Global Guerrillas

JOURNAL: Resilient Agriculture via Perennial Grains

The vast majority of the calories (70%) we consume on a daily basis are derived from grains (wheat, rice, maize).  However, these crops are input intensive (capital, energy, and physical labor) and very vulnerable to shortages/disruption of those same inputs (mostly because they are annual crops that need to be replanted every year).  In order to make them appropriate for integration into resilient communities, a new approach is needed: one that allows us to avoid, reduce, or obviate the hard inputs required for grain production through the adoption of a methodology that enables rapid cycles of decentralized innovation.  

One potential approach to grains production that meets this hurdle is being pioneered by Jerry Glover at the Land Institute of Kansas (I had the pleasure to meet Jerry yesterday in Aspen).  He's working on breeding perennial versions of common grain crops.  This provides the benefit of not only increasing the resilience of these plants, the process being used to achieve these perennials is something that would work extremely well within an open source, decentralized tinkering network.  

JOURNAL: Building Post Scarcity Resilient Communities

No big surprises at the Aspen Institute conference:  the big money is still flowing towards huge, global-scale projects and schemes that aren't likely to work.  In stark contrast, Marcin and his team of farmer scientists working on post-scarcity economics is making lots of progress (see Marcin's economy in a box presentation for context).  They are doing this on a shoestring, which is a shame.  Here are some highlights:

• The CEB (compressed earth brick) press called the Liberator.  The team has completed its first product (the design is open source, of course).  It allows the rapid manufacturing of construction materials from nearly ubiquitously available resources.  
• They've built a working prototype of an open source drill press they are currently using in their fabrication processes.
• They are building the second prototype their soil pulverizer.  

LINKS: 26 JULY 2010

Some random items of interest:

• Hackerspaces should be at the center of every resilient community.  They can take a variety of different forms from maker spaces to tool libraries.  
• The Arduino as the Altair of physical computing.  Time to put it on a chip and shrink its form factor.
• Wikileaks vs. the US DoD.  Wikileaks wins again in a nicely executed operation. 
• Police capture the tribal rules of the Latin Kings gang.  
• The Pentagon doesn't have a clue as to the degree of the austerity that's coming. 
• DIY satellite kits:  $8 k.
• DIY method to build a local telephone company.  Mesh network phone nodes (nice):  The Mesh Potato
• How to survive a raid on your food co-op.  
• The US ruling class.
• The value of community lending.   Grameen expands in the US.  
• Transactional currencies that compete with the Euro.
• More later.

STATUS: In Aspen, CO

Had a little lapse in posting.  Ran out of juice and got busy on another project.  I'm recharged now and ready to press forward.  Today I'm in Aspen at the Environmental Forum, put on by the Aspen Institute and National Geographic.  Should be interesting, there are lots of interesting people here.  

JOURNAL: Global Guerrillas and Resilient Communities in Afghanistan

Some standard GG insights from Afghanistan in a recent article by Kaplan in Slate:

• Co-opting infrastructure.  The brand new $100 m Kajaki hydropower plant in southern Afghanistan (contrast this to the lack of new infrastructure in the US) is being co-opted by the Taliban.  They are charging locals for the power (via door-to-door visits) and redirecting it to private uses.  Not only does this provide them funding, it provides them legitimacy.
• Resilient power?  To get more credit for the benefits of the new infrastructure, the US military wants to build local power systems, which is very much in line with resilient community thinking.  The problem is that they want to install diesel generators in each locality (which substitutes another form of dependence that can be co-opted).  They should be thinking in terms of systems that are completely local and they should broaden their thinking on what energy means.
• GG political goods.  The Taliban have set up an effective (free and fast) justice system in areas that they control.  As Kilcullen points out: if you show up at an Afghan police station with a complaint, they'll beat you up for bothering them. If you take someone to an official court, it takes months to get a judgment, and it will go to the guy who pays the biggest bribe.  This is classic.  The first political good that GG groups provide is almost always justice.  It also demonstrates that the Afghan government is a hollow, illegitimate, corrupt shell and that counter-insurgency efforts that support it are akin to pushing on a string.
• Open source counter-insurgency.  The first move by Petraeus in Afghanistan was to get Karzai to sign off on local militias.  A move towards a large collection of autonomous militias is the hallmark of an open source counterinsurgency and was the secret sauce behind the limited success in Iraq.  Of course, to fully replicate that in Afghanistan would greatly weaken Karzai.  As a result, they have watered down the proposal:  they new militias would be "police" and get uniforms and pay from Afghanistan's Interior Ministry.  

All of the above appear to be classic open source warfare dilemmas.  They should be thinking in terms of autonomous resilient communities that are protected by local militias.

JOURNAL: A Mechanism for Economic and Political Concentration

A couple of years ago, I wrote about the collapse of decentralized/open decision making in Western societies.  Here's a snippet from the article:

The 20th Century's central struggle was between the ideological systems that advocated governmental control of the economy and those that relied on market control. The market-based systems won. Why? In short, market-based systems made better investments, over the long term, than government managed systems. The lesson: systems with large numbers of decision makers, each with capital to invest, make better decisions.

As is often the case, the emerging victory of the market-based system created yet another problem/struggle. Specifically: is it better to trust that individuals empowered with growing salaries/wages will make the best investments for future economic success -- or -- is it better to grow corporate profits (at the expense of wages/salaries) and let capital markets invest the excess?

Between WW2 and 1974, while still engaged in a bitter struggle with Communism, the US hedged its bets on that question. Both individuals and the capital markets received an equal share of the benefits of productivity growth. Incomes rose mightily and we became broadly wealthy, mirrored by generous growth in the capital markets, relative to the start of the century. As a result of this shared decision-making system, smart investments in infrastructure, industry, education, and much more made America the economic powerhouse of the world. In short, we prospered.

However, the shared decision making system ended. From 1974 onwards, the rewards of productivity growth (economic expansion) went exclusively to the capital markets and not into income growth for individuals.

In short, this change led to economic (and by extension political) decision making to become extremely concentrated, and therefore precarious/unstable/stagnant.  At the time, I left open the precise "conventional" reason for why this happened.  Yves over at Naked Capitalism (channeling Thomas Palley and Raghuram Rajan) sums up a cogent rationale for why it happened.  She blames the economic theocracy at the Fed:

What led to the change in the deal was the stagflationary 1970, which was driven both by a commodity prices (most notably the oil crisis) AND labor baragaining power (workers were able to demand that wages keep pace with inflation, which when inflation got beyond a modest level, meant it started to become self-reinforcing).

So the new program was to reduce workers’ bargaining power, both by combating unions, and by tolerating un and underemployment. Rising worker wages had been seen as crucial to greater prosperity; it was quietly abandoned as a policy goal. But this has profound implications. As rising income inequality demonstrates, the benefits of growth accrued substantially to those at the very top...

Reducing worker bargaining power led to disinflation, lower interest rates led to rising asset prices, which in combination with financial innovation, created an until-recently reinforcing cycle whereby rising asset prices [and the substitution of debt for income] funded consumption.

JOURNAL: Building Resilient Communities From Scratch

Here's another approach (one of many alternatives) to building resilient communities that may be of interest:

There seems to be a considerable amount of interest (on my backchannel) in building resilient communities as completely new and professionally designed housing developments. Given how terrible the housing market is (and will continue to be from here on out), this makes sense.  It's the only game in town.

It's also an effort that has the potential to succeed.  There are hundreds of thousands of people (soon to be millions) that both fear the social/economic tsunami ahead and have the (current) financial resources to fully fund the development of resilient communities.  These people have a overwhelming desire to circle the wagons (for themselves now, for retirement, or their extended families) while they still can.  

However, serving this emerging market is going to require a major shift in culture for most traditional developers.  Why?  Selling a resilient community is a very different process than selling a house (school quality, commute distance, architectural amenities, etc.) or a retirement/vacation retreat (luxury, services, access, etc.).  It's about selling a complete and integrated economic and social system (of which there are many designs to choose from), in microcosm.  In short, these communities need to embody a vision of a viable and vibrant future that will persist despite widespread global failure.

As a result, successful developments that serve this emerging market will need to do everything from finding ways to fund the buildout and management of new resilient community infrastructures to the ongoing economic/financial support required to establish and grow a large number of prosperous local producers (that will eventually power the community over the longer run as the global situation worsens).  Anything less won't sell.

LINKS: 12 JULY 2010

Some random items of interest (I've been disconnected for a project I've been working on, still working through my e-mail backlog):

• Gaikai.  Cloud based games/apps.  Interesting VR twist possible here (as in upload video and download VR enhanced video).
• The Iranian Revolutionary Guards and smuggling.  Very GG.  The size of Iran’s smuggling industry has been estimated at $12 billion a year, and the IRGC is believed to control much, if not all, of it.
• SFGate.  Paul Saffo is sounding very GG:  the Bay Area needs to start thinking like a city-state In an age when nations have become so large that their citizens no longer identify with distant governments, city-states are political units large enough to have a global economic impact but small enough for even the most casual citizen to understand the relationships that make their city-state work. Politicians are local and thus more inclined to pragmatism and constructive action. Businesses understand that their fortunes are tied to the success of the local community. This balance between effect and size and the tendency toward social cohesion make contemporary city-states like Singapore and Hong Kong bright spots in an uncertain global economy.  Read the whole thing.  
• Bitcoin.  P2P Cryptocurrency. there is no central authority to issue new money or keep track of transactions. Instead, these tasks are managed collectively by the nodes of the network.  Looks cool.
• Lloyds assesses the business risks due to supply disruptions from peak oil. Lloyd's also calls on manufacturers, retailers and the wider business community to reassess global supply chains and their just-in time models because the "current system is increasingly vulnerable to disruption."  An increased risk of disruption is going to be incorporated into insurance premiums.  Yet another competitive advantage for resilient communities.
• Could Iceland, already making waves by becoming the world's haven for journalists, zoom its economy by providing the same protections for open source innovators?  In short, by becoming a place where monopolies on ideas are unenforceable?
• MSNBC poll.

LINKS: 2 JULY 2010

Items of interest in open source warfare:

• Afghanistan.  In a now classic move, Afghan guerrillas are now targeting contractors in America's long tail counter-insurgency in earnest.  Today's attack targeted the USG contractor DAI (Development Alternatives International) and their security subcontractor Edinburgh International.  In Iraq, this type of targeting increased costs by 50-100% and seriously delayed (or fully stopped) projects.  This is typically much more effective than an attack on military personnel, although it appears that in today's attack DAI got lucky.

Some random items of interest regarding our progression towards a hollow state:

• Kedrosky.  Market illiquidity as a feature and not a bug of modern markets.
• The average life span of clean-up workers in the Exxon Valdez spill is 51 years.  BP refuses to release data on chemicals used in clean-up efforts.   
• California.  Maywood (a town of 40,000) begins the outsourcing of its government services.    
• 652,000 people dropped out of the US labor force last month.  They simply gave up. As a result, they won't be counted in calculating the unemployment rate.  Nothing lies better than statistics.
• California:  200,000 state workers will now be paid at the federal minimum wage (until the budget deficit is closed).  $7.25 an hour.  According to those in the global markets: why should anyone complain since that's a globally competitive wage for the services rendered?   Of course finance, in contrast, is the market God's work (He, of the invisible hand) and is remunerated accordingly.
• US:  State budget disaster.  $140 billion shortfall at the state level alone.  900,000 state and local workers at risk.   An amazing 20 million people (15% of the workforce) work as state and local employees.  
• Mexico:  21 die in fight between gangs for access to border crossing area.
• Telegraph.  Middle class triple whammy.  Classic conclusion: So I have one simple question: when do the politicians intend to let the public know about the fate that awaits them? The longer they put it off, the nastier the reaction, the bigger the strikes and the greater the chance that governments will fall. Don't say you weren't warned. 

JOURNAL: Ad Hoc Vampire Energy

Here's a DoD system that provides special ops teams with the ability to use any power line as a source of energy.  Very cool.
 

TV: What to do with the war in Afghanistan?

I'm going to be on the Dylan Ratigan show (MSNBC) this afternoon (the last show I did was on Fox) to talk about how to fix Afghanistan.  Here's a preview.   

Should the US be in Afghanistan?  Absolutely not.  Three reasons:

• There's no compelling interest for the US to be in Afghanistan.  Al Qaeda isn't there anymore.  It's broken as an organization and unable to launch large attacks. 
• Our presence in Afghanistan does us more harm than good in two ways.  First, our efforts there have pushed Taliban fighters into Pakistan.  Second, our drone attacks on Taliban leadership in Pakistan cause a significant number of civilian casualties.  Both of these actions destabilize Pakistan which is against our strategic interest.
• We can't afford it.  We're broke, running $1.5 trillion deficits as far as the eye can see.  This deficit is a real national security problem as opposed to Afghanistan.

What should the strategy in the area be after we withdraw from Afghanistan?  Three things:

• Play the role of the spoiler.  Ally ourselves with any group that opposes the Taliban, in much the same way we "took" Afghanistan back in 2001.  
• Maintain a special operations and drone presence in the area to prevent Al Qaeda from reforming in Afghanistan.
• Take advantage of the opportunity to finally realize the dividend afforded by the end of the Cold War.  Cut the US defense budget, currently more than the rest of the world combined, by half.  

JOURNAL: The Decline of the Western Middle Class

The most virtuous and exceptional feature of modern western civilization is that it created something new to history:  an economically and politically dominant middle class.  The stability (political), vibrance (economic growth and diversity), and innovation (technological) it produced is historically exceptional.  

Unfortunately, that singular accomplishment is soon to become a fond memory.  Why?  The social contract that enabled this success, particularly the post WW2 social contract that shared the increases in wealth generated by improvements in productivity with the more productive workers that enabled it, ended with the financialization of economic activity and globalization (and governments that facilitated and catalyzed the process).  In sum, the increase in wealth the western middle class produced over the last three decades has been transfered to global financial elites (who misspent it) and mercantilist nations (China, Japan, Korea, Taiwan, etc.).  We can see the result of this.  It's tangible:  The median income (the best measure of the health of the middle class) of the western middle class today is less than it was in 1974, despite massive top line GDP and productivity growth (both global and national) during the same period. 

The ongoing strangulation of the western middle class is at the heart of the west's current problems.  Everything else is fluff, misdirection, and hot air.  Its death creates, in the short to medium term:

• Economic stagnation/depression.  An ever increasing loss of vibrance.  Shrinkage, across the board.  Wealth destruction.  
• Inevitable government bankruptcy.  An ongoing and inexorable shrinkage of the tax base that funds government activities.  Governments become slaves to global bond markets.
• Political instability.  Increasingly fractious political discourse.  Increasing violence.  A rise in criminality and corruption.