutions. The qualities that these first tier solutions must have are these

1. They keep you alive and healthy

2. They are simple, accessible and not too expensive – since everyone needs these

You need a reserve of food, and a way to cook it without power, lots of warm clothing and blankets if cold is a potential problem, and sufficient water and ways to keep cool if heat is the issue. You need stored water and a backup source of water. You will want some basic lighting and a way to manage toileting and hygiene issues, clean bodies and clothes. You need a way to keep aware of events and communicate with family and community.

Other than the food, medications and water, the emergency measures could be quite cheap, because they don’t have to be comfortable and pleasant - for a few weeks, you can winter camp in your house, for a few weeks you can pee in a bucket, for a few weeks you can do laundry infrequently in another plastic bucket, light your evening with your headlamp and rechargeable batteries, communicate with your neighbors by trekking out to knocked together neighborhood bulletin board. That is, you can be uncomfortable and/or inconvenienced for the short term, in most cases. That doesn’t mean all the short term solutions are unpleasant – in fact, sometimes you’ll be surprised by how minor the inconvenience is, but the most important thing is that you have a way of meeting those needs, not that it be the perfect method.

For those who can’t tolerate much discomfort or inconvenience, because of health problems, age, disability or simple intolerance, then you will need to move up a little in the list to the next steps, the long term solutions to these problems. That is, you may need solar panels, expensive equipment or a generator, which come with attendant costs. But for most of us, the first-tier inconvenient but survivable solutions get us part of the way there, and many of them could be used longer if we had no choice.

But we all know that short term isn’t everything. What happens if we can’t afford electricity or gas anymore? What happens if we’re suddenly in the Long Emergency, not the short one? The preparations you’ve made for a short term crisis will get old really fast - but most of them will still serve you. That is, you will not like lighting your house with only a headlamp and two flashlights, and you will not like going to bed when it gets dark in December in the north, but you can do it if you have no choice. Some of us may already have second tier solutions in place – we might have a wringer washer already and not need the plastic buckets. Still, I recommend that you have the equipment or ability to use these minimal backup solutions, if only so you can teach others in your community.

The Second Tier
The next level of preparations are partly about survival, but more about creating a life you can live with in the long term. If you have money, these are easy changes to make. If you don’t have money, it will take time, and saving and scavenging to manage these systems - and you may be stuck with the original, inexpensive backups at times. Only you can decide what you can afford, have time to do, and what portion of your resources you can devote to improving your comfort and giving you more time – but my own observation is that these accommodations increase rapidly in value in tough situations.

This is where you begin going step by step through the systems you depend on, figuring out what you can do to allow you to live decently and comfortably. Step by step, you start replacing, adding or converting to sustainable systems that will serve you in the absence of existing infrastructure. My own belief is that while renewable energy systems are an excellent supplemental second tier system, your primary systems should operate a technological level you are like to be able to support even in the worst-case scenarios you think likely.

That is, even someone with a solar system large enough to run their washing machine should have a bucket at a minimum, and might want a small pressure washer. Even someone with a generator for their well pump might want a manual pump on their well or rain cachement. Someone with a chainsaw still needs an axe and bucksaw. The reason for this is that things break, supply lines can be disrupted, replacement parts may not be available. Redundancy is healthy – and can be essential. And if you must choose between the solar panels and manual well pump, my own feeling is that you should prioritize a system you can manage, repair and fully understand, whichever that is.

For those without much money, it is much easier to convert permanently to the alternatives in many cases, than it is to maintain both “normal” and “backup” systems. That is, it is hard, if you are poor, to afford solar lanterns - unless, of course, you use them as a lighting source and save money on your electric bill. Sometimes if things seem too costly, the problem may be that you are imagining them as a backup, not a conversion to a new way of life. You may prefer the old way, but if you are serious enough about your concern for the future, converting early isn’t the end of the world – our family has made this choice a number of times, in fact.

Some of the choices are easy and cheap - turning your lawn into a landscape of edibles can be quite inexpensive, if you can get slips and starts and divisions from people and buy plants and seeds from your cooperative extension. Converting to a composting toilet is inexpensive and can save you a lot of money on your water bill. Switching to eating out of your food storage can save a lot on your food budget. Sometimes you can do things on the cheap if you have time – but if you have neither time nor money, things get difficult, so you need to prioritize.

The Order and Ethics of Things
There are two good ways to prioritize, and honestly it makes sense to do both simultaneously. Prioritize by urgency, and by availability. Generally, you should concentrate on the things that will matter to your happiness and comfort the most - for a family with two kids in diapers, this might be not having to do laundry in a bucket, for someone who is always cold, a good heat source. But don’t also forget (and this is a great chore to delegate to elderly relatives, friends who want to barter or teenagers) to keep an eye on craigslist, freecycle, garage sales and to talk about what you are trying to do with others, so you can take advantage of opportunities. Try and have a list of all the stuff you’d like to do, so that when that old handwasher or treadle sewing machine shows up, you can cross that off your priority list.

While you are finding comfortable ways to keep cool, refrigerate food, keep safe, go to the bathroom and the rest, we can also begin thinking about the long term sustainability and community implications of these projects. That is, if you are going to burn wood, you need to be planting trees and harvesting carefully. You are just as vulnerable to diseases caused by human waste disposal problems as your neighbors – even if you don’t contribute to them, you may get sick when you water supply is contaminated. So after you deal with your own water system, share your knowledge. Renewable and lasting systems are central. If your private solutions are likely to contribute to the long term problems, pick different solutions.

In peasant economics, we find that most wealth accumulated by families is passed down through generations. Thus, as Shanin observes, a bicycle for a family may be expected to last until the family’s father is too old to ride it and the daughter can take over. Land and property are passed down, and mostly stewarded – they are not disposed of lightly, because they imply an obligation to future generations who are not expected to have enough wealth to replace what we are careless with now. It would behoove most of us, as we make our adaptation plans, to ensure that our strategies serve not just our present, but our future – if our adaptations destroy future capacities to warm, feed, slake thirst, protect other people, perhaps we need to find new adaptation strategies.

Finally, you should practice. That doesn’t just mean trying the solar battery charger once, or making sure you know how to cook on your woodstove - try living with these systems routinely, and turning off the ones you’ve depended on up until now. Consider a test run, when you turn everything off in the winter for a week, or where you live only on your stored and garden food for a month - these tests will tell you really basic things you need to know, and show you the holes in your system while you still have a chance to plug them.

Jeffery Smith on GMOs

SUBHEAD: Genetically Engineered Foods: Statewide Tour with Jeffrey Smith
SOURCE: Maluia - WCMS maluia-wcms@hotmail.com

FREE EVENT:
Jeffrey Smith on how GMO's relate to sustainable agriculture and affect our food security.

WHEN:
All Kauai Events:
Begin at 6:30 pm: Gathering and Pupu's
Lecture at 7:00pm: Jeffery Smith


image above: Photo of Jeff Smith from announcement at www.hawaiihealthguide.com

WHERE:
Kauai Locations:
Hanalei:
Tuesday, February 10th at the Hanalei School Cafeteria

Lihue:
Wednesday, February 11th at Peace and Freedom Hall (aka War Memorial Convention Center)

Waimea: Thursday, February 12th at the Waimea Neighborhood Center

WHAT:
Jeffrey Smithwill share his perspective on how GMO's relate to sustainable agriculture and affect our food security. His books Seeds of Deception & Genetic Roulette are the two bestselling books on the health effects of GMO foods. As founder of Institute for Responsible Technology, he works internationally to educate why agricultural biotech companies should not be in control of our food supply and how the FDA is not keeping our food safe.

If you care about what you and your family eat and what's being grown on our agricultural land, don't miss him!

SPONSOR:
Proudly sponsored by Hawaii SEED

CONTACT:
For more information, please call GMO Free Kauai: 651-9603

Tropical Storm Warning

SUBHEAD: Hawaii is about to become the poster child for sustainability.

By Juan Wilson on 4 February 2008 juanwilson@mac.com

PRETENDING IT'S ALRIGHT
Here we are, at the midpoint of a long cold winter that marks the end of our old way of doing things. The old way had gotten awfully comfortable for many of us. But now we are suspended between what was and what will be.

Recent news reports indicate Americans are living in a peculiar state of denial. This winter many mall owners have been allowing lease holders to go without paying rent, in hopes that things will improve more quickly if their facilities don't look like ghost towns. Both the lessees and lessors know that this can't last long.

Many homeowners, underemployed and underwater, are now squatting in their own homes - while mortgage holders look the other way. The banks know that it would be worse to foreclose on them, and thus rack another loss onto their books. Barring a miracle, both parties know this frozen momentary situation will break up with the spring thaw.


image above: Tiki Gods" by Mark Bryan at http://www.artofmarkbryan.com/tiki_gods.html

UNDERLYING REALITY
Here in Hawaii our tourist economy is withering on the vine. High unemployment and huge debt will put the kibosh on jetting off for expensive family vacations in Las Vegas or Hawaii. Check this out...

Luxury casino operator Steve Wynn on 2/3/09 announced plans to cut hours, salaries, bonuses and 401(k) contributions for thousands of his Las Vegas employees in an effort to stave off layoffs. http://www.lvrj.com/business/38930834.html?numComments=26

Kauai occupancy was off 8.7 percentage points to 58.6 percent, while room rates shrunk 11 percent to $194 for the week ending 1/17/09. http://pacific.bizjournals.com/pacific/stories/2009/01/19/daily54.htm

Hawaiian Airlines says it plans to add a third flight between Honolulu and Las Vegas starting in February 2009... The new service will depart from Honolulu in the mornings and return the same evening. The airline says it added the flights in response to customer demand. http://www.mercurynews.com/breakingnews/ci_11238955

It is a strange moment in time. It reminds me of that moment at the top of the first and tallest crest of a roller coaster ride. Until now the ride has been a smooth, even climb to the top. Strapped into our seats, we know we have to come down again, and we can see some of the wild and twisty ride ahead. At the peak of that first crest there is a hesitation and silence as the butterflies gather in our stomachs. Then we become weightless as we drop into the abyss, praying that our coastercar will stay on the tracks.

It may be that our new administration in Washington will get a lot accomplished in a frenzy of effort to relieve pain and suffering in this transition. There will certainly be titanic attempts to get the economy growing green. Hawaii has been singled out as a place to see if such an economy might work. President Obama has an interest in Hawaii succeeding. However, the writing is on the wall. Any economy dependent on "growth" (whether smart or dumb) will end in the continued die-off of planet Earth. The old way is over, and we need to be planning on setting an example for a "Smart Contraction". In such an effort maybe Hawaii could be that poster-child.

CHANGING COURSE
As for those who rely on day trips from Honolulu to Las Vegas for fun and entertainment - you are in for a rude surprise. So are those who have relied on traditional modes of activism to move things in a progressive direction in Hawaii.

I suggest those who have toiled in endless planning commission meetings, legislative battles and county charter improvements efforts - you will find your efforts bearing little fruit as ever more frantic efforts to "jumpstart" the economy demand compromises on the environment and social justice.

Air conditioned conference rooms are not where the real battles will be fought. If you have to drive to where you do your "good work" consider the likelihood that its return on investment will diminish. The real struggle will be in your back yard, neighborhood and village street.

I'm sure if you are a regular reader of this blog, all this sounds familiar. But I think these things worth repeating. Here are some priorites.

• Start growing as much food as you can (flowerpot, garden or field). It requires at least a little work everyday.

• Work, barter, and share with the people who live closest to you. Offer food abundance, trade what you don't need for what they don't need, share tools, help out with projects.

• Find work in your village that is useful. At first it may be as a volunteer, but if it is really useful to the community, you may be paid for your effort. If you can afford it, get rid of your day job, if it requires a lot of driving. Re-adjust what it means to "afford it".

It is my opinion that a lot of efforts by government to regulate, control and micromanage our lives will fail. Building permits, medical marijuana licenses, and seat-belt fines will take a back seat to keeping tap water flowing and sewage out of our gutters. We will be much more on our own.Getting potable water and handling the waste-stream will be everybody's job.

We are going to see a revolution on the landscape as people move onto ag-land to grow food. This may not be be ideal, but it will happen out of necessity.

I would bet that by the end of this year Kukui Grove will not be the place everybody shops on Kauai. Note that on Monday the Macy's chain announced 7,000 job cuts. http://www.abcnews.go.com/Business/CEOProfiles/story?id=6787461&page=1

If you don't live within walking distance to a shopping village either build one or relocate. It's going to be a bumpy year.

Myth of the Efficient Car

SUBHEAD: Our car-centered civilization is going to hit the wall.

By Alec Dubro on 2 February 2009 in The Progressive

Let’s get something straight about green industry: in its basic form it means we all have to buy new stuff … lots of it. As an industrial policy that will create jobs and increase spending, it’s pretty sound. As an environmental policy, it’s largely a fraud.

Nowhere is it more disingenuous than the pursuit of the fuel-efficient car. In their effort to stave off collapse of their industry, auto executives have continually cited their efforts are building the high-efficiency cars of the future. The problem is, there are no cars of the future, and the looming catastrophe of global pollution, including climate change, will never be solved by building more cars – efficient or otherwise.


image above: GM's Chevy Volt in an earlier configuration http://www.thelightisgreen.com/2007/09/electric-car--2.html

We’d desperately like to believe that there is a way to preserve our car-centered civilization, while simultaneously placating the gods of atmospheric warming. Even the president-elect believes it, and Obama made fuel-efficient cars a central part of his energy policy. He promised a $7,000 tax credit to hybrid car buyers, aiming for a million plug-in hybrids, getting 150 mpg, by 2015. He wants to put an additional million completely plug-in vehicles by the same year. And he’s willing to federal funds up for research, or at least he was before we lost all our money.

Even on its face, this seems like a tepid response to climate change. At the moment there are upward of 250,000,000 registered vehicles in the United States – more than there are licensed drivers. Converting one percent or so of them to greater fuel efficiency is not likely to do very much in the time needed to act. Nevertheless, the hope is that introduction of a new generation of electric and semi-electric will eventually lead to a replacement of our entire fleet of gas-guzzlers. Maybe. But the bigger problem is that increasing fuel efficiency has never led to an overall reduction in pollutants. In fact, efficiency has always led to more production and consumption.

But there’s an even more profound problem with building more efficient cars. In 1865, English economist William Stanley Jevons discovered an efficiency paradox: the more efficient you make machines, the more energy they use. Why? Because the more efficient they are, the better they are, the cheaper they are and more people buy them, and the more they’ll use them. Now, that’s good for manufacturers and maybe good for consumers, but if the problem is energy consumption or pollution, it’s not good.

The so-called Jevons Paradox was resurrected in the 1980s by a variety of environmentalists and is occasionally referred to as the Khazoom-Brookes postulate or the more explicative rebound effect. It's been neatly summarized as, “those energy efficiency improvements that, on the broadest considerations, are economically justified at the microlevel lead to higher levels of energy consumption at the macro level.” Or, in short, you make money on each transaction and lose it in volume.

The rebound effect is not an immutable scientific law, but it’s a widely observed phenomenon and has held true in the most energy-intensive consumer activities. The most commonly cited example is in lighting. As the Encyclopedia of Earth puts it, “For instance, if a 18W compact fluorescent bulb replaces a 75W incandescent bulb, the energy saving should be 76%. However, it seldom is. Consumers, realizing that the lighting now costs less per hour to run, are often less concerned with switching it off; in fact, they may intentionally leave it on all night.” I know I have at times.

The same effect has occurred with cars. Automobiles have become more efficient over the years. Led by the Japanese, carmakers have increased the fuel to weight ration, decreased damaging vibration and vastly increased reliability. In the 1950s, a car that lived to drive 100,000 miles was a rarity; today they routinely last 150,000. The result? Increasing fuel consumption. And not just because more people in the developing world are buying cars, either. People everywhere are buying more of the better, cheaper more efficient cars and – here’s the problem – driving them more. And that was even so when gas peaked there at $8 a gallon in Europe.

The real problem is, though, cars don’t move people, cars move cars. The average car or light truck is two tons or so: 4000-plus pounds to move 200 pounds of people. OK, everybody out of the SUVs and F-150s and into a nice, green Prius. However, the curb weight of an unladen Prius is 2765 pounds, which means a ton and a half around to get you and a bag of groceries home. Not good.

Environmentalists like Amory Lovins of the Rocky Mountain Institute and green business advocate Paul Hawken have generated a lot of press with a proposed 100 mpg lightweight, plastic composite called the hypercar. But all the drawings of the hypercar very much resemble…a car. Tires, windows, bodywork, engine and drive train. Even if everything is paper-thin – something the public won’t easily warm to –you’re still driving five times body weight around.

Even if we were able to produce a 100 mpg, zero pollution vehicle, we’d still need to maintain the infrastructure of roads, bridges, and energy distribution. That means steel, concrete, asphalt and plastics. Just concrete production alone generates as much as 10 percent of all greenhouse gas. In 2007, the U.S. produced 95 million tons of cement by burning fossil fuels and, according to the EPA, is the third largest source of greenhouse gas pollution in the U.S. (Scientific America, August 7, 2008) The production of asphalt – a petroleum product – also creates carbon. As does the production of motor oil, tires, and on and on.

And there’s another intractable problem: the very thing that makes tires so useful – comfort, stability, adhesion – also produces immense rolling friction. In order for us to makes cars that are maneuverable and relatively safe, they have to grip the road, which takes buckets of energy to overcome. One reason trains are able to transport people using far less energy per passenger mile is that there are fewer wheels per person and steel wheels have much less rolling friction.

Without divine intervention – which seems to be the basis for most energy reduction schemes – there is simply no way to maintain both the atmosphere and personal transportation. Even if the population were frozen at its present level, even if economic growth stopped the sheer number of people wanting – and under the present regime, need – personal transportation makes any plan to reduce car pollution by increasing efficiency is futile. The personal automobile must be abandoned, and quickly.

It would be better to do this in a measured and humane way, easing both automobile workers and users into a post-car world. It needs a societal consensus, requiring major shifts of goals and expectations, and few of us will take these steps on our own. But this change will eventually happen to us whether we like it or not, perhaps in time to stave off climactic disaster.

There are already attempts at designing a post-car future. City planners have been pushing the “20-minute neighborhood,” where home, work, shopping and recreation are all within a 20 minute walk. Places like Portland, Oregon, are encouraging this kind of development with planning codes and tax breaks. These more compact, walkable neighborhoods would seem to point us in the right direction, but so far they’re extremely limited. Most people prefer car culture. And that includes Europe, and certainly Asia, as well. Unless the various governments enact explicit and enforceable sprawl restrictions, growth will trump any specific increases in efficiencies.

The one step we ought to take right now is to withdraw our support – financial, political and emotional – from the pursuit of an energy-efficient car. We'd have better luck creating a perpetual motion machine.