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Fannie, Freddie, Subsistence Farming and You

“More than at any time in history mankind faces a crossroads. One path leads to despair and utter hopelessness, the other to total extinction. Let us pray that we have the wisdom to choose correctly.”

Woody Allen

By now we know that bailing out the mortgage mess to the tune of…we don’t know how much but it will most likely be measured in trillions…is our lot in life.  While I hope we have been complaining about this to our representatives (if only for pro forma’s sake so that we can tell our grandkids “yes, I complained when they sold you and your future down the river”) it looks like it won’t do us much good. 

If you want to know why we aren’t going to be doing a massive build out of wind generators and solar panels so that we can all keep our cars going, our houses heated, etc… this is a good part of why (ok, we weren’t going to do it anyway, but now we’ve decided what stupidity we’ll allot the money to).  Instead, we’ve chosen to hook taxpayers to bail out companies.  Meanwhile, this is unlikely to stop the fact that we’re losing the equivalent of China’s GDP annually in real estate values - or the financial collapse we are rapidly sinking into.  And in a sense, it almost doesn’t seem to matter whether the US ends up defaulting on the enormous promises it is making, or whether it pays them - we’re hosed either way.  Because our ability to adapt in the future depends on not just real dollars, but credit - either way, we’ve mortgaged our future past redemption.   We are likely to drop into a period of severe Depression and financial instability, and on the other side is a life with less energy, less wealth and a whole host of other “lesses” that make up our new normal.

We talked here quite a bit recently about what we might do to make money after our new normal begins to emerge, and John Michael Greer, whose new book _The Long Descent_ was one of the best books I’ve read this year, has offered his own take on the future job market.  I agree with nearly everything he says - nearly everything. And churlish as it is to disagree with someone on the smallest point, who you agree with on every large particular, I’m going to take the time to meditate on at least one of his observations that I don’t quite agree with, because it is something that I think quite does matter in our future.  Greer writes,

Prophecy is a risky business at the best of times, but it’s worth hazarding some guesses about the jobs that will fill the post-petroleum job ads here in America over the next generation or so, through the years of the Great Recession and the disintegration of America’s overseas empire. Farmers are among the most likely candidates for the top of the list. By this I don’t mean subsistence farmers in rural ecovillages – their time is much further in the future, if it ever comes at all. Rather, market farmers tilling what is now suburban acreage to feed the dwindling cities, and rural farmers producing grains and other bulk crops for foreign exchange, will likely be in high demand, along with support professions such as agronomists.

Those who know me well can perhaps guess the bit I’m going to argue with - the observation that subsistence farmers will probably not be needed in this future, or not for a long time yet.  Now it is quite possible that the emphasis here should, in fact, be on the rural “ecovillages” and that I’m misunderstanding Greer’s point.  I’m actually in complete agreement with Greer’s many statements that ecovillages are extremely unlikely to be the dominant - or even a significantly useful - component of future community modelling.  I say this not to criticize those who live in ecovillages, but because as Greer himself has observed, they are simply expensive, involving a lot of economic self-sorting that is increasingly unlikely (if you prefer, you may say that we just spent the money we might have spent on ecovillage infrastructure instead of wind turbines ;-)), and a model unavailable to all but the rich.  Ecovillages also involve discarding the enormous build-out of housing we have just used our wealth for (many, many millions of units more than a society that doesn’t require so much personal space and doesn’t have so much money) and demand lots of credit, which is unlikely to be available.  It simply isn’t going to happen.

But “subsistence farmers” and “rural ecovillages” don’t really necessarily go together anyway, except in a small corner of peak oil rhetoric. If I have any difference with Greer’s overarching analysis, it is simply that I don’t see one thing that Greer describes in his book - communities of people discussing peak oil and climate change who are starkly divided between pure techno-optimist, and flat apocalyptic absolutist, with Greer as one of the lone voices in the middle speaking for the balanced perspective.  Variations on Greer’s perspective seem to me to be the norm in the peak oil and climate change communities - or at least the ones that I hang around in, and have been hanging around in for the last five years.  There is a largish minority (but definitively a minority) of people who imagine a blinding apocalypse, including in this subset a smallish minority who imagine the apocalypse leading to all of us in our ecovillage, and a worldwide majority of people who are mostly too ignorant of the realities to be anything other than techno-optimists while a small minority of these actually know something about peak oil and climate change but retain that perspective.   But the mainsteam of those who are peak oil and climate change  aware seem neither to assume the ecovillage outcome nor the apocalypse, but that they will go on at some varying lower level.  So while it may be a tiny bit unfair, I’m going to call “ecovillage” the least important part of his sentence, and move on to the question of whether the future will involve a lot of us working as subsistence farmers.

Greer is certainly right that market farmers and grain farmers, particularly those growing for export will be a major factor in the US.  As we all know, the US is tremendously energy dependent on a host of nations - and we are economically dependent on them too.  The bailout of Fannie and Freddie to a large degree served to reassure our foreign asset holders that they will be paid (well, maybe…eventually…maybe).  Many of the nations we depend upon economically and for energy supplies are nations that are quite vulnerable to food insecurity for a host of reasons - and in many cases, are seeing that vulnerability exposed, and experiencing internal conflict over it.

Most of the Mid-East oil producing nations, especially Saudi Arabia, are in extremely poor food producing situations - ones that will only worsen with climate change.  Readers of this blog (or the news) will recall that Saudi Arabia has determined to stop producing staple grains entirely, because of the demands upon their desalinated water, and the projections of climate change.  In addition, many of the oil producing regions of Africa are now already experiencing difficulty feeding themselves due to climate change, while China depends heavily on imported food, and holds a good bit of America’s bad paper.

And the US, whatever else its limitations, remains the single largest food exporter in the world.  While it is a mistake to believe the old saw “America feeds the world” - most of America’s grains go to feed not the world’s people, but livestock in affluent countries, it is true that American grain production will be essential to its future economy.  Canada and Russia, exporters of both food and energy, are potentially better positioned for the future, but America’s ability to trade grain for some measure of energy will almost certainly be essential to our future economy.  It may well be the case that often, Americans will not be able to afford their own grain, an irony entirely recognizable to many, many of the nations upon whom globalization was thrust upon.  We shall have to see if the new globalization appeals to us.  With the dismantling of our manufacturing base and the petering out of many of our natural resources, we can expect grain farming for export (or potentially, but much less likely, for biofuel production - more on this in a later post) to be a major feature of the future. 

It was unlikely that I would disagree much with Greer’s vision of market farms created in the suburbs to feed the surrounding cities.  But I do disagree a little bit. It is certainly true that there will be some of this, and that in sprawled out cities that cover a large land base, it is quite possible that urban and suburban farming may provide a large portion of vegetables and livestock for the cities.   In cities that experience a rapid decline, the result may be similar - indeed, urban Detroit is already seeing houses torn down the resurgence of the prairie inside the city - a city that can feed itself with internal resources and a small amount of nearby ones is likely potentially promising.  

In much more densely packed area, near large cities in the US, however, I think even with Greer’s projected “dwindling” (which I think is likely), the suburbs will be quite hard put to feed themselves.  Market gardening in these suburbs and many others (which, as I’ve observed before, in many places have population densities similar to large towns and smaller cities of a century ago) will likely focus on feeding themselves, and perhaps a few market gardens feeding the affluent.  But Westchester County and Long Island and Northern New Jersey  are likely to have enough difficulty supporting their own present populations without being able to support New York City as well, at least until major population shifts have occurred.  In other areas of the country, water is likely to be a determining factor for the ability of external suburbs to support large cities - Los Angeles, Tucson/Pheonix and some other cities are likely to find it difficult to find the water to irrigate crops on individual lots.  And while research keeps showing that well designed and efficient small scale production uses water much, much more efficiently than industrial agriculture, even inefficient agriculture in places where there is adequate rain is likely to be more successful than place mired in chronic drought.  Again, the simple project of feeding oneself and one’s neighbors is likely to take up what water can be found.  There will be some suburban market gardeners near every city, particularly those able to own or claim right to larger chunks of land.  But I suspect subsistence agriculture may well be the dominant feature of our future.

But by subsistence agriculture I do not mean “a household where everyone works as a full-time peasant.”  Worldwide, most farmers either have a second job or a resident or non-resident family member who brings in income.  Most American full-time farmers either have a second job or a spouse or other primary family member who brings in income another way.  In Mexico, it has long be common to send one or two male members of the household to America to produce enough income to support the family farm.  In poor nations around the world, daughters or sons (but often daughters) are sent off to the factories to subsidize the same.  And so it was in the US 100 years ago, when my great-great grandfather taught school during the winter terms, and 130 years ago when American homesteaders worked the railroads and took in laundry and other ventures to support their farm, and 160 years ago when girls from Maine and New Hampshire were sent down to the woolen mills in Lowell, MA.  That is, while not true of every period in history, in the industrial age, it has generally been necessary to have an industrial income or two in order to support the subsistence farm.  Like Greer, I think we are in the process of a gradual transition to a post-industrial age, and I think because that is true, the industrial economy model of agriculture (as distinct from industrial agriculture itself) will probably not go gently into that good night.

But that doesn’t mean that most households won’t need to subsistence farm, in addition to the other things they do.  And the reason I’m focusing on this is because I think that thinking carefully and correctly about this issue will be essential as we prepare ourselves for the future - what we prepare for will shape how well we adapt.  Recognizing that home-scale food production, probably as a generalist, producing easily grown staples, vegetables and any animal products we require is part of our future, rather than (for most of us, I am generalizing and there will be markets for larger scale market gardeners - many of them) specialized niche production helps us plan for our future.

There are two reasons I think that most of us will be doing subsistence agriculture.  The first is that the future is one that I suspect will be more or less contiguous with the one we live in now - the ability of ordinary people to afford to meet basic needs will be steadily and seriously eroded.  Even at the level of simple functional necessity, all of us have a large number of basic needs that require large quantities of energy and money to fulfill at this point.  Property taxes may well be reduced by reassessment, but they won’t go away.  Many of us may be able to make some move towards not needing supplemental heat, but we’re still going to need some, and we won’t be getting all the energy locally.  Medicine is likely to remain costly even if we reduce to an absolute minimum our usage of most pharmaceuticals.  As we struggle to replace our energy and cost intensive educational infrastructure, many people will want to try and keep the internet going, if only so our kids can have some form of schooling not provided by parents working long hours.  And some money is going to be wanted for things like beer, cigarettes, cosmetics, escapist video games and books - the things that make difficult times marginally tolerable for many people.

Of all the basic needs that we currently fill with cash, the easiest and quickest one to replace may well be food.  Most of America is built in a way that makes use (note, not “good” use) of America’s huge size - we divide up land with a generous hand compared to Europe or much of Asia.  And we have spent the last 60 years subdividing our land into private lots, with moderately useful buildings still 20-50 years from their projected natural demise.  Now some of them may become derelict or be abandoned, some may be bulldozed and turned back to farmland - but this too is energy intensive.  While the selling off of our previous buildout may be a lucrative business, the rule about driving the car off the lot applies - there is a significant amount of depreciation involved, and while as Greer argues, junkyarding and scavenging will almost certainly expand vastly, it is also extremely likely that as the crisis creeps up on us, we may realize that much of what we have quite literally cannot be replaced, and find that it is necessary to make use of it.  But what we have created is mostly homes on fairly small lots by the standards of many farms - that is, large market gardening, of the sort that produces enough income to fully support a family, will be tough in many of the suburbs closest to cities - 1/8 acre lots probably aren’t big enough to bring in a lot of money - but they are big enough to reduce outgoing costs. Some people will specialize in high value crops, but for most people, growing your own tomatoes in a cash-poor society is probably worth more than growing at truckload of them and bringing them into a cash poor city - unless cities remain the province of the affluent.  Larger lot homes tend to be in the exurbs, and while 1-5 acre lots are perfect for market gardening, they have the problem of transport costs to contend with - and there are plenty of consumers in the inner suburbs happy to take their potatoes, without payint to ship them all the way into the city.  My suspicion is that most near-city gardeners will probably be subsistence gardeners. 

Trees take a long time to mature to firewood size, and it is tough to dig coal out of your backyard.  Home electric generation is pricey, and while some of us can grow our own medicinal herbs, we may still want tetanus shots and antibiotics at times. Few of us will be weaving our own cloth on any scale for a long time, if ever - while we may need to produce small items that wear out easily, industrial cloth production long preceeded fossil fuels. 

 Food, on the other hand, is pretty doable to produce.  And given that one of the hallmarks of an economic collapse or even Depression is widespread unemployment - while the growth, energy intensive economy wants as many employees as possible - it seems likely that with only minor familial reorganizations beyond what is forced upon us by the economy, the opportunity to produce food will be there.  As houses are foreclosed upon, I’m already seeing reports that squatters simply move back in - often the previous residents.  And if they don’t do that, well, they newly evicted go consolidate with their extended family, meaning that a household that once consisted of an overworked couple and their child may now consist of the same overworked couple, their child, their overworked brother and his boyfriend, and her mother.  The odds of everyone achieving - or needing - full employment are small.  And the subsistence economy means that steady employment of everyone is not desirable.

 The other reason that subsistence farming is a corrollary of a point I mentioned above - because food for export or perhaps biofuel production is likely to be so economically valuable in the coming years, much of the food we’ve relied upon in the past is likely to be quite expensive.  Artificial fertility is likely to be very costly - and a worldwide conversion to organic agriculture, while necessary, is likely to be staggered and messy in actuality and to come with costs of its own.  Climate change is unlikely to help worldwide total grain yields - the net seems to be an overarching decline.  Energy costs for fuel and other inputs are likely to continue to rise - and most of all, demand for grains and other foods is likely to remain high.  The large class of new American poor may well find itself unable to buy much food in a society where most food is marked for export.  And while I suspect the US government may continue subsidies to quell unrest, that doesn’t necessarily mean most people will be eating the food they want or are used to.  Meat and fresh fruits and vegetables during off seasons may be well outside most people’s means.

Which means powerful incentives to use existing land to produce one’s own - while currently home grown often means spending a lot, the techniques used by poor people around the world for home food production, plus the incentive of higher prices, mean that homegrown rabbits fed on weeds, chickens fed mostly on kitchen scraps and grass, with some grain fed on the side, and grass fed small grazers like sheep or browsers like small goats may well be cheaper to produce at home than to purchase.  Using free urine and composted marginal road wastes to produce food at home may well be cheaper than buying it at the store.

The combination of people having access to subdivided small parcels of land, under employment and high food costs means that subsistence food production will make sense in a way it has not in many years.  It has been a long time since Americans have fully understood that there is a distinction between “poor but we never felt poor” and “poor.”  But in the last Depression, and through much of history before that, and through much of the world at present, this is an enormously meaningful distinction - and the distinction is based primarily on the level of self-sufficiency of the people in question.  Those with access to land and food and shelter and heat tend to be of the “poor but we barely knew it” sort - those without access to those things tend to suffer the indignities and misery of being truly poor.  As more and more of us become poor, and are stripped of our formal economy incomes, the distinction between deep suffering and a little suffering will likely be one’s participation in the subsistence economy - not in ecovillages, but in the villages - and towns and cities and suburbs and what-have-you that we have now.

What do you think? Leave a comment below.

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