by Milo Clark
(Swans - February 14, 2005) As it is improbable that any one single event would plunge the nation and the world into financial ruin and social catastrophe, what might accumulate to bring about a similar result?
Following Gregory Bateson's admonitions to look for differences that make a difference and patterns that connect, we may find some clues. Add in Leopold Kohr's warning that every system has its limits and when those limits are exceeded, implosion follows.
From statistical perspectives, whenever any curve goes exponential, that is, sharply turns upward (given an X-Y presentation) and breaks trend, we should take notice. When more and more curves go exponential, patterns emerge and may connect.
Manmade disasters have historical characteristics. One of which is that causal factors tend to be ignored, downplayed or misunderstood except in hindsight. That simple pattern fits most past disasters and probably will fit coming disasters.
Let's take a simple cliché: "Any nail that stands up will be hammered down." This cliché is commonly applied in cultures which emphasize group over individual. In a broader sense, let's apply it to overall world conditions.
Presently, a small proportion of the world's people consume a very large proportion of world resources. Lots of nails sticking up, in other words. Broaden the definitions of resources beyond physical resources such as commodities into any number of intangibles such as bandwidth. World finance is now a pure function of bandwidth.
Move another step beyond water into other areas essential for human living such as air. The people who consume a large portion of physical resources also consume key essentials to maintenance of human living on the planet. In developed societies such as the once United States of America and Western Europe, water, for example, is changing character. Air is changing character. Shelter and food have changed character. These changes are shown in curves gone exponential.
Today, in the developed world, water once scooped from a freshly running stream is first run through expensive filtration and treatment facilities and comes in plastic bottles and has a money cost equal to or greater than petroleum-based fuels. Energy cost to product ratios have gone exponential.
Air once considered pure and pristine is increasingly befouled. Interior spaces once opened to the outside breezes are now closed. Expensive filtration, cooling and heating technologies consuming vast amounts of energies are found to have added its own contaminants to the air breathed by occupants. Those peoples left outside are little spared pollutants. All of which contributes to unintended consequences such as viral sharings.
Forests which once served to give balance to both water and air resources have and are disappearing at phenomenal rates to supply consumption by the few.
Oceans which once served to give balance to ecologies are being stripped of inhabitants who contributed to that balancing process as well as polluted beyond capacities to redress balances.
Nearly all statistical characteristics measurable which are related to ecologies have gone exponential. That statement is said in many ways by many heralds of doom and largely ignored by those given control. Those given or taking control share a common aversion, that is, paying attention to exponential curves.
Over in other areas of human activity, the many forms of organization adopted by humans to order their affairs are also showing patterns gone exponential. Government and governance become less and less responsive to what may be considered responsible guidelines for relevant action. The daily financial media such as The Wall Street Journal and The Financial Times record nearly endless examples of unresponsive government and heedless corporate governance. Yet, voters install governments and consumers consume corporate output unabated.
At macro levels, the bigger pictures, today's buzzword is "Globalization." Back in Adam Smith's time, the late 1700s, "globalization" was called "Mercantilism."
Mercantilism was an international trade mechanism within which raw materials were taken from far away places, brought to other places for processing and, then, as finished products returned to far away places where the peasants were allowed to buy them with cash they didn't have. Where the processing was done, the once peasants now factory workers were also allowed to buy manufactured products with cash they didn't have. Mercantilism depended on cash economies. Cash economies enslave people. Cash economies are unsustainable by definition.
To maintain the superficial efficiencies of mercantilism, empires were perfected. Being important to keep people living in areas from which raw materials were extracted from processing those raw materials at home, manufacturing there must be prohibited by force, if necessary. Seems like force was always necessary, though.
Mercantilism gradually took the form called "Triangular Trade." Slaves were brought to Caribbean islands to grow sugar cane at economical costs. Raw sugar was shipped to other places such as New England colonies and converted into rum, rum being a specialty product taking up less shipping space and commanding higher unit prices "back home." Rum was also useful back home in England to keep manufacturing workers docile, if drunk, therefore useful to maintaining tame workers. Tame workers at every juncture in mercantilism and globalization are critical to these systems of exploitation.
As skills to maintain the increasing technological systems of developed and developing societies became more sophisticated, systems to maintain tame workers also evolved. In spite of some points of friction requiring massacres of uppity workers, gradually newer modes of taming workers evolved. Credit is notable among such systems. People in debt to support their consumption are more manageable.
Credit systems such as now characterize and shape developed and developing societies function in ways similar to rum in earlier times. Rum, per se, has been ungraded into brands and expanded into drug trade. The drug trade, intriguingly, follows old mercantile patterns. Coca and poppies grown in fourth world are processed in third world for consumption in first and second worlds.
However, in developed and developing societies, another massive technological glitch gradually emerged which is antithetical to mercantilism/globalization. Prosperity nails stuck up higher and higher. System balances required that these nails be hammered down. Mercantilism/globalization provides the bludgeons appropriate to the task.
With barriers to trade reduced to minimums, technological advances flow freely. Smarts being relatively common to humankind, gradually people given smarts can do anything the other also smart people can do. And, critical difference, those newly smart people can and are most willing to do it less expensively.
The smarts who were doing the work at more expense can be replaced by the newly smart willing to work longer and harder for less. Like the forests taken down over time to be replaced by junk woods, workers can be taken down over time and replaced by other workers who are not junk but quite competent for the tasks.
As manufacturing jobs first went south to find cheaper labor and then went overseas for the same purpose, middle class people and those with technological skills paid little attention. Now that middle class skills and technological competencies are being found overseas at lower costs, there is some low level alarm at "outsourcing" and such. This low level of alarm is proving easy to displace.
Not only workers can be upgraded in skills but capital accumulated by their efforts can begin to outbid and to replace the capital enterprises of the once smart. Once vaunted IBM PCs are now coming not from the once United States of America, but from PRChina. PRChinese capital is reaching out to grasp corporations of the developed world. Capital accumulation is moving offshore, too. Curve going exponential. The rum of international finance is no longer homemade.
Those successions of process have characterized the last decades of the twentieth century. Graphed, those successions are now showing signs of going exponential or have gone exponential. Economically, Japan overtook many functions of the American and European economies. Japan, in turn, has been overtaken by Korea, Hong Kong, Singapore, Thailand, Indonesia, et al. The dirty commie PRChinese are in process of not only overtaking all of them but also now gnawing at the economic viscerals of the once United States of America and Western Europe.
And, therein lies what history may later record as a major crack in the foundations of the once United States of America and Western Europe. We are in process of being out-globalized at our own games.
Can imperial force mend cracks? Time will tell.