Last year I described thirteen economic, political and environmental crises that are long overdue, and which will almost certainly occur at some point in this century. These crises will be the result of our generation’s short-term thinking, greed, and mismanagement of the the economy, of power and of the Earth’s resources. Our actions, throughout the twentieth and early twenty-first century and to some extent even before, have been irresponsible, shortsighted, selfish and unsustainable. What’s worse, rather than accept responsibility for this behaviour, we have mortgaged the future to try to sustain our unsustainable lifestyle and actions just a little longer, in the misguided belief that technology or innovation will find some way to solve them, and allow rampant population growth and consumption growth to continue indefinitely.
The generations that will inherit the mess we have created over the next three generations should rightly be furious at us for doing so, but unlike the boomer generation, who rioted in the streets in the 1960s and swore to “never trust anyone over 30″, our successors have been sanguine, pragmatic, even timid about the challenges we have foisted upon them.
Recently, I was asked which of the thirteen interrelated looming crises I thought would be the first to occur, the first domino to fall, and when.
In answering this, I would offer a few caveats:
- Prognosticators have a long track record of overestimating the rate of change in the near future and underestimating the change over the longer term. Unlike many of the experts in economics, ecology, technology and social trends, I think the next twenty years or so will be merely tumultuous — the real crises, the ones we are unlikely to be able to cope with, probably won’t occur until the 2030s.
- This doesn’t mean that we’re not going to have some earlier previews of the crises to come, and some short-term improvements in some areas that might give us false hope that the longer-term problems had been solved. For example, we’re going to have a series of serious recessions before 2030, I think, but the next Great Depression will not likely occur until after then, after we have had some temporary respite from the smaller downturns. And while Peak Oil is inevitably going to make the price of oil unaffordable for almost all endeavours we now take for granted, we will see spikes and retrenchments of oil prices in the interim, in response to short-term events, that may blind us to the inevitable long-term energy crisis that awaits us.
- The longer-term crises that will prove to be our undoing are likely to be masked by short-term crises that will distract us from paying attention to them. The media will worsen this situation. Only in retrospect will we realize which of the burning issues of the day were the ones that were really important.
Because they’re interrelated, some of these crises will precipitate others, and our ability for forestall some of them will delay the occurrence of others. And the timing of some of them, like pandemics, is largely unpredictable — if they occur soon, they might cause some of these other crises to occur sooner than I’d expect, and if they occur later, they might delay the onset of others.
Having said that, here is my wild guess about when these crises will occur. I’d welcome your “second guesses”:
First Wave: Approximately 2010 to 2030
- Consumer Credit Collapse: After a brief upturn in the housing market in the US particularly, housing prices will plunge again as the orgy of consumer spending that has occurred since 1990 (see charts above) comes to a sudden halt, after a whole series of bank collapses cause a severe tightening of credit. Since 1970, in real dollars, per-capita total assets have doubled, financed entirely by debt, so that net worth of 95% of the population has actually declined. The apparent wealth of bigger houses, second cars and expensive furnishings is all an illusion, and the tightening of credit will throw all these overpriced assets into the market at fire-sale prices, and bankruptcies will soar. Between 2002 and 2007, $1.2 trillion of credit card debt was shifted into mortgages. With home prices falling further, that debt will be called, and added onto the expected $3.0 trillion in other credit card debt, carrying double-digit average interest charges, will crush millions of consumers.
- $US Collapse, US Debt Crisis and Trade Imbalance Crisis: Even the most optimistic economists have acknowledged that the US debt and trade deficit, each around $10 trillion and growing at an astronomical rate, cannot be sustained. The recent “small collapse” of the $US reflects this, but it is not enough to solve the problem. It simply cannot be repaid, even if interest rates are suppressed and the US economy keeps churning out more and more money to paper it over. Ultimately creditors (in Asia, and in the Mideast), realizing their receivables from and investments in the US are essentially worthless, will balk, and the dollar’s collapse will be sudden and total, just like all the overextended and mismanaged currencies that have preceded it.
- Inflation and Interest Rate Spikes: The real rate of inflation in affluent nations has long been in excess of 10%, but government authorities have fudged the numbers to report low rates to justify low indexing of pensions and wages, artificially low interest rates on debt, and to enable them to blame consumers for their inability to make ends meet. Rates on loans and mortgages are already jumping even as governments keep pushing down the interest rates they pay to bondholders and charge to banks and corporate lenders. As commodity prices leap and credit tightens, and as the $US goes into freefall, we will start to see the hyperinflation that plagued mismanaged economies throughout previous centuries. These spikes will exacerbate the housing and credit collapse and bankruptcy rates, and slow international trade to a crawl.
Second Wave: Approximately 2030 to 2050: Continuation/recurrence of the above crises plus:
- Economic Collapse in China and India: These economies, overheated, dependent on sales to affluent nations that will no longer be able to afford their products, dependent on cheap energy, and facing unending environmental catastrophes because of exhaustion of the soil and pollution of the air and water, will crumble. Factories will be abandoned, riots will break out, civil order will break down, and famines and civil war will rage.
- Severe Water Shortages: Water will become a scarce resource and economic activities dependent on it will become unaffordable and, with rationing, impossible to sustain. Irrigation in agriculture, tar sands development, and most mining operations will cease. Hydroelectric power plants will shut down. Human settlements in dry areas on all continents will be abandoned. The US may invade Canada to access fresh water.
- Oil Shortages and Permanent Price Spikes: As new oil projects prove incapable of producing significantly more energy than they consume, realization of the end of the oil economy will finally dawn on us all. Oil prices of 5-10 times current levels will require a permanent and painful adjustment to economies and ways of life. Areas that are inhospitable without fossil fuel heat or cooling will be abandoned. So will suburbs and areas far from employment, as outlined in The Long Emergency. Large-scale re-localization of economies will occur, as long-distance transportation of goods and people becomes uneconomic. Industries dependent on oil, such as agriculture, plastics, textiles, paints, chemicals and pharmaceuticals will face massive restructuring. Economies dependent on foreign trade will be shredded.
- Stock Market Crash and Global Depression: The combination of most or all of the above will bring about a crisis in capital markets, a huge shrinkage in consumer spending, and an unprecedented dislocation of people and industry, precipitating the second Great Depression. The last one ended with a massive government investment in war and social service spending. This time, governments will have no money to rescue the economy, so the depression could continue for decades, just as the boom of the last century endured for an unprecedented period.
- Pandemics: The concentration of monoculture agriculture, the horrific overcrowding of farmed animals with almost no genetic diversity, and human overcrowding, combined with global warming and the destruction of tropical ecosystems will, together, inevitably unleash pandemics that will affect all species of life on Earth: humans, plant crops, forests, farmed and wild animals, birds and fish. The economic losses and economic disruption caused by these pandemics will be far more devastating than the simple loss of human life. Such pandemics will become more frequent as ecosystems become more crowded, less varied and more fragile. They could happen anytime.
- Bioterrorism: As these crises start to occur with greater regularity and greater severity, a sense of desperation and hopelessness, already seen in some of the more overpopulated and desolated nations of the planet, will become more widespread. Bioterror is easy for desperate groups to perpetrate, and need no national sponsorship, and the spread of knowledge and new technologies will make it even easier. With so much of our population, food supply and infrastructure centralized, it will be impossible to prevent, and its success will encourage more of it.
Third Wave: Approximately 2050 to 2070: Continuation/recurrence and worsening of the above crises plus:
- Conventional Civil & Regional Wars Escalating to Global Wars: In socially and environmentally stressed and overpopulated areas such as Pakistan/India (two nuclear powers), the Mideast, South America, Africa and Southeast Asia, already endemic local warfare and genocides will escalate and spread into regional wars, which, as resources become scarce and nuclear and biological weapons become more affordable, will engulf the whole planet.
- Climate Change Crises: Large-scale desertification, droughts, heatwaves, the death of the oceans, widespread, violent weather events and rising sea-levels caused by glacial and ice-cap melt and ocean current disruption will all wreak havoc on an already crisis-weary planet. Some projections suggest that, by the latter part of the century, as many as one billion people in low-lying coastal areas will be permanently displaced.
- Food Crises, Famines and the Collapse of Industrial Agriculture: A combination of oil scarcity, water scarcity, diversion of cropland to fuel production, and desertification and other climate change disruption is likely to make the industrial agriculture model completely unsustainable. The switch to local, subsistent permaculture will be difficult and painful.
- Large-Scale, Endemic Unemployment: Most of the planet has lost the capacity and knowledge of how to make a living for themselves. As larger corporations prove to be unsustainable and close their doors, the immediate effect will be large-scale chronic unemployment (already evident in many struggling nations). It will take generations for citizens to re-learn the long-lost skills of feeding, clothing and looking after themselves.
- Infrastructure Collapse: For many years the global infrastructure of utilities, distribution, transportation networks and production has been neglected and underfunded. This neglect will worsed as the economy weakens, and large parts of the infrastructure previously maintained by either tax dollars or private consortia will crumble and fall into disuse, and will just be abandoned.
- Endemic Chronic Disease: It was interesting to see that the gnomes of Davos identified the soaring rates of chronic diseases in affluent nations as one of the top ten global business risks this year. We will soon, I predict, discover that this is caused mostly by the toxins in our food, air, water and soil, and by the nutritional and micronutritional poverty of the modern industrial agriculture diet. Unfortunately, the damage has already been done, and the soaring rates of these debilitating chronic diseases will bankrupt health systems, cripple the workforce, and create an unbearable burden on the healthy.
Not a particularly bright picture, I admit, and more than any species can possibly hope to overcome. All civilizations end, and so will ours. It won’t be pleasant, or sudden, but this is how I see if unfolding, based on a combination of a lot of study of history, anthropology, economics and current events, and a bit of intuition. If you think I’m missing something from this list, or if you think my timing is off, or that something else will be the first domino to fall, please jump in. If you think that technology, or ingenuity, or leadership, or spirituality, or some great collective consciousness and global collaboration, is going to rescue us, there are lots of other sites with readers anxious for your reassurance, but I’ve heard it all, and I’m past such wishful thinking.
In the meantime, this world is still a wonderful place, and it needs our attention to the issues at hand, and to the creation of models of a better way to live for the survivors of the sorry mess we’ve (with the best of intentions) created. Let’s have fun, fill the world with love, conversation and community, do what we can to make things better, or at least no worse, and let the future unfold as it will. Fare forward, o brave fellow passengers on this lovely fragile little spaceship.
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