Wednesday, August 27, 2008

No Different This Time

The chorus of “Georgia On My Mind” that has flooded the Western media with broken-record persistence for the last few weeks, though it’s accomplished little else, has at least provided a few delicious snippets for connoisseurs of historical irony. We’ve seen the same politicians who backed the invasion of Iraq and the partition of Serbia insist that nations should not invade other nations, and that the territorial integrity of even the most jerry-rigged of today’s nation-states must be considered sacrosanct. Even by contemporary standards of moral posturing, this is breathtakingly ingenuous.

The Russians, for their part, are having none of it. The insistence of Western powers on treating Russia as a conquered province, rather than a proud nation with valid security concerns along its own borders, made an explosion inevitable; goad a bear often enough, and sooner or later it will turn on its tormentors. The war in Georgia, furthermore, is much more likely to be the beginning of a Russian response than the end. When the United States raised the stakes by signing an agreement to base missiles in Poland, the Russian government promptly replied by promising a military response. It seems unduly optimistic to hope that this response will consist of harmless gestures.

Amid the gunfire and oratory, though, a point with much broader application seems mostly to have been missed. Fifteen years ago, by most definitions of the term, Russia was a failed state, with a government coming apart at the seams, a military on the verge of mutiny, an economy being systematically looted by Western business interests and homegrown plutocrats alike, and an impoverished population struggling to survive in the face of food shortages, collapsing public health, and spreading pockets of local anarchy. All this followed one of the most dramatic discontinuities in modern history, the collapse of the Soviet Union.

That collapse has been used as a central piece of evidence for the claim that other industrial nations, especially the United States, could face similar discontinuities in the near future. Uncomfortable though this suggestion might be, it has quite a bit of merit, and several recent books – Dmitry Orlov’s mordant Reinventing Collapse in particular – have made a solid case for the possibility. Still, that case needs to be put in a wider context. Two decades on, Russia is no longer the failed state it briefly became at the bottom of the arc of collapse. Resurgent, resentful, and by no means unwilling to use its substantial natural resource base as a geopolitical weapon, Russia is back, and its return to the international scene as a major player is just as relevant as its earlier collapse.

The Russian trajectory from superpower status through collapse, contraction, stabilization, and recovery makes an interesting contrast, in particular, with the more common imagery of collapse that circulates in the peak oil community and elsewhere these days. While the events of the Soviet collapse were dramatic enough, the things that did not happen during that collapse are in many ways as important as the things that did. Despite economic collapse, for example, urban populations did not turn into starving mobs roving the landscape. Instead, as existing supply chains broke down, local entrepreneurs jerry-rigged new ones, and the backyard gardens of the Soviet era went into overdrive to keep most Russians fed even in the darkest days of the collapse.

In the same way, while Russia’s social order frayed to the breaking point and entire regions became battlegrounds for warring criminal gangs, this glimpse into the abyss of a Hobbesian war of all against all was not followed by the vertiginous plunge into anarchy that plays so large a part in today’s imagery of collapse. Instead, the great majority of Russians responded by moving in the other direction, backing the reestablishment of state power in the late 1990s even at the cost of individual liberty. Given the way that the rhetoric of democracy had been used to justify the looting of Russia’s economy and natural resources in the decade before then, after all, it’s hardly surprising that a common bit of Russian humor these days twists demokratiya – the Russian word for “democracy” – into dermokratiya, which works out to “rule by excrement.”

More generally, one of the crucial lessons of the Soviet Union’s collapse is that it was a self-limiting process. As bad as it was – and as Orlov and others have documented, it was much worse than anything Americans have experienced in living memory – it did not keep on getting worse; it bottomed out, stabilized, and then gave way to recovery. While Orlov’s own take on the prospects of American collapse is much more nuanced – and, at least to my mind, much more realistic – it’s very common to see this side of collapse roundly ignored in discussions of the fate of industrial society in America and elsewhere.

In these essays, and in much more detail in my book The Long Descent, I’ve suggested that this gap between the realities of collapse in history and the imagination of collapse in contemporary culture unfolds from the presence of cultural narratives that were originally borrowed from religious sources and repeatedly mapped onto secular history despite their consistent failure to anticipate the shape of any actual future. Recently, that claim has come in for some sustained criticism, ranging from suggestions that it misses the real points at issue to claims that it’s simply a rhetorical straw man used to brush aside competing viewpoints.

It’s not surprising that an attempt to contextualize today’s peak oil debates in this way would come in for criticism. Still, it can be shown that talking about the wider context of those debates is neither an irrelevancy nor a rhetorical gimmick. Perhaps the clearest way to do this is to point to another example of the same phenomenon – one that, just now, shows the relationship of narrative to reality with unusual clarity.

Two or three years ago, it was quite common to hear people insist that investing in real estate was the opportunity of a lifetime, a can’t-lose deal guaranteed to make the fortune of anyone canny enough to get on board. An impressive array of pundits, many of them equipped with Ivy League degrees, backed up these claims with books, articles, and seminars arguing that a new economic era had dawned and prosperity was within reach of all. The few critics who challenged these claims were denounced, often in heated terms, for failing to notice the huge and important differences that distinguished the real estate boom from failed speculative bubbles of the past.

Today, with housing prices in freefall and most of the industrial world’s largest banks scrambling to stay solvent under a cascade of failed mortgage loans, it’s clear that the pundits were wrong – totally, wildly, disastrously wrong – and their critics were right. What makes this relevant in the present context is that most of those critics did not make their case by examining the real estate bubble in fine detail. Instead, they recognized the real estate bubble shared a common cultural narrative with every other speculative bubble in modern history, from the Dutch tulip mania of the 17th century to the tech-stock bubble of the 1990s. They understood, as a result, that whenever anybody claims that a new economic era has arrived and some asset or other will increase steeply in value forever – no matter what the asset is, or what the circumstances happen to be – the proper response is to head for the exits as fast as possible.

This insight proved accurate because the arguments for a permanent real estate boom weren’t simply the straightforward response to circumstances that most real estate speculators believed they were. The speculators, and the pundits who encouraged them, were projecting a cultural narrative onto the inkblot pattern of a temporary and, to start with, relatively modest rise in real estate values. That narrative isn’t simply the generic conviction that real estate, or tech stocks, or tulips are destined to rise in price forever; it includes nearly all the rhetoric deployed in defense of that indefensible claim. (Read John Kenneth Galbraith’s trenchant The Great Crash 1929 and then look through the overenthusiastic articles on real estate that peppered the popular press in 2004 and 2005, and you’ll find any number of stock-jobbers’ claims from the flapper era recycled, sometimes word for word, for the twenty-first century’s first boom and bust.)

One of the essential claims made by the speculative bubble narrative, in turn, is precisely that “it’s different this time,” and the hard lessons of the past not only can but must be disregarded. Since any speculative bubble you care to name has some unique features – there had never before been a global real estate bubble, for example, and the ramshackle financial architecture tacked together to keep the bubble going was mostly brand new – it’s always possible to defend, at least to the satisfaction of speculators, the claim that the bubble in question isn’t a bubble and won’t pop. Events refute that claim over and over again, but it remains unassailable in each instance until and unless the underlying narrative is seen for what it is.

My argument, basically, is that the narrative of total collapse is another example of the same kind. Since the late 19th century, when religious apocalyptic began to lose its grip on the Western imagination, a narrative as stereotyped and dysfunctional as the narrative that drives speculative bubbles has circulated in the industrial world. That narrative claims that the world faces collapse of a historically unprecedented kind: sudden, complete, and final. Like the bubble narrative, the collapse narrative brings its own rhetoric with it, and applies that rhetoric to currently favored catastrophes – peak oil, global warming, the Y2K crisis, nuclear war, race conflict, every major comet of the last century and a half, you name it – in the same way that the bubble narrative applies its rhetoric to the asset class du jour. Like the bubble narrative, in turn, the collapse narrative always insists that the failures of the past don’t matter, because it’s different this time.

The narrative of collapse shares another feature with the bubble narrative: it produces consistently inaccurate predictions about the future. Again, people have been predicting collapse in the terms of the narrative for around a century and a half, using arguments identical in form to the ones now being used to justify the same predictions today, and the results have not exactly been good. This isn’t simply a function of the future’s obscurity, for other approaches – based on other, more nuanced narratives – have yielded better results. Arnold Toynbee and Oswald Spengler both made predictions about the cultural evolution of the modern West, for example, that have proved quite prescient. For that matter, the central argument of The Limits to Growth – that unlimited economic expansion would bring industrial civilization up against hard planetary limits in the first half of the 21st century, leading to an age of crisis and contraction – seems far more plausible now than it did when first published.

This reasoning undergirds my suggestion that it’s crucial to recognize the collapse narrative for what it is, and set it aside as a guide to the future, just as anyone hoping to make sense of economics in the real world would be well advised to start by setting aside the bubble narrative. Insisting that it’s different this time, and a way of thinking about collapse that has consistently produced false predictions for a century and a half is going to turn out accurate this once, just doesn’t seem plausible to me.

I suspect Dmitry Orlov is right that America is facing a collapse along the same lines as the Russian experience. If that happens, though, it’s just as likely that twenty years on, something like the rest of the Russian experience will have replicated itself as well, and an approximation of today’s United States will have undergone some degree of recovery from collapse. Equally, other regions of the world will likely be experiencing their own trajectories through the twilight of the petroleum age, and some of those trajectories will include sudden downward jolts of varying severity. Over the long term, as I’ve suggested, all those trajectories will trace out a broad pattern of decline, but history shows that the decline of a civilization is a complex thing, and there’s no reason to think that it will be different this time.

Wednesday, August 20, 2008

The Tempo of Change

One of the lessons of history is that change, no matter how drastic it appears on the pages of history books, is rarely anything like so sudden for those who live through it. Read an account of the French Revolution, for example, and events seem to follow one another like explosions from a string of firecrackers, from the final crisis of the Ancien Régime straight through to the fall of Napoleon. For the man or woman in the French street, though, these happenings were scattered threads in a fabric of months and years woven from the plainer cordage of ordinary life.

Partly this is a function of the way historical narrative compresses time. It bears remembering that a teenage Parisienne who sat daydreaming of her upcoming wedding on the day that Louis XVI summoned the États-General in 1788 would most likely have been a grandmother on the day the Allied armies marched into Paris after the battle of Waterloo in 1815. Equally, though, it’s rare for historical events to have the same apparent importance at the time that they are assigned in the historian’s hindsight, not least because the everyday process of making a living and moving through the stages of human existence plays a larger role in most lives than the occasional tumults that make the history books.

This lesson needs to be kept in mind as we try to make sense of the implications of the crisis of industrial society, not least because it offers some protection against the common bad habit of projecting daydreams onto the inkblot patterns of the future. That habit of thinking is more than usually at issue in exploring the theme of this week’s post, the nature of daily life in the decades ahead of us.

The role of wishful thinking in driving the apocalyptic expectations so common in contemporary culture rarely shows itself so clearly as here. In the weeks leading up to the Y2K noncrisis, I knew quite a respectable number of people whose conviction that industrial civilization was about to undergo total collapse was all too clearly motivated by the belief that this meant that come January 1, 2000, they would no longer have to continue living the lives they had made for themselves. You’d think that the prospect of mass death would be a good deal more daunting than even the most humdrum modern existence, but it’s always part of the narrative of imminent apocalypse that dieoff only happens to other people; no matter how poorly suited the people in question were to the strenuous task of surviving the overnight collapse of a civilization, each one of them believed that they’d be among the lucky few.

The same sort of logic pervades certain corners of the peak oil scene. I’ve met far too many people who don’t know enough about plant care to keep a potted petunia healthy, and have very likely never put in an eight-hour day of hard physical labor in their lives – most middle class Americans haven’t, after all – and yet who nonetheless talk enthusiastically about the life they expect to lead in a self-sufficient rural lifeboat ecovillage as industrial civilization crashes into ruin a comfortable distance away. It’s all very reminiscent of the aftermath of the Sixties, when a great many people headed back to the land with equally high hopes; the vast majority of them straggled back to the cities a few months or years later with their hopes in shreds, having discovered that fantasies of the good life in nature’s lap make poor preparation for the hard work, unremitting discipline, and relative poverty of life as a subsistence farmer.

The would-be communards of the Sixties had an advantage not shared by their counterparts in the peak oil movement. Rural land was relatively cheap, and money was fairly easy to come by, not least because the counterculture scene always had a sprinkling of members with large trust funds who functioned as the sugar daddies of the movement. As the Summer of Love gave way to the summer of Altamont and the urban neighborhoods that nurtured hippie culture went to seed, communes in the countryside were a significant option, and a great many of them – I don’t know that a census was ever done, but there were certainly thousands – sprouted as a result.

That has not happened in the wake of peak oil. Partly, of course, it’s one thing to leave the city behind for a rural commune when you’re nineteen years old and can put all your worldly goods into a knapsack, with plenty of room left over for dreams; it’s quite another thing to do that when you’re forty and comfortably middle-class, with a family to support, a career to think of, and the prospect of retirement sufficiently visible on the horizon of your future that the impact of your choices on your pension is always somewhere in your thoughts. Today’s peak oil activists very often resemble the second of these categories a good deal more than the first, which goes a long way to explain the gaping difference between the number of lifeboat ecovillages that have gotten onto the drawing boards and the number of them that have actually been built.

Still, this is only one reflection of a much broader problem, which is that lifeboat ecovillages do not make economic sense in today’s world. However self-sufficient they may turn out to be in the deindustrial future their planners envision, they are anything but self-sufficient here and now, when they have to be built and paid for. Nor is it at all clear how soon they will become self-sufficient if the future turns out to be a gradual descent into the deindustrial age, rather than the sudden plunge so often imagined these days.

This is where the perspective I brought up at the beginning of this essay – the difference between history as read in retrospect, and history as lived at the time – becomes crucial. Seen in retrospect, the changes that will follow the decline of world petroleum production are likely to be sweeping and global. From the perspective of those who live through them, however, those changes are much more likely to take gradual and local forms. This will make them harder to notice, but paradoxically easier to meet.

Imagine, for example, a scenario in which worldwide production of conventional crude oil drops by an average of 5% a year, and other fossil fuels follow gradual depletion curves of their own. Especially at first, the gap can be offset with biofuels, tar sands, and other unconventional sources; yearly production totals for liquid fueld may even increase, though this won’t include an accounting of the fuel burnt to extract oil from tar sands or the petroleum products used to grow biofuel crops, and thus will hide the fact that there’s less energy available for other uses. The need to funnel an ever-increasing fraction of fuel into producing more fuel, coupled with expanding global population and the ongoing transfer of economic and political power from an aging American empire to its successors, will tend to drive fuel prices up; economic contraction driven by the twilight of cheap energy will tend to decrease demand, and drive them back down; factor in speculation, and you get wild gyrations in energy costs, coupled to cycles of economic boom and bust of an intensity not seen in the Western world since the nineteenth century.

All of this spells trouble, without a doubt. To rising energy prices and contracting economies, add the public health consequences of increasing poverty and the likelihood that the end of the American empire will result in wars as bloody and protracted as those that followed the decline of every other major commercial empire in recent history, and you get a recipe for massive change. I’ve argued in previous posts that these changes mark the first stage of the decline and fall of Western industrial civilization – the change from affluence industrialism to scarcity industrialism – and that it will be followed by further stages of contraction and social transformation, leading into a dark age several centuries long from which our successor societies will eventually emerge.

From the perspective of some future Edward Gibbon of the year 3650 or so, outlining The Decline and Fall of the American Empire as he strolls past sheep grazing on the mossy ruins of ancient Washington DC, all this will doubtless seem traumatic enough. For those who experience that transformation first hand, though, it will likely have a much different appearance. The young Parisienne whose image I invoked at the beginning of this essay, after all, did not go to sleep one night in the agrarian, half-feudal France of the Ancien Régime and wake up the next morning as a grandmother in the nascent industrial nation that France became in Napoleon’s wake. Even those changes in the interval that brought her grief – any sons she had, for example, would have faced high odds of dying a soldier’s death – would have been spread out over the years, part of a fabric of many other experiences.

Similarly, the unraveling of today’s industrial society can be expected to follow a similar tempo of change. If the scenario I’ve outlined above is anything close to the shape the future holds for us, we can expect to witness economic, social, and political turmoil beyond anything the industrial world has experienced in living memory. We will all be attending more funerals than we do nowadays, and our appearance as the guest of honor at one of them will likely come noticeably sooner than it otherwise would. Most of us will learn what it means to go hungry, to work at many different jobs, to have paper wealth become meaningless, and to watch established institutions go to pieces around us. A quarter century or so from now, the world may be a very different place, but on the way there each of us will have had to deal with the same unoriginal challenges of everyday life we face today.

The continuity of history as a lived experience imposes requirements on planning for the post-peak future that haven’t always been noticed. Like the imaginary lifeboat ecovillages that would make perfect economic sense in an imagined world, but can’t even scrape together the funding to get built in this one, a good many of the plans and projects that have been discussed as a response to peak oil make no provision for the fact that people will still have to live their lives and make a living while they wait for those projects to justify themselves. Those projects that make good practical sense here and now, or at least place no great burden on the people who choose to pursue them, will be a good deal more viable than those that can only support themselves in a radically different world than the one we inhabit. In the weeks to come I plan on sketching out some outlines of how such an approach to the future might be crafted.

Wednesday, August 13, 2008

Idols of the Marketplace

As last week’s post suggested, the forces that keep American families stuck on an economic treadmill, trying to meet new and challenging conditions with old and increasingly dysfunctional responses, are by no means entirely economic in nature. Despite the polite fiction that all players in the economic game are rational actors pursuing their own interests in free exchanges, most of the decisions individuals make in the course of that game involve precious little of the sort of rational deliberation the fiction suggests.

To begin with, of course, a great many of the choices are enforced. I think it was Anatole France who pointed out that equality under the law, as often as not, amounts to forbidding the rich as well as the poor to sleep under bridges, steal bread, or beg for coins in the street. For many Americans, and most people elsewhere in the world, the freedom to exchange their labor for money amounts to a Hobson’s choice between sweatshop labor at poverty wages, on the one hand, and starving in the streets on the other. America’s caste system is somewhat more flexible than average, and its privileged classes long ago figured out the advantages of opening their doors to a trickle of aspirants from below, but access to economic opportunity in America still depends to a very large extent on how much money your parents made.

Yet the power of cultural narratives and myths, a frequent theme in these essays, also plays a massive role in leading supposedly rational actors into the irrational decisions that shape so much of our collective lives these days. The twilight of the household economy, the theme of last week’s post, is a good example. A number of my readers responded to the post with emails describing couples they knew who maintained two salaries, even though the costs incurred by doing so – professional childcare, commuting, office clothing, and more – far exceeded the income of the less lucrative of the two jobs. This is quite common nowadays, because the cultural narratives surrounding employment make it impossible for most American families to notice that their economic status might be improved noticeably by giving up one salary in exchange for full-time involvement by one family member in the household economy.

Behind the narratives that prop up this curious blindness, though, lies a broader pattern, and it’s this that I want to discuss this week. For reasons rooted in history, it’s difficult to talk about the theme I have in mind without stirring up passions of the most irrational and intemperate kind. Still, the attempt has to be made, because the narrative in question is turning out to be a massive barrier to constructive change as we approach the twilight of the industrial age. The cultural story I have in mind is the myth of the market.

The measure of a narrative’s power is the extent to which its believers miss the fact that it’s a culturally conditioned narrative, and treat it as an objective reality obvious to any unbiased observer. This condition is widespread enough in the case of today’s market mythology that it’s probably necessary to sketch out the narrative in some detail. In simplest terms, the myth of the market starts from the belief that all human economic activity naturally involves free exchanges of value in a free market, mediated by an accepted measure of value – that is, by money. The myth goes on to claim that any economic activity outside the world of market exchanges either doesn’t count, doesn’t contribute to prosperity, or is a bad thing that can only be redeemed by bringing it within the sacred precincts of the market. Finally, the myth insists, anything that restricts or regulates the choices made by participants in market exchanges is a bad thing, guaranteed to hinder prosperity, because the market itself – guided by Adam Smith’s famous “invisible hand” – inevitably maximizes the benefits received by all its participants, so long as it’s given the freedom to do so.

I have used the word “myth” here deliberately, with an eye both of its current meanings. Its older meaning – the sense possessed by its source, the Classical Greek word muthos – defines a myth as an important cultural narrative, a story that every full participant in the culture can be expected to know, that serves as a paradigm for some aspect of humanity’s experience of itself and the world. Its more recent, derivative, and polemical sense defines a myth as an important cultural narrative that happens to be false. In this second sense, proving that something is a myth doesn’t mean showing that it plays a crucial role in some society’s view of the world; it means showing that whatever it says about the world is untrue.

Now it so happens that some cultural narratives are myths in both senses of the word: they are crucial elements of a society’s view of the world, and they also make statements about the world that can be shown to be untrue. The myth of the market falls into this interesting category. Just now, in America and some other industrial nations, it plays a central role in defining how people think about the economic dimension of their lives. At the same time, some of its core assumptions, and many of the statements about the world that derive from it, are hard to support on any basis but blind faith.

This is where the intemperate passions I mentioned earlier enter the picture, of course, because the myth of the market is not simply a cultural narrative; it’s also an ideology supported by a great many people just now. There’s a complicated history behind its current ideological role. The grand geopolitical struggle between the American and Russian empires that occupied most of the twentieth century, and still makes headlines today, followed the usual custom and borrowed ideological garments to provide a scrap of decency to the clash of naked ambitions.

The American empire’s first choice of ideologies to counter Russia’s Marxist polemics was Christianity – this is why, for example, the words “under God” were tacked onto the Pledge of Allegiance during the Eisenhower administration, and why the word “Russia” rarely appeared in American political speech for more than two decades without the adjective “godless” in front of it. This turned out to be a bad choice, though, not least because it had little appeal outside America’s borders. A secular ideology had to be coined, and free market capitalism filled that need. It’s not accidental that many of its active proponents in recent years were Marxists during their years of adolescent rebellion in the 1960s; much of what now passes for economic thought in America simply takes Marxist assumptions and stands them on their head, in the same way that Satanists borrow most of Christian theology but root for the other side.

The Siamese-twin relationship between Marxism and today’s free market ideology can be seen most clearly, perhaps, in the insistence on both sides that the only valid position on the spectrum of possible relations between government and the economic sphere lies at the two extremes: either all economic activity should be controlled by the government, or the government should have nothing to do with the economic sphere at all. I doubt anyone just now needs to be shown that the Utopian promises of Marxism don’t work in practice, but the current ideology of the free market is another matter. Still, the evidence of history simply doesn’t support the claims made by free market advocates.

Track the economic history of the United States in the 20th century, for example, and an interesting pattern emerges. Until the 1920s, a free market ideology far more principled than its current equivalent dominated American politics; government kept its hands off business until the crash of 1929 and the Great Depression made that politically impossible. During the Depression years, politicians imposed an alphabet soup of regulations on the American economy, and those remained in place until the early 1980s, when most of them were removed. If the myth of the market is to be believed, the American economy should have been more prosperous before the mid-1930s and after the mid-1980s than in the intervening period.

The problem, of course, is that this isn’t what happened. Until the 1930s, the American economy was racked at regular intervals by a disastrous cycle of booms and busts that drastically limited American prosperity and made severe economic depressions a frequent experience. As the New Deal took hold, the economic cycle damped down to livable levels, and the United States entered the longest period of general prosperity in its history. That prosperity waned in the 1970s as US oil production peaked and began to decline, but the deregulation of the 1980s did not bring it back. For most Americans, per capita income in constant dollars has declined since the early 1970s, and many other measures of effective wealth have slumped accordingly; the rate of infant mortality in America today, for example, is roughly on a par with that of Indonesia.

What has returned, and in spades, is the old cycle of boom and bust. Since the beginning of the Reagan years, speculative booms and their inevitable implosions have once again become a dominant feature of the economic landscape. So far, the US government has responded to each popping bubble by ignoring its own free market rhetoric and flooding the economy with borrowed money. There seems to be some doubt about whether that strategy will work in the aftermath of the most recent incarnation of the process, the real estate frenzy of 2002-2006; one way or another, though, US government, corporate, and individual debt has soared to unsustainable levels after these binges of borrowing, and a reckoning cannot be avoided forever.

Of course it’s possible to argue that the regulations established in the 1930s and eliminated in the 1980s had nothing to do with the period of relative economic stability and rising national prosperity that arrived in the 1930s and ended in the 1980s. Look beyond US borders, though, and the same patterns show up. The nations with the highest standards of living today, for example, are not those that have embraced an unrestricted free market, or for that matter those that have subordinated all economic activity to the political sphere. Rather, they’re nations that have found a middle ground, leaving economic activity in private hands but regulating it where necessary for the public good, and in particular, preventing it from indulging in the self-destructive excesses it pursues when left to itself.

That middle ground, granted, lacks the simplistic good-and-evil categorization that makes for a popular ideology these days. It’s pragmatic, it’s sloppy, and it requires constant tinkering and a willingness to deal with the reality of conflicting interests. All that can be said for it is that, by and large, it does seem to work better than the alternatives.

Well, that may not be quite all that can be said for it. One of the fundamental axioms of ecology is that an ecosystem becomes more stable and productive as it becomes more balanced. Cycles of boom and bust are common in marginal ecosystems, where nothing controls populations except the crude forces of food supply and starvation; as ecosystems develop complexity and richness, subtler factors come into play, and conflict and chaos give way to equilibrium. Economic systems may well be subject to the same rule.

Political systems certainly are; the success of democratic systems of governance, after all, depends precisely on the extent to which they establish and maintain a balance of powers in which no one has unchecked authority. Today’s market economies may be badly in need of a dose of the same medicine. Part of the countervailing force that’s needed to pull them out of the vicious cycle of speculative boom and bust will likely come from government regulation, but the same principle may need to be applied in other ways, not least to keep government power from ballooning further out of control than it already is.

Just as it’s clearly not true that the unregulated market automatically brings prosperity – the invisible hand, it turns out, is quite capable of giving us the finger – the issues raised in the last two posts suggest that it’s also not true that all economic activity ought to be subject to the market’s vagaries. Economies outside the market system could play a large role in helping to balance out the market’s wobbles. The household economy is one potential balancing force; another could come from local economies driven by the very different forces of reciprocity and custom, in which surplus products are exchanged as gifts between neighboring families. Other economies beyond the market also deserve exploration.

The crucial thing to keep in mind, it seems to me, is that subservience to the intellectual idols of the contemporary marketplace may well turn out to be profoundly counterproductive in the years ahead of us. The market economy is already having to deal with rising transportation costs and the twilight of the short-lived global marketplace, and will shortly have to face the desperate need to retool our lives and productive capacities to meet the requirements of the dawning age of scarcity industrialism. In such a context, remaining stuck in a rigid, ideologically based stance about the proper relationship between the market economy and other sectors of society may be a luxury we can no longer afford.

Wednesday, August 06, 2008

Reviving the Household Economy

Part Two: The Decline and Fall of Home Economics

Raspberry jam, the ostensible subject of last week’s Archdruid Report post, is only one of hundreds of goods and services that until recently were produced almost entirely in the household economy, outside the reach of the market. Nowadays, by contrast, nearly all those goods and services are either produced commercially or are not available at all. This represents an economic transformation on a massive scale, and yet it’s one that has seen remarkably little discussion by economists.

It also represents a social transformation of equally massive scope. Visit the library of an American public university that has not yet taken up the currently fashionable habit of purging its collection of “outdated” materials, wander through the stacks until you find the dingiest and most neglected shelves in the building, and odds are that you’ll be looking at the mummified remains of a field of study, a profession, and a university department as dead as the dinosaurs, and a good deal less popular nowadays: home economics.

Not all that many decades ago, an impressive network of home economists working for universities, county extension services, and private industry provided an extensive support system for the household economy. Backing that network, and the by no means negligible expenditures that supported it, was an almost universal consensus that recognized the social and economic importance of the household economy. The experience of two world wars, in which government-promoted home economics measures had played a major role in softening the impact of food rationing and enabling the United States to feed armies and allies alike, gave support to that consensus.

At the same time, the household economy had long faced steady pressure from the expansionistic habits of the market economy. Beginning around the end of the 19th century, and accelerating over the decades that followed, the market seeped into the domestic sphere with a steady stream of “convenience” products and “labor-saving” devices. Many of these were neither convenient nor labor-saving, but the massive marketing programs that backed them up made them highly fashionable, especially in the newly prosperous middle classes that emerged as the 20th century wore on and America entered on its age of empire.

These two major social forces – the broad consensus surrounding the domestic economy and the expanding pressure of a metastatic market economy – finally collided head on in the decades following the Second World War. A third force, however, played what may well have been the decisive role in the collision. Bringing up that third force at all may be problematic, for it’s remained a hot-button issue in American culture right down to the present, and very few people seem to be able to discuss it dispassionately just now. Still, what happened to the household economy is impossible to understand without taking it into account. That force, of course, is the role played by the economics of gender in launching and shaping the second wave of American feminism in the 1960s and 1970s.

Many currents of social change flowed together to launch the women’s movement of the 1960s, but one factor that has not always been given its due is the impact of the abrupt changeover from the war economy of the 1940s to the consumer economy that followed it. As the troops came home, government and industry alike did everything in their very considerable power to get Rosie the Riveter off the factory floor and turn her into Suzy Homemaker as fast as possible, in order to free up jobs for millions of demobilized soldiers. At the same time, the quest for markets to fuel the consumer economy’s expansion and employ those same millions threw the market assault on the household economy into overdrive.

Postwar propaganda – “advertising” is too mild a word for the saturation campaigns that flooded the popular media in the late 1940s and early 1950s – presented middle class families with a glittering image of affluence in which convenient, up-to-date consumer products provided by the market would replace the dowdy routine of the domestic economy with a life of elegance and leisure. The reality behind the facade turned out to be much less palatable. Denied both the place in the market economy they had occupied during the war years, and the role in the household economy their mothers had held before that, millions of middle class women across America found themselves expected to lead a purely decorative and essentially purposeless existence.

As a motor for rebellion, deprivation of meaning is even more potent than deprivation of food, and so an explosion was inevitable. Many of the forms that explosion took were altogether admirable. A great many injustices were set to rights, or at least challenged, and social roles that had become hopelessly restrictive for women and men alike came in for a much needed reassessment. Still, as the feminism of the Sixties and Seventies percolated outward into popular culture, it suffered in some measure the common fate of progressive social movements in the modern West: instead of challenging the system of male privilege, and the presuppositions that underlay it, a great many women who considered themselves feminists simply set out to seize their share of the positions of privilege within the existing system.

In the process, no small number of them embraced the manners, mores, and attitudes of those they hoped to supplant. Compare a Playboy from the 1960s with a Cosmopolitan from the 1980s, for example, and it’s impossible to miss the parallels, all the way from the shared obsession with sexual conquest, conspicuous consumption, and personal appearance, to the mutually interchangeable cover girls meant to allure potential readers. The astonishing thing is that the “Playboy man” and the “Cosmo girl,” those airbrushed icons of consumer culture, were both considered to be liberated, and liberating, in their day.

The household economy, or what was left of it, was one of the casualties of the process that made these dubious figures popular. The feminist movement might have posed hard questions about the relative social value assigned to the household and market economies, and indeed some of the subtler minds within the movement made forays in this direction, but their ideas found few listeners. Instead, many feminists – and ultimately a great many American women – simply accepted the relative values their culture assigned to the two economies, and aspired to the one that they were taught to consider more valuable. The ensuing shift in attitudes cut the ground out from under the consensus that once made home economics relevant; by the 1980s most universities had closed their home economics departments, and county extension agencies and private firms followed suit.

Still, the old social roles assigned to women carried so much emotional force in the collective imagination for so long that they had to go somewhere. To a remarkable extent, they came to be applied to the institution that supplanted the economic roles once held by women: the market itself. Look at the rhetoric applied to the market over the last few decades and you’ll find every cliché applied to women in 1950s men’s magazines present and accounted for.

The market, in effect, has become American society’s coquettish and curvaceous sex kitten, its June Cleaver mom complete with patriotic flags and apple pie, its nubile innocent waiting to be rescued from the lustful grasp of government regulations and tax collectors. Placed on a rhetorical pedestal as absurdly florid as anything Coventry Patmore ever said about Victorian womanhood, and abused and exploited as ruthlessly as Victorian women so often were, the market is America’s pinup girl, the focus of overheated notions every bit as detached from real life as the fantasies that filled the pages of Playboy or Cosmo in their prime.

Any attempt to rebuild the household economy in the wake of peak oil will inevitably have to contend with these issues. It’s not at all uncommon today, for example, to find couples for whom the cost of professional childcare, an extra car and commuting expenses, and the other costs of a two-salary lifestyle add up to more money than the second salary brings in. In many cases these families would come out substantially ahead if one of the adults were to stay home and provide the same services within the household economy, but in the present social climate, this option is very nearly unthinkable for many people.

As a longtime househusband, I can speak to this from a certain degree of experience. During slightly more than half of 24 years of married life, it made a great deal more economic sense for my spouse, a bookkeeper, to work in the market economy, while I tended the garden, cooked the meals, did most of the cleaning, and worked my way through the long learning curve of a career as a writer in my off hours. I came in for a fair amount of criticism for making this choice, though I have to say it was a great deal less savage than the treatment meted out, mostly by other women, to women I knew who made the same choice. Despite the pressure, though, it was unquestionably the right choice for us; it enabled us to maintain a very comfortable lifestyle on a modest income.

That choice is likely to be at least as valuable an option for a great many more people as the market economy contracts in the wake of peak oil. The abandonment of the household economy, after all, was only viable in the first place because of the temporary conjunction of American imperial expansion with the rapidly expanding fossil fuel production of the postwar years. As America’s empire frays and global energy production falters, the costs of the energy-intensive economic structure we have built over the last sixty years will fairly rapidly begin to outweigh its benefits. In that context a renewal of the household economy offers one valuable set of tools for taking up the slack and providing needed goods and services, and those dusty books in the home economics section of your local college library may turn out to be valuable once again.

Such a renewal, though, will require a reassessment of social roles and values as ambitious as anything the pioneering feminists of the 1960s envisaged. Measures of value evolved within the market, and shaped to a large degree by market-centered ideologies, fall flat when applied to nonmarket economies in which custom, reciprocity, and collective benefit govern exchanges, rather than the quest for individual profit. Money itself, that abstract fiction that has very nearly smothered the real economy of goods and services it originally evolved to support, may be a good deal less relevant as alternative forms of value become ascendant. The form that will be taken by those alternatives in the ecotechnic world of the future is probably impossible to guess at this point, but an openness to options and a willingness to look beyond the market are likely to be valuable steps just now – and a renewed household economy may just turn out to be the seed from which the economics of the future can take root and grow.