When the western world sanctioned Russia they expected Russia to collapse. It didn’t. The first reason is that most of the non-western world didn’t cooperate with the sanctions, but the second is simple: Russia has a food and fuel and mineral surplus.
The world as it stands now is every inter-dependent. The supply networks are dizzyingly complex and a final item like a car is made up of materials and parts extracted, made and assembled in dozens of locations.
The world isn’t always this way: it was like this in the late 19th, but after WWI that changed and the era of free trade ended, collapsing in particular during the Great Depression. The world did not become as “free trade” as it was before WWI again till the early 21st century.
But we are in a period of collapse. The peak, I would guess, will be seen to have been 2020, though different parts of the world economy will peak at different points (peak conventional oil was 2005, fracking and shale oil is not as good.) There will be water peaks, food peaks, peaks for various minerals like copper and so on. There will be a population peak, which will occur after a lot of other peaks. One model, which has been pretty accurate in general terms, is the Limits of Growth model, which regular readers will be familiar with:
Now the thing to understand is that as resources become genuinely scarce rather than simply distributionally scarce (we have more than enough food and have for a long time but people still go hungry) countries will stop trading away what they need and will move to more restricted trade. “We have excess food, you have excess minerals, we will trade with you for this, but we are not selling food generally on the world market to just anyone.”
In periods of genuine shortages, countries stop trading indiscriminately. Food riots are one of the main causes of government collapse and elites losing their lives. Running out of heating or cooling fuel or fuel to run the distribution network (diesel is probably near peak) can lead to fast internal collapse, and so on.
So when there isn’t enough, you stop playing around. You don’t trade unless you’re getting something concrete you need. If you need something, don’t have enough of it and either can’t or would rather not trade for it and still can run your military, you send your military to go get it. (This will become harder and harder though, as modern militaries are resource hogs.)
We’ve had a world economy for a long time now: most of the world since 45, virtually all of the world since the collapse of the USSR (and even before that the USSR, which had food shortages and petroleum to sell, was in the world market.)
Increasingly we will not. Some of this is driven, right now, by competition between the West (which includes S. Korea, Japan and Taiwan) and China, but even much of that is, I suspect, shortages in drag. Soon it will just be “there isn’t enough, who is going to get it?”
Take a good hard look at where you live and what it can make and grow and dig up itself, and how well it can be defended. Because that is going to matter even more in the not-so-far future.
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StewartM
Our predicament originates from a flaw in classical economics regarding free trade going back to Ricardo (though in fairness, you have pointed out that Ricardo actually thought of ‘free trade’ on a much more local scale, saying that it was absurd to think that Russian producers could practically compete with English ones). From Wikipeida:
Ricardo recognized that applying his theory in situations where capital was mobile would result in offshoring, and thereby economic decline and job loss. To correct for this, he argued that (i) “most men of property [will be] satisfied with a low rate of profits in their own country, rather than seek[ing] a more advantageous employment for their wealth in foreign nations”, and (ii) capital was functionally immobile.
(Boy oh boy, did Ricardo misjudge the Ayn Rand class so)
But a better model than classical economics for what we are seeing is biology. When natural obstacles are removed that prevent populations from traveling from one land mass to another, or one ocean to another, what you have is ecological catastrophe. The result is mass extinction, and the resulting ecosystems are greatly simplified (Simpson’s Index). Simplified ecosystems are more fragile and more likely to collapse.
https://en.wikipedia.org/wiki/Diversity_index
(My introduction to this came from dinosaur paleontology, and how from the meager data we have, dinosaur diversity was in decline in North America at least, by comparing late Cretaceous fossils at the Judith River site (well-diversified) vs the Hell Creek site (where 80 % of the fossils there come from just Triceratops Horridus . A classical economist would look at this and rave about the ‘efficiency’ and ‘superiority’ of Triceratops Horridus while a biologist would say “this ecosystem is teetering on collapse”).
I would also add (and this worries me) we move to a global language (English) and as a believer in the weak variant of Sapir-Whorf, this means our global thinking will converge and we’ll all accept unthinkingly the biases of English. For libruls celebrating ‘diversity’ (which, sadly, they really don’t) this means a loss of cultural diversity as well.
different clue
This could also apply to regions within countries. For example, I live in Great Lakestan ( on the “American” side). That region will have some food and water capability after some other regions no longer do.
( There is a whole bunch of Great Lakestan on the “Canadian” side of the “border” as well as on the “American” side. If the next few decades corrode and degrade “Canada” and “America” into delamination, one wonders whether a ” Federated ProvinceStates of Great Lakestan” will emerge. By the way, one also wonders if a Little Maritime Republic will emerge encompassing America’s New England states and the Canadian Maritime Provinces. One wonders further if Newfoundland, after decades of stewing in its own bitter memories of Confederation, the Loss of the Cod, and etc, will say that the only way it would ever join such a Little Maritime Republic would be if it gets to name and dominate the Little Maritime Republic . . . . something along the lines of, say – – The Atlantic Republic of Greater Newfoundland or some such thing.)
Ian Welsh
Back when I was at BOP in the early to mid 2000s I wrote a longish article on Ricardo, comparative advantage and capital flows.
https://www.ianwelsh.net/ricardos-caveat/
Bill
You are always good.
As someone who lives on Vancouver Island, we produce about 5% of our food from our own resources [more if you count prairie grain and hay], we have no oil or gas and our coal mines have shut. All our forests are just tiny trees compared to 50 years ago and logging trucks travel long distances with a load of 60-120 these tiny trees. People seem more concerned about sun and holidays than what is going on, such as the kelp around our shores are ‘boiling’ to death and almost no fish left, especially the most sought after salmon. We are at the end of all supply routes – good luck to everyone.
Feral Finster
Some years back, a libertarian in Argentina wrote some interesting notes about how to survive when TSHTF. “Mad Max”, it wasn’t, not exactly. There were people who tried to go all Road Warrior, but they didn’t last long. And this guy was a full-on gun nut.
I also read some things from people who lived in Bosnia during the 1990s. The persons who survived and thrived were the ones with community ties (meaning “local people that they can call upon for help when needed”) and marketable practical skills, as in “sewing” or “farming” or “carpentry”. People who fled the wars in Eritrea tell me something similar. One couple actually did quite well in a refugee camp, organizing and distributing deliveries.
Also, you can never have too many tarps. Tarps are useful for many things. Gold and cigarettes are always fungible and in demand.
Ian Welsh
Bill, One of my “Uncles” was a farmer, fisherman and hunter on Vancouver Island (Nanaimo). I sometimes worked as a deckhand on his boat back in the 80s. Even then there were a lot less salmon (he grew up in the Great Depression, so had seen the long decline.) Vancouver Island is shit to farm, as a rule. I used to help sometimes, and a lot of what I did was pick up rocks after tilling. He had a HUGE pile.
Feral Finster: yeah, it’s social ties, social ties and social ties. Real skills you can trade are good, too. Sometimes that’s not entirely what it seems. A friend of mine’s father in the Great Depression traded lawyer stuff for eggs and whanot from farms.
I would think that learning how to make antibiotics might be useful, too. Sulfa drugs aren’t too hard from what I understand, either.
mago
Running a Seattle restaurant kitchen from 1980 to 82, purveyors delivered 25 pound king salmon in rigor mortis 24 hours out of the water.
In September chanterelle mushroom hunters with their private patches showed up at the back door selling their pickings.
Cray fish harvested from Lake Washington showed up.
(To this day I cringe in remembrance of how we cooked them alive after tearing out their poop chutes, just as we de bearded mussels and tossed them alive in boiling beer.)
But I digress.
During my NW years I also foraged nettles, mugwort, watercress and blackberries, of course.
While that’s history, the NW remains fecund. It can come back around, but the salmon is going to take a good long while. Or maybe not.
Antibiotics and sulfa drugs?
Better back to the basics with concentrated herbals.
Might be advisable to grow poppies as well.
There are places and pockets where the causes and conditions are conducive to surviving collapse.
A clean reliable water source is critical.
Of course, the complexity and interconnectivity of conditions is beyond casual comment.
I just got sparked by Ian’s comments about salmon fishing adventures and sulfa drugs. Thanks!
Kfish
India’s just cut back on its rice exports for this exact reason.
GrimJim
The issue with the estimates from the Limits of Growth is that they do not take into account global climate change.
While they had inklings that something was going to happen back then, most bets were on a new ice age, die to the limits of data at the time and early modeling. And none of that, AFAIK, was taken into account in Limits.
So we are looking at charts that are using bad data. Data based on harvests and extraction and transportation levels that no longer obtain, or at least, cannot be continued at the projected levels nearly as long as was expected.
We are about to hit the first serious discontinuity due to rising heat in air and water. That will cause the fragile system to break faster and harder than expected in the model. I’ve no way to run the numbers as they did, but best guess is that all of those drops are going to be far more precipitous, and in the case of population and services, drop much sooner than was expected.
The entire global economy has been running on smoke and mirrors since before the start of the Great Recession. It will be interesting to see what’s really there once the smoke clears and the mirrors shatter…
NR
Ian, I think your last paragraph isn’t quite right. What you need to be looking at isn’t what the place where you live can make and grow now, but rather what it will be able to make and grow in the near future as climate change gets worse. Now it’s probably impossible to predict some of this, but we can draw some conclusions based on what we’re observing today. For example, parts of Arizona are probably going to be uninhabitable in the near future (we already have people getting very serious third-degree burns when they pass out and fall down because the asphalt is so hot).
The overall point is sound, but I think this is an important distinction.
Curt Kastens
Those areas where food can still be grown in realiable quantities in the near future are obviously going to be plagued by hordes of 150 pound locusts will wlll devour any food that the locals manage to grow. The locals may arm themselves and form militias to protect themselves. But with supply chians down they will run out of ammo before they run out of locusts to shoot.
Not only that, I can imagine a 13 year old girl (certianly not a 13 year old boy) who is well informed and has also been indoctrinated in Christianity, saying look here , we can contnue to kill these locusts, we are afterall defending our own food supply. But how much time is this going to buy us? We are killing locusts that are just trying to survive, just like us. But does God not teach that when a battle is hopeless the killing should stop and the struggle conitune by other means. How much more valuable are our lives compared to the lives of others anyways?
I can imagine such a 13 year old girl but I do not think that it likely to happen that anyone listens to her because such people who place survival as their highest value operate on automatic pilot.
But I do not think that there are many readers here though that will join such militias.
I just wanted to point out that their guns and ammunition will not save them. We can take comfort in the fact that they, and their twisted implicit value, that freedom means the right to economically exploit others, shall not inherit the earth.
Ian Welsh
GrimJim, agreed. The Limits To Growth stuff has tracked well up to now because climate change hasn’t been causing a lot of issues. It’s about to and that makes Limits To Growth the “best case scenario.”
StewartM
NR
For example, parts of Arizona are probably going to be uninhabitable in the near future (we already have people getting very serious third-degree burns when they pass out and fall down because the asphalt is so hot).
I actually have a friend who is going to move an elderly relative from Arizona (the A/C in her house is kaput, so the owner is going to sell). But really, anyone who move(s)/moved to the Desert Southwest, or to Florida, anytime during the last three decades should have their head examined. In the first case it’s the heat and the lack of water, and in the second it’s the (humid) heat (possibly even more dangerous) and the place will be *underwater*.
I realize a lot of these are/were the olds, but even then, as you age you become less able to deal with heat when you get older too. So I don’t get the ‘for your health’ argument.
different clue
@StewartM,
I remember some years ago ( don’t remember how many), that a semi-elderly cousin of mine and her husband were going to retire from Massachusetts to Phoenix, Arizona. Well, at the time they were just strongly thinking about it and probably going to do it.
I was able to talk them out of going to Arizona based on expectations of future water shortages and Water Riots. Did they think they would survive the Water Riots?
So they moved to Florida instead, which was not as dangerous as Arizona and is still not as dangerous as Arizona. The end for most of Florida will arrive slowly, like a slowly rising flood. And at their age, I think they will peacefully die before Florida does. I think the biggest danger in Florida is a social danger . . . the strong possibility that the DeSatanists will be able to turn Florida irreversibly into a Gilead Republican State. In which case , the several-million-strong first wave of refugees from Florida will be social-political-cultural non-MAGAfascists in flight from MAGAfascist oppression and persecution in DeSantistan.
That could present an opportunity for the Global Warming Realist Community to help organize and even subsidise the migration of millions of Global Warming Deniers to Florida in such a way as to subsidize the departure of millions of non-DeSatanists ( who also tend to be Global Warming Realists ) from Florida. Help them sell their houses to Global Warming Denialists who want to live in the No-Mask Freedumm Gilead Republic of DeSantistan.
Quite Likely
Huh, 2020 to be seen as the peak? I’ve been thinking of that year more and more as a bit of a nadir, after which things have been slowly but steadily improving. We’re out of the pandemic and almost out of the resulting disruption to the global economy, increases in renewable energy production are going exponential, the labor movement is resurgent… what’s not to like? You’re veering a bit too hard towards unrealistic doomerism these days, the world has big problems but it’s going to keep muddling through, there’s no collapse on the horizon.
anon y'mouse
as poverty now is disproportionately distributed, so will your “model” be.
the OverLords of Ireland continued to export food and fuels from Ireland during the famine that drove population offshore. so even though they “could have” stopped trading in this vital resource to shore up the domestic pop., they did not and preferred depopulation and to continue making money.
and it will be that way here in USA since tons of what we export is making money for MassAg on both ends (selling as food for animals abroad who are to be food).
why else is there suddenly huge food inflation?
people may disagree with me, but i personally experienced this as a ghetto dweller in CA during my own lifetime. good luck getting good fruit and veg that wasn’t being sold down a disused road out of the back of a truck. the OverLords of CA were sending all that good produce out, or to the highbrow Whole Foods type places in the rich part of town that most of us poor types didn’t go to for various reasons (price, distance, it not being “our place”) but for us, the sadder grades of imports from LatAm and SouthAm on offer. i have had people argue with me about this, and i would guess they were the Berkeley Bowl shoppers that never went to ghetto East Oakland grocery stores.
one used to be able to rectify this somewhat by going to small produce marts owned primarily by Asian shopkeepers, but those are almost gone now.
so, that’s why many of us just resort to boxed food. well, that and time constraints.
sorry to drag the story afield, but I can’t stop the tangential flow.
Jan Wiklund
Talking about “resources” without any qualification seems like neo-classic economics turned upside down. Neo-classics believe everything is the same, i.e. being completely interchangeable, with money as a medium. So also degrowthers. But “resources” are of very different kinds.
Some resources are finite, others not. Some resources cause poisoning when consumed, others not. Some resources can even be produced. Other resources are really interchangeable, i.e. one can stop using one and instead use another. One should take care to figure out which is which before claiming that “we run out of resources”.
Forecasting Intelligence
Hi Ian,
What’s your take on Europe? I live in the UK and getting a tad nervous about the future of Europe that looks frankly grim.
Greer is v negative about the continent.
Ian Welsh
Forecasting:
https://www.ianwelsh.net/the-uk-continues-its-decline/
https://www.ianwelsh.net/as-the-sun-sets-on-the-united-kingdom/
https://www.ianwelsh.net/the-destruction-of-the-united-kingdom/