Too Big to Fail? The Inevitable Collapse of the US Economy

The US economy is swaying, teetering heavily under the increased debt burden imposed by the Iraq War and now the looming banking crisis. President Obama’s proposal to remediate the crisis situation by introducing more debt into the system is now law. The only problem is that, under the present circumstances, President Obama’s therapeutic regimen represents, with a very high probability, the very medicine that will strike a mortal blow to the patient — in this case the US economy.

A steep rise in US housing foreclosures is a crucial element of the present credit crisis. Unfortunately, many of these ‘toxic’ assets are still held by the banks, which are unable to liquidate them from their balance sheets without first going insolvent. No one on the market is willing to buy or sell them, in part as these troubled assets are extremely difficult to price. Even once they are marked down to a selling price, a significant proportion of US banks will still have to enter into bankruptcy proceedings. This represents a painful but necessary step that must occur should the US economy have any hope for recovery. To prevent the death of the patient and to facilitate recovery, it is absolutely necessary, in medical parlance, to first amputate the diseased limbs of the US economic engine.

Unfortunately, the Obama Administration’s plan makes impossible the very outcome that is needed for recovery, and therefore unwittingly enables the disease to spread throughout the entire body. Keeping insolvent banks alive with capital infusions from the government merely postpones the inevitable failure of a large segment of the US banking industry, while damaging the rest of the economy. The Stimulus Package, furthermore, rapidly increase debt spending to overcome a problem whose origin lies in excessive debt spending. If water were previously flooding one-third of the ship, the Stimulus Package makes it inevitable that the rest of the ship will eventually succumb to flooding as well.

The most likely outcome is relatively simple, yet it is one that would be harrowing to most Americans: the US economy — that which has fueled growth throughout the world for over a century—is presently on the verge of collapse. It is merely a matter of time — not if, but when — that the US will default on its own debt, causing the US currency to become worthless on world markets. When this happens, the US, like any large corporation that fails, will be forced to restructure, to reorganize under the terms of a new economic system, one that meets the long-term interests of those willing to finance it.

Sadly, prior to the swearing in of America’s 44th President, this outcome was largely preventable — however painful any economic recovery might have been. However, it would be nearly impossible to prevent the historic collapse of the once-great American economy at this juncture in world history. So great is the damage that has already been done that “ America the Great” will likely fall prior to the end of President Obama’s first term in office. This prediction does not factor in the impact, one that is likely, of another major terrorist attack on US soil, which would, for all practical purposes, represent the final nail in the coffin.

Elections have consequences. Americans — 52.7% of them that is — made their preference known in the voting booth. Unfortunately, the most likeable doctor is not always the one that is most capable of effectively addressing the illness. Americans should not lay the blame for this economic demise on their 44th President, but rather on their own inability to put the needs of their nation ahead of their desire to reap personal benefits. Any careful analysis of the Presidential campaign will reveal that President Obama is merely fulfilling a campaign pledge — to provide Americans with the unattainable, no matter what the cost might be to the nation.

Nicholas Vakkur is a researcher that lives in Venice, CA with his wife and two children. He can be reached at: Read other articles by Nicholas, or visit Nicholas's website.

48 comments on this article so far ...

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  1. Mtnlynn said on March 4th, 2009 at 1:15pm #

    The real mystery to all of this is the mass of credit default swaps running around in the system. I cannot seem to find any information about (1)Of all the toxic bonds held by the banks how many of them are covered by this default insurance? (2)What is the term for these CDS. Is it a one time fee or must they be periodically renewed?

    If the swaps can be flushed out of the system there should be a recovery, if not we’re toast. Does anyone out there know more about these things than I can find out?

  2. Paul Meyer said on March 4th, 2009 at 2:03pm #

    The credit default swaps are basically bets–like an insurance company or a gambler–but what happens if the gambler (or insurance company) cannot pay its losses when it (he) loses? And in this case some of the biggest losers are the international financiers who believed their bankers and accrediting agencies (like Standard and Poors) that these investments were AAA. There was a solution which in all probability would have meant loss of the dollar as the reserve currency (for a lot of banders, U.S. and otherwise, would lose BIG). But Obama has chosen (or been instructed by his handlers) to attempt to “float the boat” on the backs of American taxpayers, with an unimaginable debt. Welcome to Bernacke-world!!

  3. John S. Hatch said on March 4th, 2009 at 3:21pm #

    While America teeters on the edge of financial catastrophe, still its insane military spending on death and destruction is a topic that cannot be discussed. This is nuts!

  4. Mtnlynn said on March 4th, 2009 at 3:27pm #

    If the gambler can’t pay the treasury will ante up, hence the bottomless pit of AIG. Still leaves a lot of unanswered questions about how long this will go on. Are they possibly even still writing the things? The total amount of these things is greater than all the currency in the world. It shouldn’t have even been legal. The actual buyer of the bond maybe. The actual situation is the equivalent of 20 or 30 people taking out a fire insurance policy on someone elses house. If these things don’t expire or otherwise disappear at some point there is no solution. And who are the AIG policy holders that we are paying off?

  5. Mulga Mumblebrain said on March 4th, 2009 at 5:42pm #

    The collapse of the US will be greeted around the world with joy. The reaction to 9/11 tells you what to expect. Sorrow at the deaths of innocents, but ecstasy to see the greatest bully, mass murderer and condescending racist thug in history getting a tiny sample of the death and destruction it has rained on millions for decades. The collapse of the US, hopefully taking the insane and inhumane system of ‘market fundamentalism’, in truth a neo-feudal project to reduce the world’s population to penury and install a global parasitic elite in perpetual overlordship, with it, not only will allow the rest of humanity to build a system that first and foremost guarantees human survival in the face of climate change and Peak Oil, but will also be an opportunity for the US populace to build a system that reflects the grandiose rhetoric of freedom that they constantly spout, but of which their society has always actually been the antithesis. In fact, both for humanity at large and the US in particular, this will be a last chance. Failure to seize the opportunity, to eject the parasites forever, ensures humanity’s doom.

  6. Don Hawkins said on March 4th, 2009 at 5:54pm #

    Mulga change here in the States is coming we are trying and the fight is on. I want to hear from you the weather in Australia as those ocean temperature anomalies to your South East are big. How does it look.

  7. Jeff said on March 4th, 2009 at 6:39pm #

    Waking from slumber is great, is it not. Wipe the sand from your eyes and notice what!? Your world has changed. There is not a f$&*ing thing you can now do about it. Heck, go ahead and try. Really. Go ahead and try. Really.

  8. Ron Horn said on March 4th, 2009 at 7:21pm #

    As I see it the problems with the economy basically started as the Vietnam War was coming to a close. The US ruling class ran up huge expenditures trying to maintain its hegemony over southeast Asia while maintaining “Great Society” domestic programs at home. Much of our gold had been sold off and we could no longer abide by the 1944 Bretton Woods agreement in which we agreed to maintain a certain percentage of gold to back the money we issued. Also it was agreed that the US dollar would be the international reserve currency used to conduct most trade. Having exhausted our treasury in the war, we decided to go off the gold standard and let the dollar float in the market. Then according to Engdahl in his book, A Century of War:

    “As early as June 8, 1974, in his capacity as U.S. Secretary of State, Henry Kissinger had signed a little-noted U.S.-Saudi Arabain Joint Commission on Economic Cooperation, whose official mandate included , among other projects, ‘cooperation in the field of finance.’

    “By December 1974, the nature of this cooperation had been defined more clearly, though strict secrecy was maintained by both Saudi and Washington governments. The U.S. Treasury had signed an agreement in Riyadh with the Saudi Arabian Monetary Agency, whose mission was ‘to establish a new relationship through the Federal Reserve Bank of New York…. Under this arrangement, ‘SAMA [Saudi Arabian Monetary Agency] will purchase new US Treasury securities…’ explained Assistant Secretary of the U.S. Treasury, Jack F. Bennett, later to become a director of Exxon.

    “No less astonishing than these U.S.-Saudi ‘arrangements’ to one ignorant of the real history of Anglo-American interests in the Persian Gulf was the exclusive policy decision by the OPEC oil state to accept only U.S. dollars for their oil—not German marks, despite their clear value, not Japanese yen, French francs or even Swiss francs, but only American dollars. [p. 153] ”

    Henceforth the U.S. dollar was propped up by petrodollars. This arrangement with the gulf states was brought about by all kinds of commitments on the part of the U.S. including supplying them with the latest weapons, preferential trade agreements, and no doubt guarantees of U.S. protection. Voila! The U.S. dollar was saved. If you are the biggest and richest bully in the neighborhood, you can have your way with the neighbors.

    The bully gets into more scrapes with various people who try to stand up to him, and he spends even more money on weapons to extend his domination while always consuming more than he produces which is very little except for murder and mayhem. He just gives everyone IOUs for what he needs. Then he invents some new scams which take the form of new fangled financial instruments and peddles them around the neighborhood. Pretty soon people discover that they are worthless, and now they find themselves broke or nearly so and the neighborhood economy is devastated. Here the metaphor breaks down, because the real bully is the U.S. ruling class and its immediate victims were many financial institutions who were left holding these worthless pieces of paper. It must have been very much like a pyramid scheme where most of these financial geniuses knew that it was a phony game, but so many were making fortunes off it that few people complained. Because this class exported our productive facilities to other countries where labor was cheap and environmental regulations lax, the credit institutions, supplied with re-cycled petro dollars, provided you and me, the working stiffs of the U.S. with easy credit to keep the profit machines going. Capitalists only produce when they can make a profit, not to provide for society’s needs. Now with many of these financial institutions busted and in this climate with so much uncertainty, they shut down their factories and businesses until things can get sorted out and they can be assured a profit. Getting things sorted out means robbing the national treasury that you and I supply with our hard earned dollars, and leaving us, our children, and our children’s children with the bill to pay off. To add injury to insult, it’s clear than few of this class, or their employees (congress & other government officials) pay any taxes. Witness the many Obama appointments who were found delinquent with their taxes. Everyone knows that the super rich keep their wealth in off-shore tax havens. Some have estimated this to amount to something like 7 trillion dollars. I find it simply amazing that there isn’t a revolution in this country!

  9. Brian Koontz said on March 4th, 2009 at 11:10pm #

    “While America teeters on the edge of financial catastrophe, still its insane military spending on death and destruction is a topic that cannot be discussed. This is nuts!”

    Unfortunately, it’s not nuts. Most of the “American” economy is owned by multinational corporations, who have no allegiance to any country. Their only allegiance is to profit and control (which ensures future profit).

    There’s no such thing as “it’s insane military spending” – there is no “it”. America is not ruled by people who care for the welfare of either the country or it’s people. America is not ruled by Americans.

    America is just another market to the multinationals. If it goes under then, well, there are other markets. China has a positive future, according to the multinationals.

  10. Peter said on March 4th, 2009 at 11:18pm #

    The author of the article says “under the present circumstances, President Obama’s therapeutic regimen represents, with a very high probability, the very medicine that will strike a mortal blow to the patient — in this case the US economy”.

    Speaking of stimulus packages in general, German Financed Minister Steinbruck says its money spent that will be lost. Although Germany subsequently initiated its own smaller stimulus package. On the other hand, last years Nobel Prize winner for economics, Paul Krugman said in a interview recently that Germany needed a stimulus to improve the German and European economies. Speaking of the USA , Mr. Krugman said, “We need a huge stimulus in the United States — intervention in the mortgage market to lower rates, plus 4 percent or more of gross domestic product in recovery measures”.,1518,596520,00.html

    Krugman did not specifically addressed how to deal with the banks, but I don’t think he would side with Mr. Vakkur. After Lehman Brothers was allowed to collapse several respected people said if it had been saved, the economy would not have spiraled out of control. Lehman’s bankruptcy started the steep decline of the US economy.

    Citibank is one of the biggest banks in the US. Like others it is on the verge of collapse. If this happens, it would be catastrophic for the USA.

    The question is what to do and the problem is no one really knows for sure what will work. Some experts think they know and their are other experts that disagree. Steinbruck vs. Krugman is an example of this. Its like a dying patient who was told for years to stop smoking. He didn’t listen and now he’s too far gone to be saved.

    The USA has been borrowing heavily from other countries for years in order to maintain our standard of living. We borrow money from the Chinese and Japanese so that our citizens can buy the products they export to us. This is idiotic and contradicts what good parents teach their little children. You save your money and only spend what you have. Avoid debt. The problem is many individual Americans behave as irresponsibly as the government.

    We are in a mess. But Obama did not create this mess. This whole fiasco can be laid at George W. Bush’s feet. He took over an economy that had been flying high and ruined it with his wars and incompetency.

    The USA attack on Iraq resulted in the murder of more than 1 million Iraqi’s. If the only thing that happens to the US is that it becomes a second rate power, Americans can consider themselves lucky.

  11. Tennessee-Chavizta said on March 5th, 2009 at 8:29am #

    Brian Koontz: u are 100% correct. But isn’t this notion that all capitalist countries are more or less like USA. Mexico, Peru, UK, India, China are not nation-states ruled and represented by populist social reformers but instead by Multinational Corporations via Corporate-puppets and corporate political parties? So i think that this is a worldwide phenomenon not just USA. David Korten explains it in his book “When Corporations rule the world”


  12. Ramsefall said on March 5th, 2009 at 8:39am #


    it seems that you contradict yourself by saying, “The problem is many individual Americans behave as irresponsibly as the government.” Then you continue by saying that “This whole fiasco can be laid at George W. Bush’s feet. He took over an economy that had been flying high and ruined it with his wars and incompetency.” So who’s to blame, the people or W?

    Do you really believe that W was the only war mongering president in Amerika’s history? ALL US presidents have possessed this ugly characteristic — and war has been Amerika’s most lucrative export for decades, and now the past catches up with the present.

    Brain K,

    while it does seem nuts based on typical logic construed from what is seen on the surface, you’re correct about the elite’s allegiance to profit…at any cost. From the public’s perception, military spending and war exportation is an absurd waste while the multinationalist mentality justifies such behavior unconditionally.

    The best point you made, Amerika is not controlled by Amerikans, it’s controlled by monetary profiteers, a hard pill to swallow for most of the public, too contradictory for their taste, disrupts their entire, ingrained belief system on how the world operates.

    Best to all.

  13. Tennessee-Chavizta said on March 5th, 2009 at 8:56am #

    Ayn Rand (1905-1982) said in her book Atlas Shrugged: “When you see that trading is done, not by consent, but by compulsion – when you see that in order to produce, you need to obtain permission from men who produce nothing – when you see that money is flowing to those who deal, not in goods, but in favors – when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you – when you see corruption being rewarded and honesty becoming a self-sacrifice – you may know that your society is doomed.”

    Banks and corporations run a centralized, metastasizing entity, disguised as the federal government. Their objectives are promoting war while financing both sides, confiscating people’s money and resources, and propagandizing the naïve masses to maintain and perpetuate their power. Our two main political parties are their servants, government departments are the spending agencies, and the Internal Revenue Service, a private offshore corporation is the collection agency.

    Thomas Jefferson said: “I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”

  14. Peter said on March 5th, 2009 at 9:06am #


    You asked, “who’s to blame, the people or W?”. In my opinion, the American mindset is to blame. But individuals control their own household. They have the power to buy things they can’t afford and get into personal debt or bankruptcy.

    The President has control over the biggest economy (for now) and more money than any other individual in the world and can destroy the country’s economy . Thats what Bush did, put us into huge debt and destroyed the biggest economy economy in the world. As the man in charge he gets the credit when things go well and the blame when they don’t.

  15. Don Hawkins said on March 5th, 2009 at 9:27am #

    Thank’s Tennessee

    Ayn Rand (1905-1982) said in her book Atlas Shrugged: “When you see that trading is done, not by consent, but by compulsion – when you see that in order to produce, you need to obtain permission from men who produce nothing – when you see that money is flowing to those who deal, not in goods, but in favors – when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you – when you see corruption being rewarded and honesty becoming a self-sacrifice – you may know that your society is doomed.” Read DV Barrack

  16. Tree said on March 5th, 2009 at 9:37am #

    I think a good indication of a doomed society is when people quote a god-awful writer like Ayn Rand.

    I take exception to this piece as it posits the collapse of the US economy but does not provide any research, facts or figures. Therefore it’s an opinion piece and it seems the only things worth less than GE stock these days are opinions.
    Articles like this only add to the bonfire of the vanities and encourage the Savonarola’s in our midst.

  17. Don Hawkins said on March 5th, 2009 at 10:23am #

    Tree what Rand wrote there is it true? Take a look around what do you see. How are things going in the real World. The people who she wrote about don’t live in the real World well it is to them but them and only them.

  18. Tennessee-Chavizta said on March 5th, 2009 at 10:35am #

    I am not capitalist-libertarian, i am socialist, however i am not a dogmatic-socialist. We still should read capitalist-writters and should learn from capitalist-thinkers, some of their positive points while neglecting their negative points.

  19. Don Hawkins said on March 5th, 2009 at 10:51am #

    The real World is just that real. The people who now run the means of production and the media do they listen to there own stuff I don’t thing so. Although they should because there thinking effects them but they think it doesn’t. Funny how that works. Kind of a optical delusion of consciousness. Millions of words written on this and so far still the same.

  20. Max Shields said on March 5th, 2009 at 11:55am #


    The truth is there are no facts until “after the fact” so to speak.

    That is why we search of fundameyntal universal principles to use as compass or tuning fork. Whether it is science or religion, there is always uncertainty with is bound in a kind of faith, whether in a methodology (empiricsim) or theo-logical attempts to prove the existence of that which is beyond proof, we are always somewhere between knowing and uncertainty.

    Economics is no less the imperfect ‘science’ (is it even a science?). Science is not all about laboratory experiments with repeated outcomes. That’s ideal but rare except in microbiology and some physical cause and effect (controlling variables and the like) insinuation.

    When you discover a universal principle, it seems to strike you (at least me) as if there is something to hold onto, that it is not all about probabilities and statistical variances (or worse).

    These principles emerge out of historical repetition and outcomes across cultures (horizontally) and within localities (vertically). What is more they seem to explain trends and how things operate in nature (of which we are inextrically apart).

    Basic economic principles are that it takes three components to make wealth (wealth is not money, but tangible outcome): land (natural resources) + labor + capital. All three are necessary and sufficient.

    Financial services are not central to an economy. It can support an economy or become a parasite to an economy (bubbles, collapse, concentration of wealth).

    When one talks about a real economy or a local economic engine it functions on these principles PLUS the idea of export and import. A balance of trade is all about having a robust export to pay for your needed imports. A principle of local economics is that it looks to replace imports wherever that is feasible and to turn those internally produced goods/services into local consumption with the opportunity to export. This is a principle upon which ALL healthy economics has worked for thousands of years.

    Currency runs under another principle. A currency’s value should reflect the balance of trade described above. The value of a currency then is part of a feedback loop that tells an economic area whether it’s trade balance is positive or negative (or something in between).

    These are principles. Principles can be exported, they are universal and work everywhere.

    Processes are different. Processes emerge out of indigenous innovation. When exported, except for the simplest and least valuable processes, they rarely take hold – again, they are indigenous. So exporting industry to Iran (under the Shah) failed miserably, even when there billions poured in and immense training programs. That is because the processes did not emerge locally. This is what happens to economies all the time. This is called remittance or transplant economies – it doesn’t work. Which is why “shock therapy” used by neoliberals in Russia and South America blew up. It’s why when Peter the Great imported Western industry it all failed miserably.

    It is what happens when billions of dollars are poured into New Orleans and the City remains a shambles. If NO had instead identified indigenous local economics, building from the inside out…the story would have been more like San Fransico after the great earth quake.

    The principles are the same. They are natural, much as thermodynamics will not be refuted.

    When an economy, like the US drifts far far far away from these principles there is a kind of mind-boggling chaos. No one understands how it works. It continues to function because there is NO US economy there is a global economy. National economics has imploded.

    The real hope is local economics. With local economics you can rekindle the principles that have been known and used for thousands of years.

  21. Max Shields said on March 5th, 2009 at 12:21pm #


    What I’m saying, in sum, with the above, is that the further you move from the fundamenal universal principles that govern healthy sustainable economics, the more you can be assured that there will be some form of a collapse – unless the situation is re-calibrated.

    When the Gov’t pours money into the financial sector, a non-producing service, it is pulling a lever which is worse than counter productive, it is actually driving the fundamental real economy ever deeper in debt. It detracts, along with wars, the use of non-renewable resources as well as human energies and existence to an enterprise that is failed.

  22. Tree said on March 5th, 2009 at 12:39pm #

    Max, I can’t give your comments the time they deserve right now but I will definitely re-read them later this evening.
    My point was that anyone can say the US economy and/or the US as a whole will collapse. It’s not like there’s a lot of encouraging news out there, that’s for sure. But, just because we can say that doesn’t mean we are correct. There can be many reasons for this belief, as exhibited here in the various comments. I question anyone’s motives for saying this as it appears that many are lying in wait like a bunch of vultures for the collapse of the United States and often as they rub their hands with glee they are talking about “solidarity.”
    So why should I take this article seriously when there are few if any facts, figures, etc. but primarily someone’s opinions?
    I know things are bad but they’ve been bad before. A cursory look at US history shows quite a few depressions and recessions have occured and the country recovered from each of them.
    Underlying all this is my belief that yes indeed, things are getting bad and they will more than likely get worse so people need to get their shit together, get their facts straight, stop running around like the sky is falling and form a unified front for what lies ahead. This is of course totally idealistic but it’s what I think. A sense of humor doesn’t hurt, either. And letting go of one’s ego.

    My other point was that Ayn Rand sucks. The fact that someone can pull something from any of her enormous soap operatic tomes that makes sense to them is equivalent to the theory of putting a bunch of chimps together with a bunch of typewriters. Eventually something close to making sense comes out of it all.

  23. Max Shields said on March 5th, 2009 at 1:34pm #


    I don’t think this is a case of “wanting” or “wishing” the demise of anything in particular. Certainly, the US has been on a binge with war as its calling card, and there is a tendency to feel that greed will have its day of reakoning.

    There are two schools of thought in terms of outcomes: 1) is that there are choices. One would be a significant reduction in life style and affluence by achieving a steady state economy (opposite of a growth based economy like we have). The other choice is to go full throttle with hyper-growth and feed the bubble (finance sector) which is what the O administration is doing with the hope that it will re-ignite the economic engine (problem – it is NOT the engine). This would predicatably lead to collapse if continued without restraint.
    2) the other school says that no matter what O does, the natural limits will create breaks and all things being relative the US will still be the dominate economic player. The latter would be the case because of the global economy which has supplanted the national economies. So, when the US sinks, it does so with all the other economies. The net is the overall life style will change for all.

    Now does that mean collapse is inevitable? From what I can gather our opportunities to push back and create a steady state economy one not based on hypergrowth (or any growth) past us by a couple of decades ago according to the models that various global NGOs have independently run.

    Do we know for SURE? Well we know that thermodynamics is a force not to be questioned. We know that natural energy sources CANNOT be replaced and the planet is finite with regard to life giving atmospher. We know that while technology can leverage energy it CANNOT MAKE energy.

    We know what the throughput is to this system and that it is unsustainable. Obama and his administration is NOT dealing with this reality (or at least the reality as best the human mind can discern).

    War is not the moral, economic or environmental answer – it is the VERY opposite. And it is the war-theory of economics that Obama seems to be pursuing along with pouring money into the zombie financial sector.

    With this it is fair to conclude that collapse seems imminent. Do we know for sure? It looks more certain than most other scenarios.

    As far as Ayn Rand…I totally agree with your assertion, Tree.

  24. Max Shields said on March 5th, 2009 at 1:42pm #

    To punctuate the point of collapse. Collapse can happen through careful transitioning to smaller, self-sufficient steady state economies or naturally (and much more painfully for all).

    Either will not be easy. In fact it will be very very difficult but if approached as a transition from a growth to steady state, life could become much more fulfilling that the consumerism we’ve grown into.

  25. Barry said on March 5th, 2009 at 1:47pm #

    Our economic problems certainly pre-date Bush. It was the Reagan Administration that adopted – celebrated – the free-market policies of Milton Friedman. These policies have continued to date, reaching their fruition with the W gov’t actually funnelling the people’s money over to favored corporations by the barrelfull and were within a hair’s breadth of turning our SocSec over to Wall Street sharks. Part of this major league swindle is to suppress wages while at the same time demanding that we spend all our money. So we have had too little money chasing after ever more goods and services for some time now. The chickens have come home to roost on this – the majority of Americans are getting closer and closer to being one paycheck away from financialcollapse – while their credit cards are in deep double digits. That’s just one of the intractible crises of capitalism – hammering away at wages while demanding maximum expenditure. The people cannot, by and large, be faulted for this. By the time we are adults we have seen literally millions of commercials telling us how to spend our money. Ever see commercials that promote delayed gratification or saving for a rainy day? Capital is very good at getting us to part with cash. If it didn’t work they wouldn’t advertise.
    Capitalism as we know it will of course collapse some day. And US capitalism is odds on to already be past its peak. Chinese capitalism is in the ascendency, as we shall see in the coming decades. But that too shall pass. No telling what will emerge from the embers.

  26. Barry said on March 5th, 2009 at 1:56pm #

    I don’t know about a transition to steady state economics. This capital thing comes with troops – and they will use them. The people who run the show are not about to forego short term profit in the interest of a better life for all. As we speak, their is a White House forum that is at the beginning stages of how to maximize insurance company involvement in our health. There is really only one advocate for single-payer at this forum and he got in only because lots of people were screaming. What is true of the public health sector is true pretty much across the board. Its in the hands of capital. And there is no telling what would galvanize a population to refuse to take it anymore, we are all working towards divergent goals.

  27. Ramsefall said on March 5th, 2009 at 2:21pm #


    from what you’re saying, in order to move forward and avoid more pitfalls like we are presently experiencing, what’s required is an evaluation of the past and how economies began — locally. Time to adopt the 80-90’s mantra of thinking globally while acting locally.

    Instead of local, monetary economics though, how about local, resource-based economies? I believe that one of the central problems associated with a monetary system is the inherent greed that is produced to amass more money in order to attain more resources — whatever they may be.

    Natural resources on the other hand, are finite like money, and also like money many are renewable. The primary difference is that renewable natural resources never lose their intrinsic value because of man’s dependence on them for survival. Money doesn’t really have any value, it’s superficial, although an economic system based on money creates a virtual value. Burn a mountain of 10 trillion dollars and it’s really no loss, burn down 10 trillion acres of forest and major problems develop. Your thoughts?


    a sense of humor is essential at this point in time, as is reducing the effect of one’s ego which intentionally misdirects mankind from reaching the center of consciousness and connecting it to the subconscious.

    Yes, we have seen recessions and depressions, the difference today is the compounding effect on global society which for some time now has been inexorably linked, hence the ripple effect being felt from the epicenter. Another difference which points to a coming devastation never before seen is that the dollar has lost roughly 94% of its value since the last, great depression on which Steinbeck so eloquently trapped in time. Once inflation begins to really kick in, the remaining 6% of the dollar’s value will be lost most expediently. While much of the doom and gloom of the coming collapse is based on contagious hysteria that feeds itself, rational speculation can be made based on past events like the 30’s and where the dollar and its consumer-based society have come since then.

    Either way, I couldn’t agree with you more — people definitely need to get their shit together, if it’s not already too late. Some good options may be to geographically relocate oneself abroad, for the once “greatest nation on Earth” won’t be making a comeback any time soon. Rational behavior is the only thing, aside from a little luck, that will save people.


    there you go, now you’re talking — Amerikan mindset, aka selfish capitalists who were only busy thinking about frivolous ways to bring about a false sense of happiness was the problem that led to this collapse, along with a truly corrupt system of string pullers and plastic CEOs. It should be no surprise to anyone that Amerika has arrived to its present destination known as inevitability.

    Best to all.

  28. Max Shields said on March 5th, 2009 at 2:42pm #


    Yes, it pre-dates Bush, but the problem is not simply a “free market” ala Reagan. Choices and decisions have been made all along the way.

    Steady state is not a “capitalist” notion. I think we get trapped in these issues from an ideology perspective and then can solve the problem because we’re boxed in around these quasi religions of Marx VS Smith.

    The beauty of thinking this through from as systems perspective is that it allows you to step outside the ideologies to try and think clearly about the problem rather than to cram it into a narrow lens.

    Barry, I have clue what you mean by “steady state” with regards to capital and troops. You’re conflating opposites and it makes no sense.

    I don’t think, though it’s easy to demonize, that it is purely a capitalist issue. I would say much of it is about neo-classical economics and the sup’d up mathematical models that led us astray into hypergrowth (yea M. Friedman exemplifies).

    Industrialization and the trajectory it has taken is a central culprit. Industrialization is neither a socialist nor capitalist invention. Marx and Smith were comfortable with it. But in a larger, systems scheme, one that was not as central in the 19th century, industrialization as we know it is part of the endless growth pattern which is unsustainable. Soviets consumed less than Americans, but they too were wed to the notion of growth.

    An economy that demands endless growth as a solution to poverty creates an unbearable dilemma for the planet and survival. We simply cannot GROW out way out of these problems or into prosperity. That has been the American neoliberal mantra and it doesn’t work.

    Barry, as far as the people who run the “show” conceding anything, you are right. Transition may not be possible without struggle, but it needs to be recognized.

    Until we get out of our ideological bags, the problem will persist, and crash. The reason why the system exists is because it works for some people. Those people have power.

    So what to do? The answer could be armed struggle…but then what? or it can be just to let it collapse and have nature determine the outcome, or we can find ways, small and large to transition from what we have to a new system as the old one collapses and can no longer support the old notions.

  29. Barry said on March 5th, 2009 at 3:31pm #

    Well, Max, I still think its capitalism. As you say, Marx had no problem with industrialization, his dog was about ownership of the means of production. And whatever he had to say about the limits of growth, it was not a major thrust. Europe went from what might be called a mercantile period, where it was just beginning to gather in the fruits of the rest of the world, to a capitalist economy, capped off by the industrial revolution and the enclosures of rural land. It is there at that time, with the remaking of peasants into factory proles, that budding capitalists began realizing economies of scale – both for production and consumption. It is at this time and place that capitalists began accumulating profit – not just to live well – but to expand their firms, to gain a larger share of the market. This is indeed a process requiring endless growth, so as to stay ahead of falling rates of profit. And I believe the ‘system’ is helpless to correct itself, and that we cogs in the system are presently very limited in our ability to manifest change. In fact, most of us think that change is epitomized by things like recycling paper or by recognizing diversity in the workplace, etc.
    I agree that steady-state is not a capitalist notion, in fact, it’s quite anti-capitalist. Which is why if capital is threatened by alternative economic systems – the state will (and already has) call out the troops. No society, whether small scale (Burlington, VT?) within the limits of developed world borders, or large-scale, say North Korea, is permitted to permanently pull out of the system of capital penetration. Iraq, which never even pulled out, is finding out right now the limits to economic self-determination.
    Capitalism is very dynamic. Soviet ‘socialism’ was not nearly so dynamic and central planning a country of over 8 million square miles proved too much. Those advocating steady-state economics have to impress upon people the benefits of living within our means rather than continuing to consume – but it is like asking people to escape the bonds of feudalism – how does one even imagine it? And at least capitalism holds the benefit of transient pleasures – something even the poorest are not keen to part with. We are bought off . By Neflix, ethnic restaurants, designer clothes, nicer cars, and the internet. Whose got the time or inclination to revolt? Yet, even as we speak, there are riots around the world protesting the state of economics and governance. But basically, people are fighting to make the system work better for them, not really to change it.
    I do think that we all have to analyze it, rail against it, and organize. I don’t have any reason to believe however, that we will take concerted and collected action against the system. In fact, we don’t know what crystallizes a movement. I think it will collapse of its own accord and perhaps something god-awful worse may even emerge. Its not like have-it-all societies will be any more willing than now to share the remaining resources.

  30. Tennessee-Chavizta said on March 5th, 2009 at 5:06pm #

    Barry: In order for socialism ideology to succeed in this world, socialists parties in this world have to rise to power, transform the media, convert the media ideology from capitalist, free market ideology toward socialism, spread socialism propaganda to the masses, and anti-capitalism propaganda. In other words, socialism has to become a ‘mainstream politically correct ideology’ in the eyes of the masses.

    Right now the mainstream thinking all over the world is capitalism, and communism and socialism are still in diapers and alternative unpolitically correct ideologies. Another thing is that socialism has to suceed at least in a couple of countries like in Venezuela, Bolivia, Cuba their populations have to accept it, love it, and be happy with socialism, so that other countries populations demand socialism in their own country.

    Like oppressed americans here in USA, have to realize how socialism is increasing the living standards of venezuelans, and connect the dots, of how socialism would increase the living standars of the american population. Because we all know that capitalism is making americans poorer (at least this stage of capitalism which is neoliberalism)


  31. Tree said on March 5th, 2009 at 5:14pm #

    Max, you present some very smart and interesting points in your comments here, ones I did not see in the article. No offense to the author but I wish I had seen more of your kind of theorizing.
    As for your statements on what Obama and his Admin. are doing to the economy, I would add it’s his own version of Shock and Awe and we all know how that turned out the last time.
    By the way, I’m a moron when it comes to grasping many of the economic theories. I do try but at some point I hear snoring noises in my head.
    However, I don’t think Capitalism is bad, per se. What’s “bad” is how it is used by unscrupulous, greedy people. Pretty much everyone has these tendencies and pretty much any kind of economic system is abused.
    If anything, the worse thing about Capitalism is the way one action easily builds upon another so that what starts as a most basic transaction turns into a leviathan of a system full of corruption, bureaucracy and stupidity. This seems to be how humans operate nearly all systems of thought.

    Ramsefall, where to move to? I have ignored a nagging feeling to get my passport for a while now and I’m not sure there’s anywhere better to live. Suggestions?
    How would you see local resource based economies working? This strikes me as extremely limiting and a situation ripe for wars as people who do not have a particular resource attack those who do…which is pretty much how things are anyway.

    Max, Barry and Ramsefall, I don’t always agree with your comments but I truly appreciate the intelligence and rationale that goes into them.

  32. Ramsefall said on March 5th, 2009 at 6:16pm #

    I have many suggestions for you, Tree, but the right one depends on your perspective of the word “better”. If by better you mean where the economic impact won’t be as strong, I’d say anywhere in what is considered the underdeveloped world; mainly L. America or parts of Asia, considering the state of Africa and the M.E. My reasoning; Amerika’s fall will be unprecedented in comparison because it’s been such a wealth-based, industrialized nation for so long now, while the underdeveloped nations have much less to lose and more to gain.

    From the French you’ve sparingly used in past conversations, maybe an island in the Caribbean, France, Belgium, Switzerland, Canada, etc? I guess it depends most on the degree of interest you have to see the world outside of the Empire, which provokes an overall change in one’s perspective… as you might expect. There’s a whole world outside those borders, and while capitalism is homogeneously the platform for daily life, the cultural aspects could induce an unknown sense of creativity to write in your foreign language based on your societal observations, or something else considered to be worthwhile.

    As for local, resource-based economies, it could easily be considered Utopian and would require an overall, collective leap upwards in consciousness — I’m not certain as to the likeliness of that occurring — along with which comes a different lifestyle. Although if it were to happen, the human objective would be to treat humanity humanely, taking comfort in knowing that your neighbors’ needs are met, that the Earth is being treated with respect, and so forth. But as Max has countlessly pointed out, that may take a huge population drop to actually implement it successfully and sustainably. It something that may seem like a crap shoot to many, but in the realm of all possibilities, what’s not possible?

    It would be more beneficial to habitually project what we want, instead of focusing on what we abhor. I pay much less attention to all the chaos and disharmony going on in the world than I used to, in fact, I used to become physically and emotionally sickened from giving it so much attention daily. Removing myself from the good ole US of A has precipitated a shift in attention. For myself, expatriating was the smartest decision I made after the longest preparations of my life. Would that be your case? You won’t ever know unless you try it…and when life’s all over, you won’t regret the things in life that you did, so much as the things you didn’t do.

    Always open to discourse on the subject with you, Tree.

    Best to you.

  33. Tree said on March 5th, 2009 at 7:06pm #

    Ramsefall, I would appreciate anything you could tell me about moving abroad. If you don’t mind, please email me as I don’t want to take up too much comment space here on the subject. Tree201@aoldotcom

    As for not paying attention to current events, I can totally relate to that. It’s only been in recent months, and primarily here, that I’ve re-engaged in my interests in such things. I have to say, I prefer it the other way for a variety of reasons.

  34. Pauli said on March 5th, 2009 at 7:23pm #

    “–but what happens if the gambler (or insurance company) cannot pay its losses when it (he) loses? ”

    Me and Tony Soprano come around and a breaka your legs!

  35. Max Shields said on March 5th, 2009 at 7:44pm #


    I think you are missing the essence of my point. The problem is not simply industrialization. The problem is the extreme difficulty of the human species to function within limits. Deforestation is a phenomenon not entirely unique to the human species but it is only the human species that so devastes the planet. Humans require an immense amount of resources, even those in tropical areas who consume a fraction of Northern tribes. That consumption produces waste and pollution unlike no other form of “wild” flora or fauna.

    The inclination to colonize and destroy great swaths of the planet pre-dates capitalism. But without a doubt, it is industrialization which expontentially expanded the exploitation of the earth.

    But this is true in “Communist” China and the Soviet Union. It was true in Cuba before the collapse of the Soviet Union.

    This is not purely a Socialist/Capitalist phenomenon. And so the problem cannot be solved by simply ridding the planet of capitalism (a feat which will probably not happen).

    A localized steady state economy is workable, has been workable and can provide the orientation of transformation.

    Marxism doesn’t exist. I think Venezuela is doing some very postitive things as has Cuba in recent years. And there are other places as well, but to say that they represent Marxism (not saying you are) would be very wrong. There is capitalism throughout all of these nations. My arguments is not “anti-Marx”, I think he made some very important observations and provided useful analysis.

    What humans have is the ability to reason, observe, analyize and make course currection. The problem arises when the system is so overpowering so as to make correction nearly impossible.

    I don’t think that is a ‘capitalist’ issue. The issue of monopolies and privitization of the commons (Hardin’s Tragedy of the Commons) requires public domain/government to function for the good of the commons not of private interests. I don’t think it is capitalism that creates the corruption we see with our public officials when they cozy up to big money. It is not in the interest of “capitalism” to undermine democracy. On the other hand, capitalism as we know it has led us to a dead end, a treachorous dead end.

  36. Barry said on March 5th, 2009 at 8:57pm #

    Max – Humans as a species have been capable of seriously altering their environment for the quarter-million years of its existence. But as long as humans lived in band societies, environmental abuse was pretty much kept in check. Agriculture changed all that – it totally rearranged the relationship of humans to nature. With agriculture came land ownership, other property, class hierarchy, slavery, national religions, human deities, poorer diets, longer work days, larger families, a warrior class – and a host of other attributes we take for granted are ‘natural’ to the human condition.

    Basically, I think the downfall of humanity started with agriculture. Industrialization – including industrialized agriculture – followed in the footsteps of agriculture.

  37. Max Shields said on March 6th, 2009 at 5:59am #

    Interesting. Agriculture relative to the practice of horticulture is problematic. But the carrying capacity associated with humans exceeds that of nearly all other existing species. Humans are fragile and yet have extended themselves through the use of clothing, shelter and weapons. This was all amplified by energy providing humans with a means of existence which far exceeds the capacity of the human body.

    But with these capabilities has been the great environmental price.

    You may want to check out permaculture in terms of a transitional form of farming, building and living.

  38. Deadbeat said on March 6th, 2009 at 11:36pm #


    Here is an article on permaculture that ties very neatly with Marxism. Ironically the article is written by another Barry (Healy) for the New Left Review.

  39. Max Shields said on March 7th, 2009 at 4:58am #

    Deadbeat returns! Bill Mollison never connected it to another economics. Why? Because permaculture provides an economics.

    That said, Cuba used permaculture and other organic farming methods to transition out of the Special Period (Peak Oil). And it worked!! But it is hardly meant to be a Marxist adaptation. In fact, small independent farms were intoduced as well as cooperatives…again hardly Marxist.

    Hundreds of African villages are using permaculture, community urban farms in New York City, Australia, England, and on and on.

    It is an alternative life style to the consumer-based hypergrowth economics of the West.

  40. Tennessee-Chavizta said on March 7th, 2009 at 8:17am #

    Max: The problem is that the capitalist-system itself concentrates wealth in a few, even if those few rulers capitalists are honests and well intentioned. That’s why all countries with capitalist systems are not economically democratic but “Dictatorships of the elites” like Marx stated.


  41. Max Shields said on March 7th, 2009 at 9:19am #


    I appreciate what you’re saying. Let me give you an example of what I’m trying to say. First, I think Venezuela with Chavez has made important changes, deep, democratic, in just about every aspect of policy in that nation.

    I think what happened in Cuba post-Special Period is exempliary in every way. In fact, Cuba is truly a model in many respects for developed as well as developing areas of the world.

    That said, rhetoric aside, what they have done is not Marxist. I’m sorry. It is adaptive, with a deeper understanding of the environment.

    The use of small farm, community gardens, permaculture and sustainable organic growing is NOT Marxist.

    Just because we’ve drawn this historical line around anything or one that stands up to the US as a Marxist nation, perhaps one that espouses Marxism variants vis a vis the cold war, does not mean they are truly practicing Marxists. I don’t think there are any practicing [Adam] Smith Capitalists for that matter.

    I will hark back to points I’ve made before the concentration of wealth is not capitalism. The greatest concentration of wealth comes from unearned income – what the wealthy 1% do. That happens when land and resouces are buried in capital which is the neoclassical paradigm.

    Now to the issue of ownership. I don’t think Marx holds a patent on wrestling with the ethical and moral dilemmas of concentration of wealth. I’ve repeatedly offered on DV Henry George as an alternative. George is neither a capitalist in the sense we use that term today, nor a socialist. He did not set out to create a so called “third way”. He looked at the problem of progress and poverty and from there through a combination of methods reached profound conclusions that WORK when used. I have site case after case of how it worked.

    There is a Georgist school in Venezuela. Chavez by nationalizing (again that’s not a Marxist idea) resources, he is in effect employing the notion that George espoused. In Cuba, for instance, land is given for farming, if it is used for any other purposes it goes back to the state. That is perfectly within the practices of a Georgist.

    Marx did deal with land, but that was years after he had read George. George had yet to read Marx when he wrote Progress and Poverty.

    I will not argue the details of what Marx thought of George. George was praised the world over, and I don’t know what George eventually thought about Marx. But for me that’s gossip and irrelevent.

    I’m not saying that either Cuba or Venezuela have consciously employed Georgist land distribution. I don’t know, but I would be surprised with the economists (and Chavez) are not very familiar with Progress and Poverty. George provides a means to capture land/wealth and distribute it without a violent revolution.

  42. Deadbeat said on March 7th, 2009 at 8:36pm #

    Deadbeat returns! Bill Mollison never connected it to another economics. Why? Because permaculture provides an economics.

    Well Max then you need to argue with the article’s author Barry Healy, the Aussie who wrote the article for New Left Review.

    You say the following…
    The use of small farm, community gardens, permaculture and sustainable organic growing is NOT Marxist.

    According to the author he states …

    Marx didn’t use the word “ecology” — it was coined in 1866 — but metabolism . He argued that capitalist accumulation shatters basic processes of ecological sustainability “by destroying the circumstances surrounding [natural] metabolism”. Marx called this “metabolic rift”. So, he said, what is needed is the “systematic restoration [of natural metabolism] as a regulating law of social reproduction”.

    and …

    Australian-developed permaculture farming principles aim at restoring this balance. Within capitalist Australia, permaculture remains a fringe movement. But in socialist Cuba, it has become mainstream. Viewers of the inspiring film The Power of Community can see with their own eyes the depth of meaning that Marx attached to “healing the metabolic rift”. It is a physical healing of the land, combined with a spiritual rejuvenation of human society.

    and …

    The SSV reported that instead of artificial fertilisers, Cuban farmers use micro-organisms that enrich the soil, earthworms, compost, animal and green manure, and the integration of grazing livestock.

    Unfortunately, Australian agribusiness treats the soil like dirt. Similar to using the earth as a hydroponic growth medium, synthetic fertilisers and pesticides are flung around and water pumped through. Farmers who resist these trends are subjected to financial pressure; meanwhile the soil turns acidic and the rivers choke with algae.

    Another concern for Marx was the struggle over the Corn Laws, which between 1815 and 1846 were tariffs protecting rich British farmers against foreign competition. Manchester-based industrialists successfully overturned the laws to reduce the amount that they had to pay in wages.

    The factory bosses knew that keeping food cheap helps keep wages low. The “reproduction” of labour means workers have to arrive at work with enough food in their bellies to create surplus value for the boss. Cheapening food means that bosses can drive wages down towards a minimum sustenance level.

    But cheap food isn’t always good food: often it isn’t really food at all. In Marx’s day, cheap workers’ bread contained stone dust, chalk, pearl ashes, soap and other such choice items. In Capital, Marx quoted testimony to the 1855 parliamentary inquiry into food adulteration that, because of contamination, “the poor men who lived on two pounds of bread a day did not take in one fourth of that amount of nutrition”.

    What I find interesting Max is how you seem to try to position yourself as being above ideology while at the same time promote your own ideology.

    The problem is Max you haven’t shown where these idea contradicts Marxist Socialism. I’m still waiting for you to present your evidence to the contrary. All you ever do is just make an argument and you provide no supporting evidence.

    Unlike you Max , a reference is provided that argues permaculture being in in line with Marxism. The two are not at odd with each other which has been your argument. You have yet to site a reference with argues your case. I would like to see you site a reference whereby permaculture or any other holistic approaches to agriculture is at odds with Marxism.

    What is clear is that Venezuela and Cuba would not have made any changes had the people not fought to change their government and make the economy serve the needs of her people. That is the essence of Marxism — seizing power and using that power to end exploitation and to serve the needs of the people. That is the only way any real ecological advocacy will proceed and succeed on a mass or world-wide scale. Power must be seized and exploitation ended.

  43. Max Shields said on March 8th, 2009 at 7:53am #

    New Left/Old Left (wasn’t it the new left that gave us the NEOCONS!!!),

    Point, don’t really care about leftism. It’s a prisim that keeps solutions at bay while fighting old, irrelevent battles.

    Making the economics of sustainability a Marxist paradigm is like WalMart going “green” (slight hyperbole).

    Look, if we’re going to wed everything to Marx, why not Jesus?

    Jesus would have LOVED permaculture and probably, you’ll find ‘references” to that effect…though they didn’t call it “permaculture” waaaaaaaayyyyyyyyy back then. [irony]

    The point, Deadbeat, is still the same: Permaculture is NOT Marxist. It may not be “anti-Marxist”, but it is quite certain that Bill Mollison was not reading Marx when he came at this problem.

    Now is it capitalism? NO. (When you have a hammer, DB, everything begins to look like a nail.) It is both simplistic and dogmatic to tie Marx to permaculture no matter whose article you reference.

    As far as references, I’ve supplied many. One article does not a case make.

    I will say this, a sustainable world will require a major shift from forms of competition and hyper-individualism to community and collective. In that sense both Jesus and Marx were right. I don’t think Marx would have been as keen about permaculture and the life-style it purports. First, permaculture is NOT about a linear cultural evolution which required stages of capitalism to achieve.

    Permaculture is about limits to growth. It is a systems view of feedback loops and balance. Marx was NOT anti-capitalism so much as seeing the necessity to move passed it to the next “stage”. The very spirit of permaculture is not that we are simply in a pre-determined stage, but that we are in an unsustainable growth pattern that will end – either through the efforts of movement and planning (transition) or because natural forces will pull the plug (collapse).

  44. Don Hawkins said on March 8th, 2009 at 8:02am #

    How about
    We will take it from here. I know easer said than done.

  45. Max Shields said on March 8th, 2009 at 9:02am #

    Permaculture took hold in Cuba because the Cuban economy and food system had collapsed. People were starving. Not because Castro had once claimed Cuba, 40 years earlier, a Marxist nation.

    I will say this: Cuba is a small island nation. By shedding the colonialism of the mid-twentieth century symbolized by the Batista dictatorship and US hegemony, it was positioned to best use the tools of permaculture. But Cuba needed to go through profound changes, and did so out of dire necessity. This is not due to Marx or Marxism or Dialectics.

    While it could be inferred that permaculture is an alternative (reaction?) to capitalism in Australia, I think it is clear that it is a reaction to global hyper-growth in general.

    What exists as the dominate economic system is pure speculation and monopolization of the commons (nature) by a few.

    This is a pathology. We know it is not socialism or communism. Experiments in communism have not survived on large scales, in fact in most respects they are utter failures as economies and human quality of life. Scale is very important. Small entreprenurial communities with workers’ coops and community businesses are neither capitalism nor communism.

    Permaculture is a re-connection of human existence with nature; a complete jettison of the trajectory of thousands of years of empire which culminated in the recent forms of US Capitalism or Soviet Communism.

    To, dig through, as academics will, the writings of Marx and Engles, to uncover a connection with ecology, dialectics, materialism is simply an attempt to make Marx relevent. As an academic exercise, fine, but let’s not get lost in these exercises which create distractions from the work at hand. (The rightness or wrongness of Marx is not the real issue.)

    I am less optimistic for large nations like China, US, Russia in trying to grapple with the issues of population (central, btw to permaculture) and the attraction to economies of scale which leds to mega-farms, and WalMarts. All this will need to change. Bio-regions, local democracies and economies will need to replace them. I think there needs to be much greater community-based and owned businesses, and local cooperatives, and public “owernership” of natural monopolies. The basics of classical economics will need to re-emerge within the context of steady-state. If you can only translate this by reading Marx, so be it, but I think it is an unnecessary obsticle to clear, straight on understanding.

  46. Deadbeat said on March 10th, 2009 at 10:06pm #

    Max Shields writes…
    Permaculture took hold in Cuba because the Cuban economy and food system had collapsed. People were starving. Not because Castro had once claimed Cuba, 40 years earlier, a Marxist nation.

    I will say this: Cuba is a small island nation. By shedding the colonialism of the mid-twentieth century symbolized by the Batista dictatorship and US hegemony, it was positioned to best use the tools of permaculture. But Cuba needed to go through profound changes, and did so out of dire necessity. This is not due to Marx or Marxism or Dialectics.

    On the contrary, Marxism ALLOWED Cuba TO TRY ALTERNATIVES. This once again reflects Max’s desire to DISPARGE Marxism in favor of whatever ideology he chooses to promote. That is the why Max misses the point of Marxism and the article that was written by Barry Healy for the New Left Review aligning permaculture with Marxism.

    The two ideas are not at odd as Shields attempts to argue. In fact he has presented no references to support his premises with when you think about is very anti-Marxist because Marxism is grounded in reasoned, supported, rational, logical and scientific argumentation which is the heart of dialectics.

  47. Deadbeat said on March 11th, 2009 at 2:25am #

    Also to follow up with a very important point that Mr. Healy makes regarding permaculture …

    Australian-developed permaculture farming principles aim at restoring this balance. Within capitalist Australia, permaculture remains a fringe movement. But in socialist Cuba, [permaculture] has become mainstream. Viewers of the inspiring film The Power of Community can see with their own eyes the depth of meaning that Marx attached to “healing the metabolic rift”. It is a physical healing of the land, combined with a spiritual rejuvenation of human society.

    The fact is without Marxism, permaculture will remain small, localized, isolated and for people “rich enough” to drop out which means essentially fringe and elitist. Permaculture will not be and cannot be deployed for the masses without a profit motive unless Capitalism is stamped out. Therefore permaculture will only become viable on a world-wide scale when there is a revolution by the proletariat for the proletariat and new ideas are giving a chance for the benefit of society rather than for the few who profit or via the exploitation of the masses as well as nature.

  48. Max Shields said on March 11th, 2009 at 6:42am #

    Deadbeat, the “creator” of permaculture is Australian and Australia, Canada and places throughout the USA use permaculture. None are Marxist and the USA isn’t particularly communal in its cultural habits, except here and there. It will take a noticable collapse of the global food system scaled to what happened in Cuba, to make permaculture more integral to our food system.

    As far as permaculture being isolated in non-socialist/Marxist countries, that’s a bogus argument. We know of one nation, a tiny island (Cuba) that uses permaculture WITH a mix of other forms of farming. It is not the predominate form in Cuba, it is integral. So, let’s not exaggerate the situation. I think permaculture is great. I think it has much to offer, much which will be needed by all. There are African villiages (not particularly socialist in any doctrinaire way) that use permaculture.

    Cuba is an island nation that met up with an artificially induced peak oil situation. Those are facts. I don’t want to get into chicken and egg stuff like was it the nature of the Cuban people that allowed socialism, or the other way around? But that’s the road your argument takes this.

    The situation in Cuba as discussed in that fine film you mentioned (The Power of Community) make NO mention of Marx or socialism. It was a profound and necessary transformation, one the Cuban people wanted to share with its neighbors (including the hegemonic power to the North).

    As I’ve said elsewhere, I find the spirit of the Cuban people refreshing. I There is little doubt that permaculture is a major divergent from capitalistic mega-farms. It is not based in Marxism, though it does favor cooperation over competition.