Monday, July 28, 2008

Re-Post: Hamlet Economy

Here's the last re-post before (original here) I return to new content, one of my favorites from that past, and a good intro to the potential for what I call rhizome, others call "networked villages" or "resilient community."


The goal of this post is to outline a concrete framework for establishing a new economy based on rhizome structure that provides negative feedback against encroaching hierarchy, that ensures environmental sustainability, and that maximizes its compatibility with human ontogeny. I will first outline my approach to the problem, then look at one historical example—how the lattice network of Tuscan hill towns created a topology that addressed its unique circumstances, then analyze the optimal theoretical topology of a modern rhizome economy, and finally discuss some real-world concerns for the conscious design and establishment of a new hamlet economy.

Part 1: Methodology

This post aims to take the theoretical structure of rhizome, and flesh-out how a real-world economy will be built upon that model. Rhizome, in short, is defined as a non-hierarchal network of self-sufficient but interacting nodes. Within the context of a hamlet-economy, defining the threshold of self-sufficiency is the key theoretical step. It would be unrealistic to suggest that each individual be totally self-sufficient—while perhaps possible, it would result in an unacceptably low standard of living, as well as lack the resiliency necessary to prevent the accretion of hierarchy. It would be equally unrealistic to place the threshold of self-sufficiency too high, for that would create uncontrollable dependencies internal to the economic structure that would trend, eventually, towards a kind of feudal hierarchy. The exact location of the threshold of self-sufficiency may vary, but it must be at the lowest level, under the circumstances, that can:

1) Leverage the de-facto division of labor without dividing the knowledge to perform that labor. This permits raising the potential standard of living above individualized self-sufficiency, without creating dependency on the knowledge of another that can lead to hierarchy and exploitation.

2) Provide adequate redundancy to absorb sufficient systemic shock. For example, if self-sufficiency is placed at a level of two-person groups, then in the face of a shock that incapacitates one person, the other must absorb the full shock. Similarly, because this model will be based partially on horticultural modes of production, it must have enough diversity that it can absorb failures of certain crops or resource production processes brought about by weather, disease, etc.

In this model, I have placed the threshold of self-sufficiency at the familial group level. This threshold leverages the existing, biological human tendencies toward kinship, and creates a basic rhizome node that consists of roughly 10-40 people, or about 4 extended, nuclear family units.

The mode of production for this model is a hybrid of horticulture, gathering and hunting, with emphasis on a highly diverse system of horticulture (based on permaculture, fukuoka, and forest-garden concepts) to maximize standard of living, but with continual maintenance of significant spare capacity (geographic space and knowledge) to both hunt and gather to act as an absorber of systemic shocks.

Finally, the issue of specialization and specialty production must be addressed, where each node, in addition to providing minimal self-sufficiency for themselves, also produces one or more specialized product to facilitate economic interaction with other nodes, as well as to leverage the communication and information processing capability of rhizome to organize economic interaction in a way that generates much higher standards of living than can each node on their own. This latticed economic interaction is the glue that holds together the rhizome structure, ultimately serving as the strongest defense against encroachment by hierarchy—a single node cannot likely hold out against expanding hierarchy, but a well connected rhizome society of nodes can.

Part 2: Topology Lessons from a Tuscan Hill Town

This discussion of nodes and lattice is all very theoretical—it can be difficult to envision how it would actually take shape in the “real world.” For that reason, an extant, historical model that illustrates many of these concepts is useful. Tuscan hill towns are an interesting example—certainly not a perfect example of rhizome, but they are a decent example of a networked economic topology that consisted of many relatively self-sufficient nodes. They are, as with all vernacular physical geography, a unique product of their circumstances: fertile terrain punctuated by rough forests and hills, Mediterranean climate, an ancestral fabric of small farms, and a disintegration of rule by outside powers that led to the many social, economic, and technical innovations of the Italian city-states. My personal favorite is Lucignano, a relatively small and insignificant hill town depicted below. I will use it as the model hill-town for purposes of this discussion, so take a moment to familiarize yourself:

Figure 1: Here’s a map of Lucignano. Note the defensive arrangement of the housing and the patchwork of small fields.

Figure 2: Here’s an artist’s sketch of Lucignano…both the map and the sketch below depict the town in its modern form, which as far as I could tell hadn’t changed much in several centuries.

Figure 3: A picture of Lucignano that I took from the Fortezza Medicea (see map above) where I stayed for a week in May of 2002.

I trust that you’ve enjoyed your brief virtual-tour of Lucignano…

It is interesting to note the impact of the continual wars between Florence, Siena, and other renaissance city-states in Italy on the architecture of the classic Italian hill town. Is this kind of inward-looking, defensive posture necessary in an envisioned future? Can a more open design, oriented to capture passive solar possibilities, be viable? What sizes of settlements are necessary—small familial farmhouse clusters, hamlet clusters of families oriented for convenience or defense, or trading or craft-industrial villages that produce local specialty products? In the case of Lucignano, many or most farmers lived within the defensive walls and walked to their fields each day. Additionally, the degree of hierarchy—resulting from the high-level threshold for self-sufficiency (which was located at the level of the hill town—in this case over a thousand people)—was certainly not optimal. The specific architecture and economic structure will vary by climate, resources, level of defensive need, etc., but the basic network structure of the hill towns remains instructive: the hundreds of hill towns that dot the map of Tuscany formed a powerful and resilient network of localized economic interaction. Today, this same region is demonstrating a resurgence of the very kind of sustainable, “fulfilled ontogeny” economy that is the goal of this model, even though it exists within a largely hierarchal and industrial society. The “Slow Food” movement was, in fact, initiated by the mayor of Greve-in-Chianti, one of the more famous hill towns of this region, and is now spreading around the world. Finally, and perhaps most importantly, the Tuscan hill town is an important symbol of the “good life” that may ultimately be achieved through this kind of rhizome economy—it is something that is desirable even within our modern culture, that can be readily understood, and that promises not “a return to the stone-age,” but a positive vision of “moving forward with an eye to the past” that is nearly universally preferable to the experiences of modernity. Since this can be such a difficult theoretical concept to sell, the ability to relate it to a well-known example is invaluable. There are certainly other examples, but within Western culture, this one may carry the most weight.

Part 3: The Optimal Topology of Rhizome and the Hamlet Economy

Rather than try to explain the optimal topology of a rhizome structure in words, I will try to more effectively illustrate this structure in the captions of the following graphics:

Figure 4: The above illustration is the theoretically optimal topology for a single rhizome node, representative here of a familial cluster. Close and strong connections exist within the node, representing the connectivity inside the extended familial group. Outside links are variously looser and weaker connections, the closer connections with the local hamlet, and the distant connections creating inter-hamlet ties, and creating the “small-worlds” situation where weak and distant connections greatly enhance the overall efficiency of connectivity. The green region denotes the geographic space required by the node to achieve minimal food self-sufficiency.

Figure 5: The above illustration shows a hamlet, or a cluster of familial nodes. The groupings in terms of 4:4:4 is not fixed, but merely a convenient way to convey a flexible structure. Close and strong connections exist within the hamlet, and variously looser and weaker connections reach outside, replicating in a fractal manner the same “small-worlds” theory as seen in individual nodes. The larger, lighter green region represents the geographic space required for “wildlife, hunting, and foraging,” or permaculture’s “Zone 5,” which is controlled “in trust” by the hamlet for their non-exclusive use, but available for their use as a reserve-bank should their horticultural scheme underperform.

Figure 6: The above illustration represents the broader landscape of a lattice-structure of clusters of rhizome nodes. It represents a theoretical distribution, and demonstrates that there are no “super-hamlets,” towns, or villages—the landscape is “flat” at the hamlet level, because any accretion to a higher order settlement would open the door to hierarchy. Instead, more complexly coordinated functions are facilitated by temporary groupings, as shown in the next illustration.

Figure 7: The above illustration denotes the ability of transient connection, fairs, festivals, etc. to affect longer-distance, weak connectivity that greatly enhances the overall efficiency of the lattice’s communication and information processing capability. Because more distant nodes are brought in contact with these occasional events (shown as dashed blue, red, or purple lines), the number of nodes that information or exchanges must transit to span large distances is greatly reduced (as illustrated by the black line transaction, where only two steps are necessary to bridge a distance that would otherwise require 8 steps in neighbor-to-neighbor transfer). These larger, weaker, and transient networks facilitate more complex activity and more specialized economic exchange without facilitating hierarchy. For example, even if only one node in 50 actually breeds goats or brews beer, all 50 nodes will have easy access to these products through seasonal fairs, transient markets, etc. In theory, there is no limit to the technological or industrial complexity that can be handled by such transient groupings of a still “flat” rhizome lattice. This format prevents more complex projects (defense, highly specialized goods like metal working or glass, social richness) from acting as a catalyst to the creation of hierarchy.

Figure 8: The orderly geometric lattice structure must, in reality, be draped over the natural geography, to include terrain, climate, resource distribution, etc.—as illustrated above with regards to a simple topographical map. While the theoretical and geometrically symmetrical lattice illustrated in Figure 6 provides easier initial conceptualization, the lattice illustrated in this figure is more realistic. In reality, several different “conceptual terrains” will each simultaneously impact the actual geospatial structure of the lattice. For example, physical terrain, difficulty of travel, resource concentrations, water availability, soil richness, etc. will all influence the layout.

Part 4: Reality, and the Implementation of a Hamlet Economy

Real-world implementation of this conceptual “hamlet-economy” requires efforts to guarantee resiliency, coping with the existing built landscape, and achieving coordination and standardization of this fractal pattern without a top-down hierarchy.

Rhizome lattice is great, in concept. However, if it does not demonstrate adequate resiliency, it will only last until the first major systemic shock—and systemic shocks have always and will continue to impact humanity, from weather, war, technology, famine, disease, etc. The hamlet-economy fosters resiliency by using long-time-horizon resource cultivation techniques, as well as planned redundancy in resource cultivation. For example, the forest garden concept is illustrative: while all horticultural and agricultural schemes vary in annual return, failure of a forest garden scheme one year does not propagate failure in future years. With a forest garden, after establishment, large quantities of resources are stored and available for harvest to make up for shortfalls in other areas. Similarly, maintenance of spare capacity in foraging and hunting, used only minimally in years where horticulture produces well, provides a safety net for years when horticulture produces poorly. This built-in redundancy is critical to maintain the viability of horticulture—along with its normal benefit of increased standard of living—through years when horticulture performs poorly.

It is also important to recognize that the implementation of this kind of hamlet-economy will, in most circumstances, require adaptation of an existing landscape—in most cases a landscape that is not sustainable, that is hierarchal, and that is not compatible with human ontogeny. This introduces an artificiality, in the sense that the theoretical structure may be impacted by existing hierarchal infrastructure (like towns and highways). Perhaps the best way to circumvent this is to begin to “plant the seeds” of a hamlet economy in existing rural areas, and then expand into prior towns and cities as they become non-viable.

Finally, it is important to address the issue of enforcing this structural pattern without utilizing top-down, hierarchal means. One key tool in this effort will be the use of open-source arguments to explain and justify the reasoning behind adapting this pattern—such as, hopefully, this post. Another will be the use—perhaps in modernized format—of the traditional norm enforcement tool of myth. Stories explaining the pitfalls of straying from this basic structure will help to keep the core principles intact. Finally, and I think most importantly, the success of this theoretical structure will depend on the ability of the pioneer implementers to demonstrate that it provides a better standard of living than other structures. If the average American could live the “good life” of living in a stereotypical Tuscan villa, and if they are shown how they, too, CAN have this lifestyle, then people will literally flock to this structure. Ultimately, this is a POSITIVE vision of the future—not a reversion to feudal serfdom, but a progression to a more egalitarian and human-compatible life…

Wednesday, July 23, 2008

Head Fakes, Demand Destruction, and Net Exports

Oil is down to about $124/barrel. Apparently we're saved, as demand destruction is making gas cheap again. $124/barrel certainly wouldn't have felt like good news three months ago, but there you have it. Is this actually good news? Here are a few quick items to consider:

Head fakes are dangerous. Whether this price drop lasts a few weeks or a few years, it will have the tendency to lull the world economy into a dangerous sense of complacency. I guess we don't *really* need to address the energy problem, as oil is back down under $130/barrel (or under $100/barrel, or under $80/barrel). Then we continue to calcify our energy demand requirements as geological depletion marches ever onward. A price retracement increases the chance that we get caught unprepared facing the cliff on the far side of the undulating plateau of peak oil production.

Net exports continue to decline, down by another 90,000 barrels or so from May '08 to June '08.

Demand destruction keeps getting harder, while geological doesn't slow down. America still has lots of "low hanging fruit" to pick in the form of reduced consumption and energy efficiency, but each subsequent measure is more difficult, more inconvenient than the one before it (otherwise we would have chosen that one first).

Lower oil prices have the potential to boost a flagging consumer economy, and help America get through the "credit crunch." This might seem like a good thing at first--and in many ways it is. The credit crunch is a solvable problem--get rid of the irrational loans, stabilize the credit system, and there is no financial impediment to continued economic growth. BUT... continued economic growth means continued increase in ability to afford oil (even at current high prices), which will slow demand destruction and may ultimately exacerbate the problem. As counterintuitive as it seems, $200 oil by late this year probably makes $500 oil further away than $100 oil by late this year. I wrote about this in "Timing: The Credit Crunch & Peak Oil."

Finally, as I wrote last week, it really comes down to whether emerging markets can keep up their demand growth. If we accept a 5% rate of decline in production post-peak, the US can probably keep up that rate. It would be difficult for our economy and society to decline at a 5% rate year after year--the first few years would be easier, but it would get increasingly difficult--but it seems very possible by improving vehicle efficiency, increasing the use of electrified rail, etc. However, the US only uses 25% of the world's oil, so if we can match the 5% decline rate that doesn't get the world out of the woods. The rate of WORLD consumption must match the rate of world decline in production. As of now, there is no sign of demand destruction in India, China, Russia, or the third world in general--there are some signs of reduction in the rate of growth, but that is NOT the same thing. IF India, China, and others can hold non-US consumption flat (a big IF), then the US would have to decrease consumption at 20% per year to match a 5% global rate of production decline. That would be tremendously difficult--that equates to 4 million barrels per day less use the first year, 3.2 mbpd less the second, etc. until the US is only using 6.55 million barrels per day after 5 years--less than 1/3 our current use.

It will be interesting, to say the least, to see how things play out. I think that the best scenario is for a steady and slow increase in the price of oil. Unfortunately, what I think is more likely is a scenario where the only thing increasing more rapidly than the price of oil is price volatility. $200/barrel still won't surprise me this year, but neither will $75, or even one followed by the other in either order. Higher volatility makes it more difficult for consumers and voters to properly understand the nature of the problem that we face, and easier to blame some scapegoat. As I mentioned above, $3 gas by election day makes $10 gas likely to happen much sooner than if we have $5 gas by election day...

Monday, July 21, 2008

Algeria & Morocco: Natural Gas Cartels, Fertilizer Mercantilism, and Rising Tensions

This originally appeared last week at The Oil Drum. I may have a brief, original post this week if time permits.


Algeria is one of the world’s most important oil and gas exporters. Morocco has no significant oil and gas production, but has about 2/3 of the world’s rock phosphate reserves, a critical component in global fertilizer supply that increased 300% in price in the past year (.pdf) and may peak alongside global oil production. The two nations have historically been at odds, especially over the phosphate-rich territory of Western Sahara. Now, more than ever, their exports are critical to the energy and food supplies of the world. Alongside increasing importance, tensions between the two are on the rise as the US and Russia provoke the situation with massive opposing arms deals and bi-lateral trade agreements. This article will look at the forces behind these rising tensions and consider issues of fertilizer mercantilism, infrastructure vulnerability, and the potential formation of a natural gas cartel.

will gas and fertilizer bring conflict to North Africa
Will Demand for Gas & Fertilizer Bring New Conflict to Morocco & Algeria?

Country Briefs:

Algeria: Algeria is an important exporter of both oil and natural gas (background .ppt on NG supplies to Europe). Algeria is Europe’s third largest supplier of natural gas, providing 30+ bcm via pipelines and 20+ bcm via LNG tanker in 2007. Major projects are currently underway to expand pipeline infrastructure to Italy (via Tunisia) and to Spain (both direct undersea and via Morocco), and to expand LNG export capability. Algeria hopes to expand total natural gas exports to 85 bcm/year by 2010, making their production roughly the equivalent of Norway (Europe’s 2nd largest provider). Significantly, the potential to expand natural gas supplies to Europe enhances Algeria’s importance as an alternative supplier in light of current dependence on uncertain Russian gas supplies. Algeria also faces an active Islamist insurgency, a separate threat from the rising al-Qa'ida in the Land of the Islamic Maghreb, and serious demographic challenges in the form of a 1.22% population growth rate (graph) and sharp ethnic divisions (map).

Figure 1: Algeria's Place Among African Natural Gas Reserves

Morocco: Morocco's importance to the global economy is due to its control of at least 2/3 of the world's reserves of rock phosphate. The USGS has stated that there are no substitutes (.pdf) for rock phosphate in agriculture. With biofuel demand increasing steadily, and world food shortages hitting the headlines, rock phosphate is arguably as important to the world situation as oil supply. Importantly, Patrick Dery has performed a Hubbert Lineraization on world phosphorus production and estimates that we have already passed peak phosphorus (see graph below). While the importance of rock phosphate has been discussed here before, its impact on the situation between Morocco and Algeria has not. Additionally, fertilizer supplies are a critical component of many biofuel projects, creating an interrelationship between phosphate and energy supplies. Like Algeria, Morocco faces an internal Islamist insurgency (though currently less troublesome than in Algeria) and has significant demographic challenges with a population growth rate of 1.6% (graph) and sharp ethnic divides (map).

Figure 2: Peak Phosphorus? A Hubbert Lineraization of Global Phosphate Production

Tensions: The Sand War, Western Sahara, and Islamist Insurgencies

There are several sources of tension between Morocco and Algeria. The two states fought the Sand War from 1963-64 over a mineral-rich border territory. In 1975, when Morocco took control of Western Sahara, Algeria began overtly backing the Polisario Front in an ongoing insurgency that continued unchecked until a 1991 cease fire. Both states also suffer from internal Islamist insurgencies, exacerbated by increasing demographic problems. The situation in Algeria is most severe: after independence from France, the revolutionary National Liberation Front ruled the country until Islamists won the first free elections in 1991, prompting the military to immediately seize control. More than 160,000 people were killed in the ensuing civil war between 1992 and 2002. While the country is relatively peaceful today, factions of the Islamist rebels have remained, operating out of rural regions inside the Malian border and elsewhere in the Sahara, and have recently merged with al-Qa'ida to form AQIM (al-Qa'ida in the Land of the Islamic Maghreb). The group has recently carried out several attacks in Algeria, including the April 11 2007 Algiers Bombing, the December 11 2007 Algiers bombing, the 2007 Batna bombing, and the 2007 Dellys bombing, as well as being possibly involved in the 2007 Casablanca bombing in Morocco. The pace of attacks has not slowed, with at least five bombings in the last two months alone.

Infrastructure Targeting?

While Algerian Islamists have generally mirrored target selection of Islamist groups elsewhere, one attack in December, 2006, specifically targeted Haliburton workers in Algeria. This tactic, of targeting critical infrastructure and energy industries, has been increasing around the world as non-state groups everywhere realize that they can maximize their return on investment with these targets. With rising internal threats and state sponsored proxy conflicts, and the potential for direct state military attacks no longer too remote to consider, it is concerning that both Algeria and Morocco present some extremely high ROI energy and resource infrastructure targets:

- Morocco: The Fosbucraa Conveyor, the world’s longest conveyor belt, transporting phosphates from the world's largest phosphate mine at Bou Kra 100km to the port of el Aioun. The conveyor was successfully attacked several times by the Polisario Front. Here's a satellite image.

- Algerian pipelines & LNG infrastructure: Algeria is chock full of high-vulnerability, high-consequence targets. Algeria recently signed a 100 million euro contract with French defense firm Thales to secure oil and gas pipelines. With 16,200 km of major pipelines to protect in Algeria alone (and scheduled to increase to 21,000 km by 2010), the task is daunting. Additionally, two potential future infrastructure projects may represent appealing targets. The proposed Trans-Saharan natural gas pipeline, that would deliver Nigerian natural gas to Europe via a 4,550 km pipeline, would represent a lengthy and vulnerable target to multiple groups if it is ever built (construction is “penciled in” to start in 2015). Additionally, speculative plans (such as the Trans-Mediterranean Renewable Energy Cooperative, or TREC) to leverage high solar insolation in the Sahara to generate electricity for Europe would require huge transmission infrastructure that would be both highly vulnerable and highly attractive. Neither the Trans-Saharan pipeline nor TREC is in any danger of being built in the immediate future.

Thoughts on the Future: Proxy Wars & Proxy Mercantilism

Recently, the fragile 1991 cease fire agreement with the Western Saharan Polisario Front has become increasingly unstable. Complicating the situation with Western Sahara, French President Sarkozy announced his support to Morocco's decision to postpone indefinitely the self-determination referendum promised in the 1991 accord, along with increased Algerian support to Polisario leadership. All this comes against a backdrop of rising military tensions between Morocco and Algeria. In 2008, the US doubled military aide to Morocco and announced arms deals worth billions of dollars. At the same time, various sources confirmed that Russian concluded a $7.5 billion deal to provide advanced arms to Algeria.

Is there any deeper meaning behind these moves? At least two possibilities must be considered. The first is proxy-mercantilism by the United States to secure control of phosphate supplies. In 2004, the US entered into a bi-lateral free trade agreement with Morocco. This can be explained as a natural extension of the long history of economic and military cooperation between the US and Morocco, but in light of proposed biofuel programs, skyrocketing rock phosphate prices, potentially peaking phosphate production, and mercantilist moves by other great powers, the more nefarious possibilities must be considered. The second possibility is that Russia hopes to leverage increased influence with Algeria to exert greater influence in global natural gas markets. Because Algeria is one of Western Europe's few true alternatives to Russian natural gas supplies, especially given the prospect of sharp increases in Algerian natural gas exports, Algeria represents either a threat to Russian natural gas leverage, or a great enhancement of that leverage by entering a defacto gas cartel. At a minimum, we know that Russia and Algeria are actively engaged in talks on this topic. Also, a recent offer by Gazprom to buy all of Libya's additional oil and gas production supports this suggestions that Russia hopes to control Europe's alternative sources of natural gas.

Both notions of phosphate mercantilism and a gas cartel are merely informed speculation at this point, but the stakes are so high that these possibilities must be considered. While there may be no deeper motive behind recent moves with Morocco and Algeria, at a minimum the stakes and tensions are increasing. Because both Algeria and Morocco are fragile Nation-States, with active Islamist separatist movements, significant internal terrorist threats, and complicated ethnic/territorial problems, the potential for interruption in critical exports of phosphate, oil, and gas is increasing.

Tuesday, July 15, 2008

Demand Bifurcation Point

The future of the global economy will, in my opinion, turn more on this question than any other:

Will demand destruction hit India and China, or will their oil consumption continue to rise?

The answer here will determine much of how peak oil plays out. It isn't a "tipping point" where we'll suddenly enter a post-peak world, or an energy-scarcity world. We're already there. Rather, this is a "bifurcation point"--a potential radical divergence in the impact that peak oil has on the global system.

If the Indian and Chinese economies are fragile--as many think--and can't continue to grow with $150 oil, then they will cut back on demand, and oil prices may stabilize as global oil demand stays in line with gradually declining global net oil exports. This will allow for a more gradual response to energy scarcity, a re-tooling toward renewable sources, new settlement patterns, etc. If, however, the Indian and Chinese economies are much more resilient than many think--as I think is the case--then Indian and Chinese oil demand will continue to rise rapidly, more than making up for any demand destruction in the more mature western economies. The result will be continued rapid price oil price increases, additional economic stress in the West, and greater turmoil in general. I think the answer to the question will largely turn on the vibrancy of internal consumer demand from the growing middle class in both states. It's simply too early to predict with confidence, but here's an indicator that suggests Indian and Chinese oil demand will continue growing:

China June Auto Sales up 15% Year-on-Year

That's 836,000 new cars in China in June alone. And, significantly, in China the majority of these new cars are the first car for an individual consumer--so these aren't replacing existing cars that were already on the road, but rather are new cars that weren't on the road before. In India, May auto sales were up 14% year-on-year to 110,000 cars--that shows how much room to grow India has just to catch up to China's level of automobile penetration in the populace! GM expects global auto sales to increase 4% in 2008, meaning 2.8 million more vehicles will be sold this year than last. Especially considering that sales in mature western economies are expected to stagnate or decline, the majority of these new sales will come in developing nations where they are disproportionately more likely to represent a new, additional car on the road, not a replacement car.

The prospects for global demand destruction are not looking good. Oil is a globally fungible commodity--demand destruction in the US may be rising very slowly, but this is irrelevant in the face of rising global demand. Personal investments in cars increase the inelasticity of demand--when people have sunk cost in a car, it skews their calculation on the value vs. cost of consuming gasoline. Unless the trend in global car sales turns around, it's hard to envision a long-term retreat in oil prices...

Monday, July 14, 2008

Vernacular Zen (re-post)

I'll post new content next Monday with a cross-post of an article on Algeria & Morocco that will soon appear in The Oil Drum. In the interim, here's a re-post of one of my favorite posts from 2004, and a much needed dose of denial-free optimism for these troubled times:

Vernacular Zen: Glimpses of "The Original Affluent Society"

I am an advocate of localization, simplification, self-sufficiency and fulfilled ontogeny. Slow food. Tribalism. A thousand other catch-phrases that, above all else, raise a singular objection from friends and critics alike: isn't your idealized vision starkly juxtaposed to your professed enjoyment of the finer things in life?

My response: on the contrary, my good friend...these worlds are in fact one in the same, only separated by the disinformation of the consumer economy.

Povero o Rico??
Is this an image of a "poor" fishing village or one of the worlds most exclusive resort islands? Actually, it's both--a picture of the idyllic island of Panarea (just North of Sicily) taken by the author while sailing away aboard the 38' sailboat "Fandango."

I have spent, to be perfectly honest, more than my fair share of mornings slowly enjoying an espresso as the fog burns off the slopes of Mount Etna in the distance, the scent of blood orange blossoms mingling with the sharp aroma of coffee. This is the kind of perfect moment that embodies our cultural ethos: sacrifice enough of what you love now, and you'll make enough money that some day you'll be able to buy back those priceless experiences in the form of a luxury cruise, a meal at that new bistro or a beach house in Florida. The irony is that this perfect moment cost about 65 cents--that's less than 8 minutes wage for a cashier at McDonald's, and yet it's enough to make highly paid executives and professionals alike salivate. This should tell us something...

The finer things in life can generally be divided into two categories: material and experiential. Despite the relentless psychological barrage of advertising, most of us can readily admit that it is the experiential that is truly rewarding and fulfilling. Many even recognize their own predilection to fulfill their desire for the experiential by compensating with an excess of the material. Commercialism tells us that the experiential--that which requires time--is too costly, out of our reach. Our time, we are led to believe, must be sacrificed to meet the demands of the economy. But time is free for all of us. It is the great equalizer, something to which we all have equally random access. But in the modern economy, where average individuals cannot directly provide for themselves, they are duped into trading time for the basic necessities of life--necessities that are directly available to the poorest of the Earth. As this economic hierarchy has intensified over time, we continue to be duped into trading our time for material possessions--far beyond those required to survive. The memes of our economic culture have convinced us that the material is a fine substitute for the experiential. A nagging doubt, dissatisfaction with our own suburbanization, some unknown, unfulfilled yearning tells us that, despire the overtures of mass-media, even the materially rich among us still long for the experiential.

The sun on your face, playing with your children, staring at a fire until late into the night, sitting still in the forest listening to the wind rush through aspen leaves, talking with friends, laying on your back in a meadow and watching the clouds pass above you. All of these things are free--they require only time. Hunter-gatherers around the world spend, on average, less than 20 hours a week "working". The rest of their time was available for the experiential, the "finer things" in life. Perhaps this is why anthropologist Marshal Sahlins calls them "The Original Affluent Society", or why Paul Shepard says that humanity's time in the "hamlet economy" was the best it ever had.

The finer things in life are nothing more than a connection and a oneness with those things that modern culture insists remain separate or "sacred". This connection is available to all of us. Reconnecting to the finer things in life is not dependent on success within the modern commercial economy...on the contrary, my good friend, this reconnection requires that we take a new--or is it old?--approach to life. This is vernacular zen.

Monday, July 07, 2008

We-Think & Rhizome Design

Limited posts for this Monday and the next two Mondays as I'm studying for the Bar exam on July 29th. As time allows (or the need for a study break dictates) I'll try to include something of substance.

This week, a follow-up on last week's post on rhizome platform design, I'm recommending the book "We Think" by Charles Leadbeater. The book, itself a product of open-source collaboration, details open-source design efforts around the world, from Wikipedia to the Grameen Bank (just for good measure, I'll link to Grameen Bank via Wikipedia...). Leadbeater is probably the world's leading thinker on the future of open-source collaboration, so, while he is not specifically focused on the core rhizome concepts of self-sufficiency, decentralization, and eliminating dependencies, his theories are potential sources of inspiration.

You can read the draft of his book free at his site, or watch his You Tube video on the topic. You can also buy it on Amazon, though I had to get my copy as a UK import--not sure when it will be available mass market in the US.