Sunday, November 11, 2018

Connected and vulnerable: Climate change, trade wars and the networked world

The increasing connectedness of the global economic system has long been touted as the path to greater prosperity and peaceful relations among nations and their peoples. There's just one hitch: Complex systems have more points of failure and also hidden risks that only surface when something goes wrong.

For example, our dependence on cheap shipping to move commodities and finished goods has resulted in a system vulnerable to environmental disruption, particularly climate change, and to rising political and military tensions.

The extreme drought in Germany last summer, the warmest ever recorded in the country, has resulted in such low water in the Rhine River that shipping has been greatly curtailed. Ships can only be loaded lightly so as to avoid running aground. Consequently, many more barges and other vessels have been pressed into service to carry the lighter but more numerous loads along the river. This has driven up the cost of shipping considerably. In addition, fuel tankers have not been able to reach some river ports resulting in scattered fuel shortages. Some industrial installations along the river have had to reduce operations.

The natural inhabitants of the river have also suffered as die-offs of fish and other marine life have spread along the river.

A world away trade tensions between China and the United States are resulting in an unexpected threat to the preparedness of the U.S. military. The neoliberal program of free trade embraced by one U.S. president after another regardless of party has resulted in curious vulnerabilities for the military.

Because of the hollowing out of American manufacturing—as much of it migrated to China's low-cost labor market—the military can no longer fulfill certain needs from U.S. or even European manufacturers. Instead, the only place to source certain supplies is China, a country many now consider a potential military adversary of the United States.

Complicating the issue are recent U.S. trade sanctions against the Chinese. This could lead the Chinese to retaliate by withholding crucial goods such as rare earth metals over which it currently has a virtual monopoly and which are essential for modern electronics.

This is a political and military problem. But it illustrates the fact that complexities can trip us up because of both human-created and natural events. (Come to think of it, climate change isn't really a natural event; but the cause and the effect are delayed and diffuse unlike trade wars and real wars.)

Back in the United States the connectivity offered by the electric grid has become a huge liability for California utilities whose power lines have been implicated in past wildfires and who paid dearly for starting them. The combination of dry trees coming in contact with power lines and high winds which can down lines has forced utilities currently dealing with huge wildfires in their service areas to turn off gas and electric service in some places as a precaution. So frightened were investors about the potential liability facing California utility PG&E Corp. that the company's shares lost 16.5 percent of their value on Friday. Another utility, Edison International which serves the Los Angeles area, was down 12 percent for the day. Climate change and complex vulnerable infrastructure are intersecting in ways that have far-reaching and costly consequences, both in human and financial terms.

Anthropologist Joseph Tainter explains in his book The Collapse of Complex Societies that young societies solve problems through greater and greater complexity. The success of this strategy becomes so ingrained that the thought that complexity could become a negative is simply not contemplated. But that is what happens, Tainter explains. Returns on complexity diminish and then finally turn negative. The day complexity creates more problems than it solves foretells a decline.

Why does this complexity become a problem? Complexity makes it hard to understand the cause of difficulties. Because complex societies tend to be hierarchical and because those at the top of the hierarchy who make the major decisions also tend to be the most insulated from the problems of their society, they often don't even notice when important institutions and key environmental indicators are flashing red. They are slow to see and slow to act, often too slow to avert great damage and ultimately collapse.

The precursors of such a collapse are already present. But it takes an alert and aware mind to see the signs and link them to a larger danger. I have written in the past that the chief intellectual challenge of our age is that we live in complex systems, but we don't understand complexity. The danger signs are telling us something very difficult to hear: It is time to reduce the complexity of our society voluntarily or risk that the forces of nature (nudged in perilous ways by us) will do it for us.

This is a message almost impossible to absorb in an age that touts our increasingly complex and interconnected world as an unalloyed good. But there are experiments, for example, to bring farm and dinner table closer together; to build more energy self-sufficient communities; to live more simply without the largely useless abundance of consumer society; and to focus on the value of our relationships instead of our possessions. We should pay close attention to such experiments and participate in them as we are able.

Kurt Cobb is a freelance writer and communications consultant who writes frequently about energy and environment. His work has appeared in The Christian Science Monitor, Resilience, Common Dreams, Le Monde Diplomatique, Oilprice.com, OilVoice, TalkMarkets, Investing.com, Business Insider and many other places. He is the author of an oil-themed novel entitled Prelude and has a widely followed blog called Resource Insights. He is currently a fellow of the Arthur Morgan Institute for Community Solutions. He can be contacted at kurtcobb2001@yahoo.com.

5 comments:

Joe said...

Your recommendations for combating the dangers of complexity are good, but re-localizing important services such as energy and food supplies will require making local places more complex as larger regional spaces become less complex.

Take the example of energy supply to the home. A home relying on a central utility has a meter through which energy arrives at the home. An solar powered home that is disconnected from the utility gets to remove the meter, but it adds solar panels, an inverter, a battery, and a backup generator.

A similar effect plays out with regard to food. Instead of going to the grocery store and bringing food home in bags, a food-sufficient home needs arable soil, tools and machinery to work the soil, facilities for storing soil ammendments and all the required equipment, food processing spaces and equipment and food storage facilities. In addition, providing one's own food requires a large knowledge base and skill set. A small subsistence farm is far more complex than a house in the suburbs.

So any family or group that wants to become independent of complex international supply chains will need to spend a lot of money on all the stuff needed to replace those services, even if those services are greatly simplified and reduced. They will also need to take a great deal of time to learn how to do what others used to do for them.

Re-localizing also removes much of the efficiency of systems of centralized mass production, so reducing dependency on those systems will mean folks will need to pay more for less. What they will get in return is greatly reduced risk from future supply chain failures.

I think that risk reduction is worth it, but it will probably take a few major supply chain failures to convince many people that economic structural complexity has any downside at all.

Steve Bull said...

The gist of this article is very much like that which I have been emphasizing for the past few years in my local town and home province of Ontario. One of the concerns I have focuses upon 'food security'. The town I have lived in for the past 20+ years adopted the moniker of 'Country close the city' a decade or so ago to reflect its 'agricultural roots' while being close to the urban centre of Toronto. What I have witnessed over the years, however, is a seemingly orchestrated push to move away from this 'traditional' history and become increasingly just another large urban centre close to an even larger centre. Our population has grown about 10% per year over the past dozen years, more and more of our arable land is being paved over to construct suburban residential housing, and politicians advocate for more and more growth (because it's 'progress').
I have communicated my concerns with my local councillor, voiced my opposition at a number of council meetings, and written numerous times to our local newspaper (letters to the editor) to raise awareness in the community. To no avail, if the continuing growth and narratives pushed by the politicians is any indication.
My latest published letter reflects what I see as the main concerns of this article: the risk associated with long distance supply chains and infinite growth on a finite planet. (find it here: https://www.yorkregion.com/opinion-story/8960012-election-campaign-promises-rarely-align-with-reality/).
I have become increasingly concerned about food 'security' in my province, even locally, with the realization that Ontario depends upon food imports for close to 97% of our consumption, something most (all?) residents are completely ignorant of. Every year we see our population increase (primarily due to federally-mandated immigration quotas) while our arable lands are either increasingly dedicated to GMO corn/soybean to feed the ethanol industry or paved over to add to the housing bubble.
Finally, I agree with Joe's comments that "...it will probably take a few major supply chain failures to convince many people that economic structural complexity has any downside at all." But even then, I'm convinced the-powers-that-be will spin such disruptions to some externally-induced failure (probably some geopolitical foe).

Steve Offutt said...

I do not think trying to simplify our complex systems is a good idea. These complex systems and supply chains actually create resilience. The drought example given supports this. Without global supply chains and access to goods and services from elsewhere, the population of that region would be far worse off. The global vulnerabilities to disruptions in one area can be mitigated by access to goods and services from another area.
Going off grid may reduce certain vulnerabilities, but an even better solution is to have both: off-grid capability while still connected. This reduces risk to the individual.
The answers are not simple, they too are complex. Intelligently integrating smaller systems with larger systems (micro-grids connected to the macro-grid, for example) makes for greater resilience, more flexibility and, in my opinion, reduced risk.

Steve Bull said...

Steve Offut, I believe there is some truth in what you say, and that having redundancy and back-ups to our complex systems—especially our food production—is extremely wise. That being said, it makes little sense to me to be purposely pursuing policies that place greater and greater stress on such systems, increasing risk and fragility exponentially.

Pushing population well beyond an area’s natural carrying capacity and then relying almost exclusively on long-distance supply chains to feed that population is not only short-sighted but dangerous when those supply chains can falter without notice. To say little about the insanity of continually reducing local arable lands and/or depleting the soil’s natural fertility through massive industrial agriculture in place of organic food production to feed a local population. I see both of these unfortunate paths being pursued in Ontario (and many other places).

Yes, having redundancy is vitally important, but as archaeologist Joseph Tainter argued in The Collapse of Complex Societies, diminishing marginal utility on increasing investments in complexity always results in eventual simplification (i.e. decline/collapse). And the greater the complexity, the greater the fall for society.

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