The great North American weakness.

Twice in living memory has power been deprived to key sectors of North America.  The first time on November 9th 1965, and again on August 14 2003.  While occuring nearly 40 years apart, both had the effect of causing a complete blackout to the Northeastern portion of the United States and Canada, which is a hugely critical sector for the manufacturing and financial industries of the world.

During a blackout, regular communications systems and electricity don’t function.  Hospitals and police are reduced to emergency power, and even the telephone companies can only keep basic services going through a means of networked independent generators.  So, basically, a portion of the world is brough to a standstill.

In both cases, the incidents were caused by a relatively minor incident which resulted in a ‘cascading failure’ as the terminology is described.  Excess voltage was generated, which tripped the industrial equivalent of a breaker, and in turn, this safeguard went down the whole chain, resulting in dozens of states and provinces losing power.

Our power grid is surprisingly vulnerable, if such a minor incident can result in depriving a significant enough portion of the planet to be clearly seen form space to lose lights and power.  While the 2003 incident was a wake up call, and there have been additional safeguards put in place, the fact is that several communities did not receive power for weeks because once down, the system takes time to build back up to generating power.  Nuclear power stations don’t have an “on” switch, they have to be carefully monitored.

Niagara falls is a concern.  Although it is a wonderful natural resource, and it has been a key to our infrastructure for generations, it is highly vulnerable.  So much power is generated in one place that any disruption to its operations would affect a large number of people very quickly.  While is is doubtable that any terrrorist organization could or would attempt to target such a facility, the fact is breakdowns and human error are a factor of life.  With our modern world increasingly dependent on  energy, having so many eggs in one basket is unacceptable.

The idea of a terrorist attack on one of our nuclear reactors has been in the minds of defense planners for years.  Most nuclear facilities are guarded and hardened against such attacks, but, a more ingenious person might simply attempt to disrupt the power flow to a few at the same time.  A coordinated attack on 2 or 3 stations would probably duplicate the cascading failure and spread anarchy amongst the population.

Most frightening of all are the forces of nature.  Tornados are not a regular feature of the Niagara region, but, it is within the realm of possibility for one to appear.  While earthquakes are not endemic to the east coast coast, they do occur in very infrequent intervals.  While they are not as strong as their west coast counterparts, the building codes on the east coast are not meant to cope with anything strong, so an unexpected earthquake might be devastating to North America.

Beyond Mother Nature, there are cosmic level events that could disrupt our power.  The possibility of an EMP burst has been discussed extensively, and one in this region could prove catastrophic beyond belief.  Even worse would be a flare from the sun, which would be its own EMP burst, of staggering proportions.   The Carrington event of 1859 caused telegraphs to short out, and since the electrical infrastructure was so much less developed, ultimately caused less harm.  But, in our modern world, a Carrington style repeat would fry generators, destroy much data, and probably result in loss of life, along with huge losses of money.

The worst problem is, we don’t have a way to rebuild from such an event.  There are no spare transformers lying around in storage, and it would take months to manufacture them.  While Banks do keep backups of their records, insurance companies would take huge losses, and be under a significant strain just to accomodate the number of claims.  The emergency services responding to calls until the power got back online would be tasked to their limit.  Most importantly, be it manmade, natural, or cosmic, the right burst could cause a much bigger failure to occur, potentially even affecting a whole continent, or more.

Military equipment is hardened against EMP bursts, and I think we can all agree that the civilian infrastructure needs to be hardened to a similar degree.  Its good to have the air force flying to protect our borders in a national emergency, but, having the ability to service the population during a crisis is equally important.  With the trillions that have been invested in Quantitative Easing for the banks, the nations infrastructure could have been significantly upgraded with but a mere fraction of that money, with the side effect of creating jobs in construction, engineering, and encouraging students to study the STEM subjects in college and university.

Improving our infrastructure is a full out win for everyone.  Companies looking to relocate overseas frequently have to deal with power outages due to local generating limitations.  Think of the attractiveness of our economy if we could boast of a power system with guaranteed backups.  Also, the prosperity of the 50s and 60s were due to massive infrastructure projects of the 30s and 40s.  So, investing in improved energy infrastructure is nothing but an investment in the future prosperity of our nation.

Our politicians are scared to do this, because it will take longer than 4 years, and rare is the politician who can see beyond their current term.  But, just as important as the space race was in developing science and technology, now we must engage in an engineering race to safeguard our developments and make more.  We need to mandate, not incentivize projects that improve our infrastructure so that, as a culture, we can continue into the future.  We must be aware, and make our politicians aware that we do not want to treat these incidents as one off affairs.

Because there are plenty of people alive who remember both events, and plenty of others who remember 2003.  Do we want to be crying in 2045 when our much more interactive grid goes down, and no one remembers how to rebuild the power stations because the records were all on a hard drive that can no longer be read?  This is the time to  prepare for the future.  We hold our nations, and indeed, our species future in our hands.  Because a collapse of the North American stronghold would be like the Roman Empire collapsing.  Even if you were insulated from it, you still felt its effects.  Lets keep ourselves strong, lets keep  our infrastructure strong, and most importantly, lets identify risk factors, and take measures to prevent them.

Retail collapse

The future of brick and mortar looks bleak, and with it, comes a very new way to look at the economy. it is no secret that over the past year, Target has contracted, Sears has closed stores, and even Wal Mart has begun to claw back on their once rapid expansion, in contrast, the retail giant has even shuttered outlets. So, if department stores are on their last legs, what does the future present for the average consumer?
The first thing to look at will be what models are succeding in the modern business climate. Costco and Sam’s club, offering no frills retail service and savings on gigantic packages are succeeding and at a higher rate of profit than traditional department stores. Online services like Ebay and Amazon are succeeding with just in time delivery models and no overhead being spent on real estate.
Overhead for physical space has always been a significant expense for retail chains, and the modern trend is towards eliminating it. While this is perfectly understandable from a corporate perspective, it has drastic effects on the economy at large that have yet to be felt, but, are not unprecedented.
There was once a time where people could drop out of school at 16 and go to work for a factory. Unions and demand for labour kept their salaries relatively high, and most were able to save for items like houses and pensions that would add value to the economy. However, since this sector of unskilled labour has been reduced dramatically (perhaps the big 3 auto makers are the only extant significant examples) it has echoes elsewhere in the economy.
With the downward pressure on wages for unskilled workers, outsourcing has also come into fashion. It is well documented how it is possible to save a significant amount of money by having manufacturing take place overseas, but, the unseen costs to this are that not only are the unskilled and semi-skilled labourers eliminated, but, also their managers, the accountants and paymasters that look after their paycheques are in turn eliminated, and the products these people would have bought, like wide screen TV’s and ATV’s, are no longer in demand because this sector of the population can no longer afford it.
For a while, retail jobs were being filled with people who had come from the industries that had suffered job losses. Retail jobs were relatively plentiful, and while their pay was a dramatic step down, for a person willing to work hard, there were opportunities to get ahead, save up, work overtime, and get a promotion.
By eliminating physical retail space, the economy is ceasing to allow for the common person to be able to afford anything besides basics, and those will only be permitted by government assistance. The top of the economy, being the shareholders and CEO’s will profit immensely for the first while in their labour savings and costs being eliminated, but, in the long term, when there are no longer jobs readily available, there will no longer be products in demand.
Worsening this problem is the fact that online purchasing is difficult without a credit card. Yes, the online services do offer alternative methods like paypal and online debit card, but, the most common method to purchase online is by credit card. For that vast majority of people who do not have credit, or who are struggling from day to day, there is no possibility for them to access online goods and services.
So, by eliminating retail space, and cutting wages, the major corporations have created a giant vaccum in the economy. While currently that vaccum is being filled with cheap money because of the Quantitative Easing programs, it is unlikely that system can be maintained indefinitely. Since our society has lost the custom of growing kitchen gardens, or bartering goods for services, and moreover has no means to do this effectively without government oversight, small businesses are strangled out of existence, meaning that only underground businesses will survive.
Unfortunately the underground economy almost necessitates criminal involvement, as they know how to navigate the underworld better than does the average citizen, and are far more willing to barter goods and services than are the massive oligopalies that exist at present. So, with corporations self serving interest, they are not only depriving themselves of a future market, but, they are also assuring that criminal enterprises like the mafia and gangs are positioned to profit off of the future economy.
Where big business fails, the undercurrent of the underground economy will step in to fill the void. GIven the model of the collapse of the Soviet union, without an iron clad clampdown on the underground economy (which is difficult even in an environment as controlled as they had) the gangs and mafia will emerge to take control once the corporate oligopalies have ruined the economy for the average person.
So, if the present tendencies hold, and no innovation is brought forward to revolutionize our economy, the future looks bleak. Those who don’t possess a ‘Roof’ (Russian Mafia slang for affiliation or protection money) wlll be left in the wilderness, too poor to afford to buy from the oligopalies, and without the connections to buy from the underground. If we seek to avoid this future, we need to buld an economy worthy of the name, and not waste time speculating on the stocks of whatever corporation is rising today.
This is a warning, but, one that may turn prophetic soon enough. We are dangerously close to this reality, and the contraction of the retail industry will not be the sole factor that destroys the economy, but, it will cause a massive implosion that probably cannot be countered, no matter how much money is loaned to the banks for speculation.
The retail collapse has begun. The implosion of the economy is not far behind because of the lack of jobs on a domestic front that have not been outsourced or had their wages lowered ridiculously in comparison to inflation. Either way, the invisible hand of economics has proven that it only exists to snatch things towards the rich, and does not in any way regulate itself. We must fortify ourselves and concentrate on rebuilding our society, from the ground up, or else face a society straddling multiple layers of economic activity, at various levels of legality. This eventuality will suit no one well.
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