The Greatest Compression (Video 5 minutes)
The Greatest Compression
Economists occasionally use the phrase, “The Great Compression” to describe the leveling of income inequality during the period 1914-1950. That covers the World Wars, the great depression of the 1930s, and the effects of Communist revolutions. A historian that summarizes this in remarkable detail is Walter Scheidel, whose book is reviewed in this issue. He concludes that in societies larger than tribes, income and wealth inequality goes in cycles. Flattening high inequality for a lengthy period before it resumes has almost always resulted from a major, usually violent reset of the society.
Scheidel is very insightful, but his is a conventional view of human wealth. Our impending ecological problems are forcing us to rethink our historical concepts of wealth. We need to permanently cut our rates of extracting and disposing of raw energy and materials. Nothing like this has ever happened to the human race. Let’s call it The Greatest Compression.
We don’t want to think about this. We don’t know how. We have to learn how to navigate a different kind of world quickly. To do it, we have to leave a world based wealth status – wealth as a primary measure of human status and success. Today we have to think in money terms because we live in an economy where daily living requires monetary exchange. Our attention focuses on the differences among us. Who are our winners, and who are our losers? Personally and politically, social justice is an emotional, daily concern; environmental justice not so much, especially if the problems seem remote and distant.
So we need a Compression way of seeing, examining what we do physically, rather than from a wealth valuation perspective using financial mappings. Thin financial veneers hide what is happening beyond our notice in the dark spots financially called external costs. We’re not used to examining these dark spots or thinking in this way. We are engrossed in wealth and fame competition among ourselves. From our gossip to our news feeds, environmental problems get less play than our squabbles and perceived injustices that the media feed us, guaranteed to hold our attention between ads.
Wealth inequality is socially stable – up to a breaking point. Wealth equality isn’t. Some are always more equal than others. Obsession with our human circus stops only when everyone is in survival mode: cooperate or die.
The inequality cycles that have occurred in every society, the fleeting fame of celebrities, the desire for recognition, the desire for ease and convenience; these things obsess us. Will it take a huge debacle for us to obsess about environmental health?
The Greatest Compression
The Greatest Compression comes indirectly from our financial numbers and endless envying. Those affect our habits and behavior and motivate our over-consumption. But to see the effect on nature, one must leave a monetary mindset and investigate what we really do to earth and its ecology. Jerking your mind out of financial ruts is hard when many of us have spent a lifetime trudging them, and popular media only report most environmental issues in passing, and we are swamped with more news than we can digest. I, for one, can no more keep up with all environmental news from special sources than keep up with all of the rest of the news. Here’s a high level list of environmental concerns from a recent questionnaire:
Climate change (the most publicized threat, but it merely exacerbates all the rest)
Declining availability of raw materials (less concentrated sources take more energy to get)
Declining return on energy (keeps taking more energy to get energy)
Water shortages and overages
Water pollution (fresh water and ocean water)
Air pollution (endemic and made worse by events like the California fires)
Soil erosion (it’s washing away)
Soil degradation (it’s not as nutrient dense or biologically active as it once was)
Toxins in proliferation (a complex mess, most threats unknown, shrugged off, or long delayed. And toxins affect all life, not just human life.)
Decline in human nutrition (a sleeper, but five decades of records show it)
Biodiversity loss – species loss (mass extinction at the bottom of the food chain would require a reset of all life, not just human, or in plain talk, we’d all b dead)
Uncertainty about how many threats may be unknown or poorly understood.
We have to dig deeper on these issues to understand what is happening. The importance of return on energy is one of these, and many popular issues fall under more than one of these high level classifications. For example, honeybee disappearance relates to toxin proliferation and to habitat loss – declining biodiversity. Dead zones at the mouths of rivers are from nitrate run off – chemicals thought to be beneficial becoming a toxin in a distant locale. These issues are complex. They run together. Our thinking can’t stop at the points of sale in a market economy.
What Do We Do About The Greatest Compression?
Somebody, somewhere knows a lot that we can do already. More technical challenges are being set; for instance Bill Gates’ Reinvent the Toilet challenge. Perhaps its poo factor recently attracted media attention to some of the winners. However, looking at the total magnitude of the changes necessary, we cannot totally invent our way out of this while life in a modern economy goes on much like it has. Everything is affected.
That implies huge social change. We resist huge social change. In particular it threatens investments in the status quo, and as Walter Scheidel concluded, almost no major social upheavals have been peaceful – certainly not ones that are global in scope – and this one is a whopper. For example, how much emotion and energy are consumed with people irked about pay inequities? How many workers are demotivated if they see that their labor makes other people rich? How many guys seeing a neighbor with a big new truck want to top it with an even bigger one. Status games; all of it.
If we dig down to root causes of overconsumption, it’s our ambitions, our concepts of status, our desire for comfort – the things we crave from the technical stream of an industrial economy.
For environmental investment, financial calculus doesn’t help much. Allocating resources to the highest return opportunities doesn’t tell us what an ecology does or doesn’t do for us — or for itself. Working with nature is a lifelong deal, not a short-term return on investment. We need a new paradigm, and we can’t order it from Amazon. Our problems with the environment are problems with how we think.
The Compression Institute does not have all the answers. Just expecting that anyone should have all the answers is old paradigm thinking. What we do have is a direction to head. It’s embodied in the Principles of Compression Thinking. Those clash with financial thinking and with the maze of legal precedents that support it.
The criteria for Gates’ Reinvent the Toilet challenge are a step in the right direction. I do not know the lifetime cycle analysis of energy and material usage for any of the entries, but I suspect that in deployment, some of them might create more problems than they resolve. Problem anticipation is what we must cultivate as never before. It will become more important than customer satisfaction. (I can hear the moans now.)
Can a toilet be made locally? Could any do-it-yourselfer build one? Shipping a finished toilet halfway round the world would use considerable energy. In other words, think local enablement, not global commerce. (More moans.)
The big test for mankind is rethinking our concepts of success, status, or even what lifetime happiness is. Then we can free ourselves from overconsumption.
We need you and your associates thinking in this groove: holistic thought; local action. Turn doomsday scenarios into actionable challenges. That’s a much brighter thought.