Decision Making, Part Two

Okay, in part one I talked about the first rule of decision making in uncertain times: hedge your bets. This goes double (or even triple) for anyone who has children, particularly underage children. I listed the things you need to worry about: food, water, shelter, community and security. That’s it. Let me reiterate that a little more forcefully: don’t worry about your pension, don’t worry about healthcare. If things improve or don’t get any worse, they’ll be there. If things start getting really bad they won’t. Trying to protect them will only divert valuable resources away from keeping the things that do matter. Like food.

I also said I would take my best shot at prognosticating the future in this piece. That’s a risky business. But it doesn’t take a Nostradomus to look at the fact and read trendlines. So the first thing I am going to do is lay out a few facts and look at them.
Fact One: Fossil fuels are finite. They will run out.
Fact Two: Our entire civilization is based on fossil fuels, as well as on the massive use of other nonrenewable resources and the use of renewable resources at rates too great to be sustained.
Fact Three: Global warming is real and the effects are starting to be felt. Among these effects will be a progressive drying of arid and semi-arid areas while wetter areas will tend to get more wet. (That’s according to the best projections I’ve seen.)
Fact Four: Our economy is a house of cards.
Fact Five: We have seriously overshot our carrying capacity on this planet and, thanks to said overshoot, are currently degrading our environment severely.
Fact Six: No combination of alternative fuels will allow us to keep operating our civilization in the way to which we have become accustomed.

There are those who would argue with some of these, but they are all well supported by the evidence.
If you doubt fact six, take a look at fact two again. The problem is not just energy, and even if it was, all the alternative fuels depend on a fossil-fuel based infrastructure to make them work.

Okay, I’m going to start with facts one and two. Fossil fuels will run out. Period. All right, I’ll give a nod to the tech buffs and say that technically they won’t run out because we can’t extract every last drop, we will just run out of the ability to extract meaningful amounts. Satisfied? I didn’t think so. There are different kinds of fossil fuels and of course they will run out at different rates. The three most important are natural gas, oil, and coal.
1.) Natural gas is used for heating and electricity generation primarily. The U.S. peaked in natural gas production several years ago and production has been going down since. North America as a whole has also peaked but production hasn’t dropped too much yet. In twenty years there won’t be much meaningful NG production on the continent and what there is will be expensive. Importing NG is a tricky proposition at best. There are a lot of reasons for this, not the least of which is no one wants to blow up a port (and hence a city) when the inevitable accident happens.
2.) Oil is the biggie. Oil is used in literally everything in our society, from driving to work to the food we eat to the clothes we wear. It has a thousand different names and you it many of them every day. Not just gasoline but medication, plumbing, your electronics, everything in your life is either made directly from oil or has oil embedded in it at some point. Oil has either peaked or will do so shortly. This includes all the forms of oil: liquid, sands, shale, etc. We are either on the plateau of the peak or will reach it shortly and after that it is all downhill. Oil production will decline inexorably every year. You can drill anywhere you want but it won’t change that fact. In fifty years most people won’t have access to oil; in another century there won’t be any meaningful production to speak of. Oh, some I’m sure but not a lot.
3.) Coal is the other biggie. Coal is used to provide most of our electricity and also a lot of people’s heat. But there’s no problem with coal, is there? We have enough to last several centuries. Actually, no. According to the recent projections (see Richard Heinburg) coal will peak in, at most, 50 years and decline from there. Probably less as we attempt to substitute oil for coal.

So let’s see what we have right now: the entire underlying infrastructure of industrial civilization is going to disappear within the next century.
But no problem…none of us will be here in a 100 years. It will be our kids’ problem, right? No, because the effects of the depletion are all ready being felt and will only get worse. By the time I am a grandmother fossil fuels will not play a meaningful role in most people’s lives; by the time my future granddaughter has grandchildren of her own, they will be a distant memory. That’s what will happen in the next hundred years: fossil fuels will go from being an integral part of our lives to being a distant memory.

Even if we had an unlimited supply of fossil fuels, we are running out of everything else needed to sustain industrial civilization: water, topsoil, metals, wood, every single resource has been depleted. Nor can we say we weren’t warned. The Limits to Growth was dead on, right down to the timeframe effects would first be felt: 2000-2010. Let’s add in the effects of the other four facts and it is quite obvious that the next 100 years are going to be interesting. In the sense of the old Chinese curse, that is.

It should be obvious that some major crises and a lot of upheavals are going to be coming our way. And I’m talking about the next twenty years here. No, barring a nuclear war or an asteroid strike civilization will not collapse overnight but we are going to be facing crises. I expect that in the short term most cities will contract and densify while their populations expand. Why? Because a lot of people are not going to be able to afford gas over the next few years and are going to move inward where they don’t have to pay so much for transportation. This is all ready happening. At the same time, food prices are going up, as are utility bills. Climate change will begin to be felt. The economy will keep teetering and many of the jobs people move to the city for will disappear. At the same time, some manufacturing jobs may move back and so things may even out for a while.

The cities will have to change as things get worse. I expect most of the high-rises will either be abandoned or be taken down for scrap. These huge buildings are completely dependent on fossil fuels for everything –power, heating, cooling, ventilation, elevators. As utility prices climb or become sporadic it will make these behemoths less and less attractive as places to live and work. Most don’t even have opening windows. Sure, you could convert the windows but only at great expensive. Now let’s imagine what happens when the power goes or the elevators can no longer be maintained. Do you want to walk 30 or 40 stories one-way to your apartment or job everyday? If you try to stay in the city avoid the high-rises if you can.

As I said before, long-term I think the cities will lose population. Population numbers will decline everywhere (as they always do in the decline of a society), but people will move out of a lot of cities over next 100 years. Oh, the cities will still be there and people will still live in them–most cities are sited where they are for a reason and that will continue to be true. But as fossil-powered agriculture decline, more people are going to have to get involved in agriculture in some fashion. We’ll have enough oil to power industrial agriculture for some time, but what about the tools and machines? Will we have the parts and such to maintain them? The transition will not happen all at once but over time and at different rates in different areas.

Farmers need to have access to land, so this will result in more leaving the city centers. More farmers also means more of the people necessary to support them –blacksmiths, carpenters, general merchants, even pastors. Basically, entire villages. No, I’m not suggesting this many people are going to decamp from a city en masse and move to the country. Many of them are all ready there and others will transition over time. Plus, the flip side of the coin of most cities gaining population over the short term means that our rural population will continue to decline for a while. Eventually the pattern will reverse as people need to become more involved in food production. This is an organic process, not a mechanical one. I fully expect the suburbs ringing most cities will eventually evolve into small farming villages and many small towns will be revitalized. Others will be abandoned completely as they discover they are too far from the city centers or have other disadvantages.

I am not going to try and tell anyone where to live. Far from it. Each possible type of location –farm, small town, small, medium, or large city –has its own problems and advantages, as does each specific location. I’m going to list some advantages of each kind. If you are interested in my own biases, here they are: I don’t like cities. I think they are dirty, smelly, and crowded. I prefer elbow room. That said, I understand the allure and the appeal. I have visited big cities many times and like the convenience and the range of options. They are just not places I personally would want to live. Your mileage may vary. Okay, here are the lists.

Crime: Everyone mentions this, so I put it at the top. Crime will go up everywhere during the coming downturn, as will hate crimes. I do not believe the marauding hordes will ever come to pass but cities are much more prone to riots and gang violence than rural areas. But rural areas are much more prone to drugs (believe it or not) and burglaries and those living there have less capability of calling for help. Plus, hate crimes can be higher in rural areas, at least here in the south.

Power: this is a big one. If and when the grid starts to go down, guess who will lose it first? That’s right, the rural areas. On the other hand, guess who will have higher bills while it does last? The city. And if your city is like mine, they’ll evict you if you can’t pay your power bills.

Shipping: Cities win hands down on this. People in cities will have access to reliable shipping of goods and services and mail for longer than those in the country.

Transportation: Cities win again, thanks to the nearness of most things and mass transit. At least most cities –Houston and its sibs are obvious exceptions.

Population –it should be obvious that more people live in the cities than small towns and the country. This can be an advantage or a disadvantage depending on how you look at it. There’s more and more diverse people in a city, but they also have to have services. You may know everyone in a small town but you won’t in a city. If a disease breaks out its more likely to hit the city harder, given the close proximity of such a large number of people. Remember this also: until the early 1900s, most American cities were not nice place to live. Crowded tenements, filthy air, open-air sewers. We may be returning to those days for all but the rich.

Food –there’s more land in small towns and on farms to grow food, so they will probably have more while the city has shortfalls. Yes, some will be sent to the city but can you imagine feeding NYC’s teeming millions from the surrounding farms? Some people will grow food in the cities themselves of course, but the question is how much.

Water –it depends. Cities will be able to pay for processing and such longer, but small towns may be able to depend on cisterns or local streams.

Community –it also depends greatly on the type of small town or city.

Economics –diversified economies are the key. Any town or city that depends on only one industry –be it tourism or manufacturing –is going to be hurting in the years ahead. Small, isolated tourist towns are going to hurt as badly as Detroit and will probably hemorrhage population the same way. The only thing I feel comfortable predicting about any specific location is this: the Southwest will not do well. There is not enough water there to keep the current population going at even subsistence levels when the underlying base of fossil fuels begins to give way. A lot of people will be moving out of those areas, driven by need rather than desire.

So…how does all of this pertain to decision making in risky times? These are some of the variables you have to play with in making your decisions. This is not actuarial science; there are no risk tables to go to. All we can do is make the best decision possible and hope. And remember the cardinal rule: hedge your bets.

I’ll post more next time.