It’s Official: The Crash Of The U.S. Economy Has Begun

[Flameblade]

So do you guys think that there's anything that a debt-free wage earner can do to avoid working on Lord Cashbucks estates once this hits?

Aside from (trying) to buy some good land near a railway, I can't think of anything.

[The Duchess of Zeon]

So do you guys think that there's anything that a debt-free wage earner can do to avoid working on Lord Cashbucks estates once this hits?

Aside from (trying) to buy some good land near a railway, I can't think of anything.

Do you have a solid, reliable vocational skill or some other form of assured employment?

If no, get one, now.

[Flameblade]

I'm a salesman...

...

Fuck.

Looks like I need to start some training. Amusingly enough, my first thought is "electrician", despite this being because of an energy crisis. I hate my brain sometimes.

[Erik von Nein]

Why would electrician be a bad choice? Sure, personal homes will probably get lots of rolling blackouts but there'll still be a big need for electricians in normal businesses and government buildings. Hell, if Duchess is correct about the soon-to-be-massive increase in electric rail use there'll be a need for a whole lot of electricians. I'd say that's a pretty good choice, actually.

[Melchior]

Assuming, as it seems likely, that economic instability will have a global scale (I'm a European), would it be a particularly bad moment to be a M.D. (my field of study of choice... I should enter the equivalent of med school next year, if I pass the entrance exam)?

[Flameblade]

As long as you can deal with a critical lack of pharmaceuticals, you'll be doing very well.

It still strikes me as deeply stupid for the FDA to have specifically encouraged petrol based medicinals over non-petrol ones.

[Mr Flibble]

Assuming, as it seems likely, that economic instability will have a global scale (I'm a European), would it be a particularly bad moment to be a M.D. (my field of study of choice... I should enter the equivalent of med school next year, if I pass the entrance exam)?

We will always need doctors, so I think that is probably a good profession to be in, unless there is a glut of doctors in Europe at the moment.

[Uraniun235]

Do you have a solid, reliable vocational skill or some other form of assured employment?

If no, get one, now.

I thought in a major depression, there was no such thing as "assured employment".

Although, this raises an interesting question. There are millions of people in the US who have nothing but service-sector skills. The service-sector isn't going to go away (someone still has to push the paperwork), but even agriculture can only absorb so much, especially if the energy supply is low enough as to make transportation prohibitively expensive. How is this going to play out?

[The Duchess of Zeon]

I thought in a major depression, there was no such thing as "assured employment".

The command economy that replaces the capitalistic economy when we simply don't recover from said depression will employ everyone with skills to deal with all the massive problems facing society, so there will be plenty of need for skilled workers, even if you have hard times for a few years beforehand.

Although, this raises an interesting question. There are millions of people in the US who have nothing but service-sector skills. The service-sector isn't going to go away (someone still has to push the paperwork), but even agriculture can only absorb so much, especially if the energy supply is low enough as to make transportation prohibitively expensive. How is this going to play out?

*giggles* It's worse than you think. The magnitude of the service sector that is going away--McDonalds and shopping malls and Starbucks and Walmart and Target, TGI Fridays and so, toy stores, Best Buy, etc--is such a significant fraction of the economy that we're actually talking about tens of millions of people, actually. The good news is that farmwork is incredibly labour intensive.

I imagine there will still be millions of unfortunates living crammed into abandoned buildings and government-owned tenements who survive by visiting government run food distribution centres and burning junk to stay warm in the winter, at least for the first half a decade or decade.

[Uraniun235]

Given how severely the federal government failed to cope with New Orleans, isn't it likely that we could instead see mass starvation? We could be looking at a total disintegration of North America.

[The Duchess of Zeon]

Given how severely the federal government failed to cope with New Orleans, isn't it likely that we could instead see mass starvation? We could be looking at a total disintegration of North America.

No, because the military will take over (literally) to prevent that from happening. Bye-bye useless political cronies, hello military dictatorship.

[Broomstick]

Oh, yes, everyone in North Korean is well fed.

A military dictatorship can be efficient in some ways, but it's no guarantee against famine. The food has to be produced first, and you have to transport it. If you're missing food or missing fuel you're going to have problems.

[Broomstick]

I also like the way people are dismissing the idea of the wealthy vacuuming up more of the economy in the event of a major downturn as if it's some kind of shadowy conspiracy theory, even though that is what always happens during such upheavals. It's a two thousand year old pattern for fuck's sake. I'm sure you remember who ended up owning all the farmland after the upheavals of the Punic Wars, and it certainly wasn't the middle class.

Ah yes, the latifunda. Well, hopefully things won't get bad enough, but on the other hand, there is some poetic justice in forcing enslaved old fat rednecks to harvest your wheat for you....

Except it won't be just the "old fat rednecks" - it will be everyone beneath the High Elite. Probably 80-90% of the population, including you and me.

[Broomstick]

I've been reading warnings about a collapse of the housing market for 2 years. Not only is the price of gasoline far higher than it was a few years ago, so is the price of food due to the cost of transporting it.

Perhaps it's just me, but these increases are insignificant. Broccoli at a dollar isn't that much more, relatively than...say at a buck twenty five. I don't know about you, but I'd hardly flinch at the difference; the 25 cent mark up.

The point here is not the absolute cost of the food item - it's the trend. A 25 or 50% mark up for a brief period of time is tolerable.... as a continuing pattern it is quite ominous.

And part of the fucking problem is this shitty :::: It doesn't cause a problem for me attitude. Yeah, it's a problem when your poorer neighbors start having trouble buying food, buying fuel, and paying for their housing, even if it doesn't affect you, personally.

Me, I can afford to pay more than I do for food and fuel. In the sense I can eat anything I want, or drive anywhere I want, and pay for it without personal hardship does not mean I don't care. I do care that taxi drivers are being squeezed, I do care my nieghbors kids aren't being fed or educated adeqautely because people are stupid enough by nature, I do care that so many people in my neighborhood can't make their housing costs because if 1/3 of the houses (not impossible in some neighborhoods) stand empty the neighborhood will go to shit and that WILL affect me.

Or to put it in the almight gas market; as I heard it in the new (tv so no link, I appologise) a little more than $500 bucks in a summer (high point in gas comsumption in USA). Well fuck, I can spent half that at Diseny Land, or take what? Three or four trips to the zoo or mall?

That's you.

Actually, if I cut back to the minimum I could probably squeak by the summer at half that - BUT, I can't cut back to a minimum. I've got an on-going family crisis down in Tennessee. I can easily burn over $150 in gas just going down and back. I don't know why people don't understand the concept of average - it's not the price people are paying, it's just the average of what their paying. Most people will be either above or below that amount, sometimes by considerable margin. Some, such as myself, can absorb those costs (although that leaves me less money to spend elsewhere) but many people can't. They're already stretched to the limit.

But then, starting around 1980, much of the American public adopted a "devil take the hindmost" attitude towards the neighbors.

There have been concerns about relatively low rate of new job creation. Bankruptcies and foreclosures are in the double-digits. More and more people are losing their health benefits. You have noticed these signs? These are not good signs, not good trends.

This is a concern. Not personally, since I plan to actually live in my house but...

Just how does this NOT affect you?

Do you think a wave of foreclosures won't affect mortgage practices?

Personally, and viewing the McMansions that have sprung up around me, I realize easily that no one can live with that shit. Interest rates and all.

That said, it takes little to plow them under and create more sensible houseing

Yeah - and who do you think is going to finance that "sensible housing"?

It's the fucking politicians promoting the damn McMansions! In some areas around here they've mandated minimum square footage for new construction that practically forces the creation of McMansions! They've made it illegal to build "sensible housing"! There's a village near me that says new houses can be no smaller than 2500 square feet - a starter home used to be just 1000! They're knocking down perfectly usable homes of 1500 square feet that ARE affordable to build monsters that start at $500,000, which the average person simply can't afford but who is offered an interest-only ARM. That allows them rent from the bank for a few years until they're left destitute and turned out on the street.

[Admiral Valdemar]

You have a problem with a command economy requisitioning people from sales and services to use as apprentice electricians and plumbers. See, you're not actually doing anything but moving from a somewhat useless energy guzzler to a somewhat useful energy guzzler. That's not demand destruction, that's shuffling the cards without cutting the deck. If you're dealing with a decreasing annual amount of energy and you're trying to build up infrastructure to deal with the loss of NG and oil powered systems, then you can't support everybody. Someone is going to get unemployed and cease using their energy. By that I mean, someone pushes up daisies so that energy goes into the intensive restructuring programme.

Thinking you're in an essential job role won't matter if there are too many doctors, engineers and handymen to support. You need to be cutting back on expenditure, which could go from people-don't-fly-abroad-or-buy-big-houses to finding-three-square-meals-daily-and-keeping-warm-is-difficult. This will be a whole new can-o-worms. You won't be safe at night if you have a garden full of food and money to pay for fuel and supplies if your neighbours have nothing. Camaraderie as seen in '29 only goes so far, and there's always, always someone ready to stir a hornets nest.

That, is why there will be massive economic upheaval in the US even if they do survive a currency that is fit to collapse, and that is why die-off will happen one way or another, be it from starving poor people to a lesser degree of healthcare maintaining the lives we see prosper so well now.

[Darth Wong]

I wonder if someone should try putting a chart of economic growth over the last century overlaid on top of a chart of energy use growth over the same time period. It's truly amazing that people think the energy use can drop off but the economic growth can continue. Perhaps it will float on the wings of America's Faith in God.

This is actually where Al Gore's ideology jumps the tracks. He's right about the dangers of global warming, but the idea that we can drastically reduce energy use and carbon output while simultaneously continuing our upward growth chart is just pie-in-the-sky nonsense.

[J]

This is actually where Al Gore's ideology jumps the tracks. He's right about the dangers of global warming, but the idea that we can drastically reduce energy use and carbon output while simultaneously continuing our upward growth chart is just pie-in-the-sky nonsense.

There's actually an entire school of economics theory devoted to this idea, they call it "decoupling"; through the use of technology we will decouple economic growth from energy consumption. Energy use will level out while economic growth keeps going up, up, and away. Their reasoning can be summarized as follows:

1) Technology has always improved efficiency and increased productivity

2) Efficiency & productivity improvements have been happening faster & faster

3) At some point, these improvements will happen fast enough to stop the increase in energy consumption and at the same time enable constant never-ending economic growth.

As you may imagine, this theory works about as well as Communism or any other failed theory.


The interesting part is that "decoupling" may indeed happen, except it's going to go the other way; energy use may level off and slowly decline while the economy takes a nose-dive towards the ground.

[Uraniun235]

Except it won't be just the "old fat rednecks" - it will be everyone beneath the High Elite. Probably 80-90% of the population, including you and me.

80-90% sounds like agrarianism to me. Also, what's going to stop the population from taking up arms and taking out that "High Elite"? (I don't think there's anything, really, given how many guns there are - so next question becomes what happens after we kill off the elite?)

[Admiral Valdemar]

I wonder if someone should try putting a chart of economic growth over the last century overlaid on top of a chart of energy use growth over the same time period. It's truly amazing that people think the energy use can drop off but the economic growth can continue. Perhaps it will float on the wings of America's Faith in God.

This is actually where Al Gore's ideology jumps the tracks. He's right about the dangers of global warming, but the idea that we can drastically reduce energy use and carbon output while simultaneously continuing our upward growth chart is just pie-in-the-sky nonsense.

Will half a century do?

The slowdown in consumption here is often touted by environmentalists and those J mentioned as proof we can "decouple", but in actual fact, it could easily be attributed to the spurt for efficiency after the crises of the '70s and early '80s over energy. The US was far more into efficient cars back then, something now lost. Either way, energy always rises with GDP, or the other way round I should say. The rate has increased lately, which coincides with far greater national growth in industry too, despite manufacturing moving abroad etc. The correlation is evident and shows that efficiency can only go so far, often leading to more consumption as in Jevons' Paradox.

Bottom line: To have growth with not only level energy supplies, but shrinking ones is simply not sustainable. Somewhere, fat needs to be trimmed, and that does not mean people work in an arbitrarily more productive sector of society. It means they cut down or lose it altogether.

80-90% sounds like agrarianism to me. Also, what's going to stop the population from taking up arms and taking out that "High Elite"? (I don't think there's anything, really, given how many guns there are - so next question becomes what happens after we kill off the elite?)

You then reload and deal with the massive influx of refugees seeking haven in the US before they do the same to you.

[The Duchess of Zeon]

Except it won't be just the "old fat rednecks" - it will be everyone beneath the High Elite. Probably 80-90% of the population, including you and me.

There's never been a society in which that much of the population has been enslaved. Never.

You do realize that statement wasn't remotely supposed to be serious, don't you? I mean, holy fuck, we're talking about the latifunda here, not exactly anything except an obscene instrument of sheer brutality. It was a sarcastic inflection against those who have done us the most hurt, nothing more.

And no, military governments do indeed often let people starve, but those from reasonably responsible countries. If the Royal Thai Army can run a country properly--and they're US trained--I expect our government to be able to be able to be run by the military if it comes down it. We even have specialist units designed to run other countries, it's called the Civil Affairs branch; they'd be just as effective here in maintaining the country against a breakdown in order.

Frankly, I'm more afraid of a communist revolution in these circumstances than anything else, and those fatcats you're afraid of are going to be far, far more terrified of that than anything else, and that will mean they won't remotely have any sort of free reign as you may fear.

[Broomstick]

Except it won't be just the "old fat rednecks" - it will be everyone beneath the High Elite. Probably 80-90% of the population, including you and me.

80-90% sounds like agrarianism to me. Also, what's going to stop the population from taking up arms and taking out that "High Elite"? (I don't think there's anything, really, given how many guns there are - so next question becomes what happens after we kill off the elite?)

As already mentioned, agriculture can be extremely labor intensive. When fuel gets short, human labor may become cheaper than motor-driven machinery. If you aren't using petro-chemical derived fertilizers spread with petro-fuel machines what are you going to do? Even if you revert to steam power you'll need someone to produce the fuel to drive the machinery.

It's not just the actual laborers sowing and reaping under the sun - it's also the ruling elite demanding servants of one sort or another. There have been plenty of civilizations where the vast majority served the small ruling elite. Why do you think it couldn't happen again?

As for "rising up" - the ruling elite control the most advanced weaponry on Earth. Do you really think hunting rifles can take on tanks and attack aircraft? If it did come to that, the best we could hope for is a situation like Iraq where an insurgency exists but can't decisively triumph unless they drive the other side out - that might happen in Iraq, but in the US the rulers are far less likely to pull out and go elsewhere.

[The Duchess of Zeon]

As already mentioned, agriculture can be extremely labor intensive. When fuel gets short, human labor may become cheaper than motor-driven machinery. If you aren't using petro-chemical derived fertilizers spread with petro-fuel machines what are you going to do? Even if you revert to steam power you'll need someone to produce the fuel to drive the machinery.

Yeah, but 19th century/early 20th century, pre-mechanization farming still allowed us to concentrate close to 60% of the population in cities. 40% in agriculture is a huge number compared to 3%, but let's not forget that hardly all of those people will be migrant farm labourers. We're talking about plenty of individuals who will be able to successfully work freeholds, and maintain themselves off of small farms, which will actually be profitable again with the collapse of the modern agricultural combines. It would be a fucking hard life but you'd have your own land and that instantly makes you respectable.

It's not just the actual laborers sowing and reaping under the sun - it's also the ruling elite demanding servants of one sort or another. There have been plenty of civilizations where the vast majority served the small ruling elite. Why do you think it couldn't happen again?

I just don't see the new elite as being dramatically worse than the elite we lived under for most of European history, and, really, the average European yeoman even seven hundred years ago had a pretty decent life, all things said.

As for "rising up" - the ruling elite control the most advanced weaponry on Earth. Do you really think hunting rifles can take on tanks and attack aircraft? If it did come to that, the best we could hope for is a situation like Iraq where an insurgency exists but can't decisively triumph unless they drive the other side out - that might happen in Iraq, but in the US the rulers are far less likely to pull out and go elsewhere.

The factories to build those weapons and the fuel to power them would be exquisitely vulnerable. A General Strike would disrupt production and supply, making the army hard-pressed to respond. We don't even have railroad troops like a lot of Europe powers in the WW1 era did--that is, special units of the military who are trained to operate railroad trains in case of a general strike so that it won't cripple mobilization.

Ever since Marx wrote his economic thesis, the conditions in it have never actually taken place. We have never actually had negative growth which forced the rich to horde and began to impoverish the working classes before. Never. Growth flatlined in the 1930s, and the rich have been getting richer in ratio to the poor, but the poor have also been continuously getting better off.

That's going to change.

We're literally, for the first time, going to have the correct economic conditions for a Marxian socialist revolution. And if people pulled the things off repeatedly without those conditions, I'm quite afraid of what they're going to do when those conditions actually take place.

[Broomstick]

Except it won't be just the "old fat rednecks" - it will be everyone beneath the High Elite. Probably 80-90% of the population, including you and me.

There's never been a society in which that much of the population has been enslaved. Never.

I'm sorry - I was posting first thing in the morning - did you actually specify "enslaved" or merely peasent/serf status?

And while there hasn't been such a society yet (and I'm not entirely convinced of that statement, though I don't feel like having either you or me delve into it) can you offer an argument why there couldn't be such a society?

I mean, holy fuck, we're talking about the latifunda here

That might actually mean something more to me if I knew what the fuck a "latifunda" was - I don't ever recall encountering that term before.

It was a sarcastic inflection against those who have done us the most hurt, nothing more.

As we all know, sarcasm doesn't always transmit over a text message so yes, I did miss that.

We even have specialist units designed to run other countries, it's called the Civil Affairs branch; they'd be just as effective here in maintaining the country against a breakdown in order.

Given the recent and historical fuck-ups in maintaining order abroad, I have to be skeptical if, indeed, such order could be maintained here.

[Broomstick]

really, the average European yeoman even seven hundred years ago had a pretty decent life, all things said.

Well, yes, like wasn't TOO bad - except for the complete and utter lack of medical care and sanitation, restrictions on movement, lack of material wealth, lack of heat in winter, lack of cool in summer, lack of reliable clean water, maurauding criminals...

Sure, people CAN be happy even under such circumstances - but their lives will be shorter, with more illness and pain. In part, they didn't suffer because they didn't know anything else, but someone accustomed to 24/7 climate control, modern medicine, year round fresh food, and other modern luxuries will suffer until they adjust. And some won't ever adjust.

I think I could adjust - I live a pretty frugal life as it is, aside from aviation (which, in this hypothetical world, won't be happening for me anyway) but there sure as hell would be a lot of things I'd miss.

[The Duchess of Zeon]

I'm sorry - I was posting first thing in the morning - did you actually specify "enslaved" or merely peasent/serf status?

The latifunda were massive plantations with slaves kept underground in confined quarters during the night, who worked them in chains, in conditions of immense brutality,

And while there hasn't been such a society yet (and I'm not entirely convinced of that statement, though I don't feel like having either you or me delve into it) can you offer an argument why there couldn't be such a society?

All regimes need a support base, essentially. You need the yeoman farmers' children to fill the ranks of the enlisted military if nothing else. The Ottomans experimented with using slaves as professionals at every level of the civil service, but I'd voluntarily sell myself into a position of Ottoman court slavery, because I'd literally end up running the country in 20 years, seeing as those "slaves" could end up being the Grand Vizier, and, in fact, for the first three hundred or so years of Ottoman history only slaves could become Grand Viziers. But even in the Ottoman Empire, which also experimented with slave armies, the support base was still the Anatolian Sipahis, the freeholders who were required to show up at the Sultan's command with a horse and a bow for campaigns.

That might actually mean something more to me if I knew what the fuck a "latifunda" was - I don't ever recall encountering that term before.

It was the most brutal system of slavery ever devised in history, essentially, and it came about as a result of the economic collapse of the Roman Republic letting the rich buy up farmland and drive the small freeholders into the cities, achieving economies of scale by using the newly conquered slaves from the vast territories gained by the republic to form huge plantations.

Given the recent and historical fuck-ups in maintaining order abroad, I have to be skeptical if, indeed, such order could be maintained here.

We have never activated our civil affairs units, because we did not want to actually administer Iraq. The Iraqis were supposed to do it themselves, by magic, just like everything else about that clusterfuck.