Relocalization Revolution Needed

Over the past two hundred years, certain vested interests in the industrialized world have promoted a particular narrative about the nature of technology, development, economics and modern society. Eventually that narrative became so widely accepted that today it is virtually impossible to have an economic or political discussion outside its frame of reference. The pervasiveness of this narrative is, I have increasingly come to believe, one of the main reasons many people have difficulty accepting the reality and imminence of peak oil.

It is also the main reason proposed “solutions” to the problem—from the liberal “subsidize alternative fuels” approach to the conservative conviction that we should “let the market sort it out”—are so misguided. More surprisingly, I believe the dependency and learned helplessness this narrative engenders is a major cause of the fatalistic despair many so-called peak oil “doomers” feel.

What is this narrative? It’s impossible to summarize without resorting to caricature, but that’s how most people know it anyway. The story goes something like this:

Before about two hundred and fifty years ago, the vast majority of human beings lived lives that were, in Hobbes’ words, “nasty, brutish and short.” But in the late 18th century, a series of innovations arose in Britain—paradigmatically represented by James Watt’s steam engine—that, dramatically increased that country’s wealth through mechanization, automation, centralization and vast economies of scale. Industrialization eventually spread to the United States, Continental Europe and eventually the world.

There was a cost to this revolution, however; conditions in the new factories (“dark satanic mills” as Blake called them) were atrocious. Child labor was rampant, working hours were excruciating and worker housing was cramped and diseased. These conditions (best illustrated in the work of Dickens or later in Upton Sinclair’s The Jungle) were so bad that over time, the government passed laws to protect workers and regulate the workplace. In early 20th century America this trend was encapsulated in the Progressive movement, which itself gave rise to modern liberalism through FDR’s New Deal in the 1930s and later Lyndon Johnson’s Great Society programs in the 60s.

For liberals, the “safety net” these programs provided, along with a host of consumer protection and other laws, served as a check on the ravages of the kind of “unfettered capitalism” which arose in the 19th century.

For conservatives, “unfettered” was the good thing about 19th century capitalism. However poor factory working conditions were, they argued, they must have been better than life in the countryside, or the workers would have never come to work. (The same argument is made today in defense of third-world sweatshops). In the end, the rising tide of free market prosperity lifts all boats, (though it may lift some more than others); it’s taxes and legislation that drain the economy and actually impoverish everyone.

Both sides implicitly agree that presently existing capitalism is best described as a free market system which is, for better or worse, checked by government regulations.

The major problem with this description, as author Kevin Carson convincingly argues in two recent books, is that it’s totally false. Modern day capitalism is manifestly not a free market, but a system created and sustained by massive central government interventions in the economy. As such, not only would it not thrive in the absence of government intervention, it would collapse without it.

Carson, a self-described Free Market Anti-Capitalist of the Mutualist tradition, has earned a reputation for himself in both anarchist and libertarian circles by attacking liberalism, conservatism and what he calls “vulgar libertarianism,”—which, he argues, has lost all connection to libertarianism’s true, radical origins and has become little more than a shill for corporate hegemony.

In his two books, Studies in Mutualist Political Economy, and Organization Theory: An Individualist Anarchist Perspective (a work in progress) Carson describes in detail how, far from being the antagonist of presently existing capitalism, government was from the beginning the instrument of its triumph. The examples he gives are too numerous recount, but a few illustrations give a general picture.

To begin with, how did factory owners in the British Industrial Revolution find such a compliant proletariat to work in such abysmal conditions? At least part of the reason can be found in the passage of the Acts of Enclosure, a series of laws in which traditional peasant lands were “enclosed” and deeded to private owners, essentially depriving countless villagers of their traditional lands. These acts were direct successors to feudal expropriations in which ruling classes simply claimed lands that were already occupied by peasants and forced them to pay rent on it.

Combined with laws that restricted freedom of movement—which Carson compares to the internal passport systems of the Soviet Union or apartheid South Africa in the 20th century—the Acts of Enclosure created the very conditions in the underclass that made the Industrial Revolution possible in its historic form.

In other words, the Industrial Revolution arose as much from state action as it did from any technological advance or supposed gain in efficiency. In the absence of such actions, it is entirely possible that many production innovations could have been applied at the level of the artisan/craftsman—and history would have taken an entirely different path.

Later, in the United States, massive state intervention created the conditions necessary to create the “robber-baron” era in the second half of the 19th century, through the control and manipulation of the money system, patents, tariff barriers and transportation subsidies.

As for the 20th century, the symbiotic relationship of corporation and government is even more obvious—though it goes strangely unnoticed by many people. Examples include the military industrial complex, the widespread subsidizing of transportation and communication, the for-profit corporate benefits of government pharmaceutical and other research, tax breaks and incentives for favored industries, the myriad direct and indirect subsidies of suburban sprawl, agricultural subsidies, etc.

In the absence of such overwhelming intervention, what would the economies of industrialized nations look like? It’s hard to say exactly, but Carson makes a strong case that far from looking like the current system on steroids, they would evolve toward something a lot like the model advocates of relocalization promote: human-scaled, diverse, egalitarian, community focused and local.

To those of us brought up to believe the corporate-state narrative, this is a counter-intuitive argument to say the least. But Carson and others provide good evidence to support it.

For example, one of the main myths of corporate-state narrative is that of unlimited efficiencies of scale. Big is good; bigger is better. Just think of the “always low prices” of the biggest goliath of all, Walmart.

But apart from many other interventions, Walmart couldn’t exist in its present form without the Interstate Highway System—built, maintained and paid for by the American public. If giant corporations were forced to internalize costs that they typically pass onto consumers, there is no way they could compete against smaller-scale, more local enterprises.

As Carson sums up:

In conclusion: If we strip away all the starting assumptions of the technocratic apologists for unlimited economy of scale, and counterpose certain working hypotheses of our own, we come up with this rival model of economic organization: In a decentralized economy without subsidized transportation infrastructure, it is generally more economical to make short production runs for local markets, using multiple-purpose machinery. Given limited demand for any particular product, these short production runs are likely to be in response to demand-pull, with production being shifted to other goods when the current demand is met. Absent the push model of creating demand for predetermined outputs, product design is more likely to be for durability and ease of repair, rather than planned obsolescence. Demand is likely to be further reduced by greater reliance on community repair and recycling centers, with even the remachining of parts being more economical in some cases than the purchase of a new product. Product innovation, in a demand-pull economy, is also more likely to come about in the small shop or skunk works, with design organized on a peer-production basis.”
If Carson’s analysis is correct, I believe at least two broad conclusions can be drawn that have relevance to the issue of peak oil.

First, the widespread belief that our large-scale, energy-intensive economy is the most efficient possible is false—even given the availability of cheap energy.

Therefore—technocratic admonitions to the contrary—it is not necessarily the case that a decrease in the size of the economy (as a decline in available energy implies) must lead to a dieoff, or even a dramatic decline in standard of living (depending on how one defines “standard of living”). The only thing that would make a dieoff inevitable would be government action (malicious or well-meaning) that further distorts markets or is punitive to small-scale enterprises. Unfortunately, as the situation with corn-based ethanol proves, non-intervention is anything but a foregone conclusion.

As surprising a conclusion as it is for someone who has always been a liberal, it seems increasingly apparent to me that the most important political action citizens can take on peak oil is not to support government-sponsored “Manhattan Project” energy programs but to resist state interventions that could complicate the inevitable process of relocalizing.