Filed under: Economy | Tags: bankruptcy, Catherine Rampell, defense, entitlements, New York Times, riot, Rome, taxation
I found the following graphic in from a recent article in the New York Times by Catherine Rampell titled The Dependence Economy. The graphic is from the Bureau of Economic Analysis at Credit Suisse and illustrates what should be a major concern to all of us.
Obviously this is a major topic in the current debate on the budget. Both parties have positions regarding the solution to the budget shortfall but that is not what I want to focus on. The merits of the budget debate are better handled elsewhere, instead I want to focus on the eerie similarity our situation is to that of Ancient Rome as it began to deteriorate and the economy collapsed.
See if these sound familiar:
- Large numbers of citizens on the public dole
- Continually debased currency
- Steadily increasing taxes
- Increasing burden on small businesses
- Increasing number of bankruptcies
- Wealthy citizens subjected to wealth redistribution
I am not looking to debate the various policies and the politicians and citizens who have created this parallel. Instead I want to look backward to Roman history to see if we can predict potential consequences for our daily lives. I want to try to look around the corner. So what happened that we can learn from?
See if any of these sound familiar:
- Increasing inability to pay for national defense
- Influx of non-citizens trying to benefit from public largesse
- Decrease in real wealth via declining currency purchasing power
- Disappearance of the middle class
These things have already happened or are happening. But there were other consequences as well. Rioting, breakdown of civil order and increasing disruptions to the populace as external entities took advantage of a weakened empire. Could these be the next challenges we will be facing? The parallels here are almost difficult to believe, but they are a potential way to see what might be around the corner. It seems to me that now, more than ever, self sufficiency is essential as our situation unfolds.
Filed under: Resources | Tags: automobiles, cars, fuel efficient, gas prices, oil, prices, resources, Wall Street Journal
For me that phrase conjures up several images. The images that immediately come to mind are of the giant cars of the 70’s and 80’s with their elongated frames and boxy bodies, and the massive SUV’s and Hummers of the 90’s and of this decade. But as gas prices continue to shoot up (they went up a quarter per gallon overnight here) I am beginning to reconsider the image of a gas guzzler.
Our two cars (Saturn Auras which we love) were bought with the idea of staying away from the gas guzzler. At the time we purchased the two cars (back in 2008) gas prices were much lower than today but we were both conscious of the realities of supply and demand regarding oil. We talked about China and its potential impact on fuel costs. We did not guess that there would be such turmoil in the Middle East but we were acutely conscious of the instability of our oil sources and were worried about disruptions.
So why didn’t we purchase a more fuel efficient car? We were worried about the price of gas and it turns out rightly so. To fill our tanks now it is over $50. To tell the truth I am kicking myself for not following our concerns. Now we are not in a position where we can afford a new car and even if we could it appears that fuel efficient cars are scarce and becoming more expensive with each Mideast crisis.
I suspect that in 24 months my wife and I will be kicking ourselves if we have not obtained a more fuel efficient car. We are already becoming very conscious of each long drive that we make and we wince each time we drive by a gas station and see the latest price per gallon. The thing is I am certain that we are not in the minority. So for what it is worth, if you have the wherewithal and haven’t already bought a hybrid or other type of fuel efficient vehicle, don’t make our mistake and wait until you are kicking yourself. I suspect that time might not be that far into the future.
Filed under: Preparedness | Tags: disaster, electricity, emergency preparedness, emp, thesurvivalmom.com
Take a look at this post over on thesurvivalmom.com blog. Great post on going without electricity. Given the recent discussions on here about EMP and other potential disasters I thought this blog post was very timely. This blog is one of my favorites even though I am a dad and not a mom.
Check it out.
Filed under: Preparedness | Tags: crisis, economy, emergency preparedness, food, news, nuclear, oil, world
So much of my attention last week was on Japan. The situation there is still grave and if anything the situation at the Fukushima nuclear plant is growing worse as the reactors continue to exhibit signs of meltdown. But as I was pondering our current situation over the weekend I was struck by the complexity and variety of the dangers we are currently facing throughout the world. Here is a list of the big ones that immediately came to my mind and this list is probably missing one or more areas of concern.
- Gas and Food Prices – continue to rise throughout the world creating economic tension and potentially competition for resources.
- Middle Eastern Instability – Syria, Bahrain, Libya, Egypt, Saudi Arabia, and Yemen are all experiencing disturbance and political instability thereby injecting concerns into the world economy about oil supply
- Japan – environmental disaster to the world’s third largest economy is beginning to be felt around the world as supply chains have been disrupted globally.
- Japan – nuclear crisis motivating nuclear power feasibility review at a time when energy demand continues to increase.
- U.S. economy still sluggish – warning signs include housing market weakness, high unemployment and weak growth
- EU instability – even though not highlighted in the news several member states, Greece, Ireland, and Spain remain weak and there remains a strong potential for governmental debt defaults.
These are just some of the current forces at play in our world. From political instability to a global economy suffering blows from different directions there does appear to be strong reason for concern. My wife and I have decided that it is time to beef up our ability to be self-sufficient for a period of time and we will be working on that in the coming months. What do you think? Is the above list, when taken as a whole, sufficient to worry you or is it just more of the same types of dangers that constantly plague the world?
Filed under: Preparedness | Tags: California earthquake prediction, earthquake, emergency preparedness, Jim Berkland
Jim Berkland a retired geologist who is known for forecasting earthquakes is currently predicting an imminent major quake for the west coast of the United States. I sincerely hope that he is wrong on this but if you live on the west coast it might be a good idea to take stock of your supplies and plans for the next week. I am not familiar enough with Berkland to suggest that he is usually right but he certainly comes across as credible.
Filed under: Preparedness | Tags: disaster, emergency preparedness, Japan, survival
Even one of the most ordered, obedient cultures on the face of the planet is struggling to cope with the disaster which nature proscribed. As the crisis deepens and uncertainty continues we are beginning to see growing concern from the Japanese people over their future and their present. I don’t blame them one bit for being concerned. There is not a country in the world that would be able to resolve such a crisis without time and a lot of resources.
Yet we are beginning to see that even the stoic, disciplined Japanese people are beginning to question their government and the news they are receiving as answers are confused and contradictory. Make no mistake, the sheer size and complexity of modern society makes it difficult to respond to disaster. The number of people involved makes it difficult to disseminate news in a coherent and reassuring manner. And with each country’s population at historic highs it is nearly impossible to maintain modern society in the face of disaster, whether man-made or brought on by nature.
This is the core of the issue that caused me to write this blog. This is the core of my concern about why it is important to be self-sufficient and able to survive for time periods without the support of modern society. Make no mistake there is no question of when will a disaster strike. The only question is how big will it be and how long its effects will be felt. My generation has grown up in a time where massive disaster and crisis have been dealt with and impact in the United States minimized. It was not until Katrina that we saw our own government ineffective and slow to restore our modern societal supports.
Now we see another example of a major industrialized country suffering under the lash of a massive disaster. Each year that goes by increases our population and our reliance on the system. Each year our society grows more complex and more interdependent. And each year we are in greater jeopardy of being without the support of modern infrastructure and supplies. I just hope that enough people can take these examples to heart and ensure that they are prepared to be self-sufficient when the time comes. My family and I certainly are trying to be.
Filed under: Preparedness | Tags: disaster, economy, emergency preparedness, Japan, meltdown, nuclear
One topic that I have yet to see covered by the media is the economic impact of the Japanese earthquake. Right now the focus is on the immediate disaster, as it should be. But something that we need to keep in the back of our minds is to try to understand how this horrific disaster to the world’s third largest economy. There are going to be many industries in Japan that are impacted by this disaster.
What this will do to a world economy that still feels tenuous at best is unknown but I suspect that the construction boom in Japan will not compensate for all of the other industries that are hurt by this event. After all aside from the billions in damage, the infrastructure of Japan itself has been heavily damaged. Nowhere is this more apparent than the Japanese power grid.
Officials are still trying to get a handle on the situation at the nuclear plants. Assuming the Japanese can contain the nuclear disaster their power grid is going to be severely damaged for some time. By pumping seawater into 3 nuclear reactors, the Japanese have essentially destroyed them. (Personally, I am glad that they took that step.) They will not be able to just bring three new reactors online quickly.
So the Japanese economy is facing some major future hurdles; damaged infrastructure, a power grid with less capacity, The question is therefore -Will the lasting image of the earthquake being a nuclear meltdown or an economic one?
Filed under: Preparedness | Tags: crisis, disaster, Japan, resources, shortage
The horror of the events surrounding the massive earthquake and the resulting tsunami is just fully unfolding now. We are seeing videos of distraught survivors frantic with worry over missing loved ones. We see stoic rescuers returning to search for people who might be trapped or who need help. And most of all we see a first world economic superpower with massive damage spread across much of its northeastern coastline. Buildings destroyed and debris fields everywhere.
But there is more to be seen here. If you can take a minute to look past the human tragedy there something else that is visible. Human behavior during times of major crisis is very evident during this disaster. And it is something that we should be paying attention to, even if just for a few moments. The people of Japan are acting out of fear, a normal reaction given the totality of the disaster that has struck this longtime ally of the United States.
The reaction is important to take note of. The Japanese stores have been emptied of supplies. Gasoline is hard to find and there are long lines at both the grocery store and the gas station. Why is this so important? Because isn’t happening just in the worst hit areas of Japan. It is happening everywhere, including in Tokyo. People are scrambling for resources.
Keep in mind Japan has one of the most sophisticated infrastructures in the world. And the Japanese are quite probably one of the most prepared societies for a major disaster. And yet, in Japan we are seeing resource shortages; food, water, gasoline, etc. We will have to watch to see how long the shortages remain but the lesson here is clear. Do not wait until the disaster strikes to obtain sufficient resources or you will find, like many of our Japanese friends have, that the stores will be empty, the lines will be long and fear will be the only resource in abundance.
Filed under: Resources | Tags: China, drought, emergency preparedness, environment, food supply
I have been closely watching for further news on the Chinese drought and yesterday finally saw some great news appear in a New York Times article by Keith Bradsher. The rain and snow have finally come and it appears that the precipitation when added to the efforts of the Chinese government to irrigate has saved the Chinese wheat crop. This is tremendously good news for all of us.
With a world already reeling from increasing gas prices, a food price escalation of equal severity could have pushed a tenuous global society closer to severe hardship. With the bulk of the Chinese wheat crop appearing to have survived the recent drought conditions, there is some reason for optimism. I cannot remember a time during my lifetime where two primary needs (food and fuel) were both threatened by shortage simultaneously.
While there is still a need to monitor conditions regarding gas prices, we might be able to relax regarding the specter of twin shortages on a global economy still straining to recover from the recent recession. Between this news and the email this morning from my tax accountant indicating that I am getting a refund this year, it has turned out to be a pretty good day. Now if only the snowstorm scheduled for later tonight can turn into a tropical heat wave, I will have hit the good news trifecta.
There was a spate of articles in the New York Times this week regarding events in China that should be of concern to all of us. Always wanted to use the word spate in a sentence, though I think it is even more impressive considering that my wife is currently asking whether her hair is as long as that of Carrie Bradshaw (Sex in the City for those who are unfamiliar). How is that for multi-tasking capability? In the last week the Chinese government has revealed that it has serious concerns about the current toll that the nation’s growth is having on the environment. The fact that the Chinese government is actually dealing with a growth vs. environment debate is alarming.
Considering that the government has been relying on China’s economic growth to keep the mass of Chinese people content, it is astonishing that the government is talking about scaling back their economic development. This provides two very revealing glimpses into China via two key questions that we need to ask.
- How bad is the environment in China if the government is willing to limit the Chinese economy to prevent further damage?
- What will this revelation by the government do to the Chinese people’s overall willingness to submit to an authoritarian Communist government?
Clearly the government of China is on edge and is very concerned about the possibility of the spread of unrest. The government has recently been clamping down on the foreign press. The recent actions by the government show that a lot of planning and effort have gone into preventing broad based unrest at the source. So why should this concern us?
Maybe the answer lies with Qaddafi in Libya. We have seen how an authoritarian leader who is backed into a corner can impact the rest of the world. Take a look at the price of a gallon of gas if you are unsure of what I mean. Now imagine the potential impact to the world of an authoritarian Chinese government who is backed into a corner by an angry Chinese populace. China and Libya are on wholly different levels when it comes to their ability to impact the world. Luckily for us Qaddafi does not control the Chinese nuclear arsenal, nor the second largest economy in the world.
But a small group of men do have the ability to control China and they are worried. Maybe we should be too.
Christopher Clausen's Blog 