[R-G] [BillTottenWeblog] Presto Change-o

[Bill Totten]

Clusterfuck Nation

by Jim Kunstler

Comment on current events by the author of
The Long Emergency (Atlantic Monthly Press, 2005)

www.kunstler.com (November 10 2008)


As the election campaign ground on like a 3000-mile race between a
greyhound and an armadillo, the media kept harping on Barack Obama's
vague promises of "change". We now know what the main promise was:
regime change, right here in the USA, not in some place where the
natives wear strange headgear. Mr Obama's victory was a moment of
epochal exhilaration, not least because he appears to be a decent and
intelligent person self-made from a humble background - someone who has
personally bought tube socks in the K-mart, worried about money, and
made many trips in a subway car.

The current occupant of the White House, however, has sedulously
prepared for his successor the biggest shit sandwich the world has ever
seen, and there is naturally some concern that Mr Obama might choke on
it. The dilemma is essentially this: the consumer economy we all knew
and loved has died. There will be pressure from nearly every quarter to
keep it hooked up to the costly life support machines even though it is
dead. A different economy is waiting to be born, but it is nothing like
the one that has died. The economy-to-come is one of rigor and
austerity. It is not the kind of thing that a nation of overfed clowns
is used to. Do we even have a prayer of getting to it, or are we going
to squander our dwindling resources on life support for something that
is already dead?

A case in point: the car industry. The Big Three, all functionally
bankrupt, are now lined up for bail-outs from the treasury's bottomless
checking account. Personally, I believe the age of Happy Motoring is
over. Many Americans have already bought their last car - they just
don't it yet. The current low-ish price of oil is a total fake-out,
having to do much more with asset-dumping in the paper markets than the
true resource supply-demand equation. Most of the world (the media for
sure) has ignored preliminary leaks from the International Energy
Agency's (IEA) forthcoming report which forecasts global oil depletion
to be 9.1 percent in 2009. This is a staggering figure, very likely to
offset whatever slack we see in global demand from the worldwide
economic crisis. In fact, the global oil markets are poised for the most
severe dislocations ever seen, meaning it's a toss-up what happens first
in the USA: a major leg back up in oil prices, or shortages, hoarding,
and rationing.

For my money (literally) there are only two main reasons that any
portion of the car industry should be rescued at the present time: one,
because we need somebody to manufacture engines for military vehicles,
and two, because we need somebody to manufacture rolling stock for the
revival in passenger railroad service that will have to be a centerpiece
of the future economy if we want to remain a civilized nation.

Even the progressive factions of the public may be in for much more
"change" than they bargained for. The global economy as we knew it is
finished (despite British PM Gordon Brown's fatuous suggestion that we
are ready to formalize it). The world is about to lose its "flatness"
(sorry Tom Friedman) and get much rounder. For one thing, the racket of
American "consumers" gobbling up the output of Asian factories in
exchange for paper promises is over. For the moment, the Chinese are
struggling with epic factory closures with the sudden prospect of a
restive lumpenproletariet. The situation there is bound to get worse.
Before long, these broke-and-hungry masses may actually challenge the
present government. In the meantime, there's no telling what the
(unelected) Chinese government might do either to keep itself in power,
or genuinely defend its country's perceived economic interests. One
thing is self-evident: we are not returning to the old racket of
toys-for-treasury-bills. One thing China might do in economic
self-defense is shed whatever US dollar-denominated paper is moldering
in their vaults before it becomes valueless altogether.

As global trade relations wither, and they will, the US will be thrust
back on its own devices, at the same time that oil resources grow
punishingly scarce. Mr Obama will have to contend with the necessary
radical reform of all the activities necessary for daily life here. Near
the top of the list - invisible to most of the public so far - will be
the question of how we produce the food we need. Industrial farming is
done, just as suburbia is toast. Mr Obama will have to apply plenty of
ass-time to the first stages of negotiating this bottleneck. I don't
even know what he can do policy-wise, though he can certainly make it
plain to the public that we have to grow more of our food close to home
and do it with fewer engines and fewer oil-based soil supplements. It is
a problem of such surpassing difficulty that it was not even close to
being in the election arena. The transition will probably occur by means
of "emergence". Self-evident necessity will prompt different behavior
and different ways of doing things. Sooner or later, the new
arrangements will self-organize - if we don't squander resources
defending an unsustainable status quo. One thing we can certainly
predict is that growing our food will require more human labor and
attention - meaning there will be plenty of work for people currently
losing their jobs at The Footlocker and Arby's, but it's far from
certain whether they will be happy in their new vocations.

We're going to have to resume making things in the USA again, too,
probably at a more modest scale, and probably fewer things than we are
used to. We have no idea yet how this is going to happen. Like
agriculture, manufacturing culture may have to return, if at all,
emergently, as individuals and communities see opportunity in advantages
like proximity to water-power and water transport. My guess is that
corporate enterprise as we have known it - at the continental and global
scale - is done for. I would not bet on any of the Fortune 500 carrying
on the manufacturing work of the future using the plants-and-equipment
that are familiar to them. The manufacturing of the future may be more
like cottage industry than Proctor and Gamble. Yet, obviously, there
will be tremendous efforts to prop up failing corporate enterprise and
prevent natural bankruptcies from occurring.

Similarly, the retail part of the economy. Many observers think that
Wal-Mart and its clones are immune to the larger forces swirling around
us. Just because many cash-strapped people are hunting for bargains at
WalMart these days does not insure the survival of the Big Box model
very far into the future. In fact, in every trend we can see - from the
oil markets to events in China to the impoverishment of the US working
class to the coming crisis in truck transport - you can easily discern
fatal weaknesses in this model. Local retail (and its support
structures) is coming back. We just don't know how, yet, and we don't
know how much capital and effort will be squandered trying to rescue
WalMart, when the time comes. But the imperative re-scaling of commerce
in America also represents huge opportunities for young people to get
into their own businesses.

Mr Obama will preside over the potential restructuring of all our
systems, some of them in ways he and his supporters have not imagined.
We haven't begun to see where fate will take higher education, but my
guess is that it will no longer be a "consumer" activity, and that the
hypertrophied land-grant diploma mills will have to to shrink or die as
state financial support withers away, and all sorts of unnecessary
professions from "public relations" to "marketing" cease to require
certified graduates. The luxurious central high schools, utterly
addicted to their yellow school bus fleets, will be left as a problem
for the states and municipalities. I don't believe they can be rescued,
and they are already failing in many other ways, not least, educating
and properly socializing young humans.

In the months just ahead, Mr Obama will certainly be swamped with
straight-ahead cash problems in every area of American life, from the
foundering pension funds to the bankrupt state treasuries to the
beggaring corporations to the starkly dispossessed and hungry masses of
the jobless and re-poed. I wasn't kidding when I came up with the label,
"the long emergency", to describe the storm that we are heading into,
along with Mr Obama. Of course, the current president - and Mr Obama has
been shrewd to point out there is only one president in office at a time
- has more than two months to wreak additional havoc in the financial
system. Right now, he's asking Mr O, "... do you want fries with that
sandwich I made for you?"

_____

My new novel of the post-oil future, World Made By Hand, is available at
all booksellers.

http://jameshowardkunstler.typepad.com/clusterfuck_nation/2008/11/presto-change-o.html


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