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A Quick Economic History of the World from a Prepper’s Perspective

 

The concept and the practice of prepping dates back as far as does recorded history.  It was common for ancient civilizations to set aside food for the future, and it was common for small communities to be self-contained and not reliant on the outside world for their survival.

It is really only during the 20th century that prepping has diminished.  Interestingly, the same factors that saw a reduced need (or at least a reduced perception of need) to prepare for the future are now in many cases bringing about increased vulnerabilities and a growing need to plan and prepare for unknown futures.

Perhaps the most revolutionizing two factors in our society have been energy and information.  Most all else derives from either or both of these two sources.

Energy Brings Civilization and Freedom

In terms of energy, the development of controlled energy sources allowed us to first develop steam trains and then subsequently, even smaller energy generators allowed the creation of private motor cars.  An extraordinary freedom followed – for the first time, man was no longer limited by the endurance of horses for the distance he could travel.

And that’s not all.  Not only could people travel greater and greater distances in shorter and shorter times, but this new-found freedom extended not just to people, but to freight as well.

Harnessing energy also made possible a transformation from cottage industries to mass production in factories, and the transportation networks allowed for effective distribution over wider areas of products made in large quantities at a single location.  Economy of scale followed.

Energy impacted on our home lives as well.  Electric power lines brought this same transforming energy into our homes.  We no longer had to locate our homes in a sustainable place – we could rely on importing the energy we needed to transform almost any place, anywhere, into a comfortable living environment.

This set in place an amazing transformation – we no longer needed to live close to where our food was grown, and we no longer needed to participate as much in the preparation of our food.  Instead, we began to increasingly rely on other people to do this for us.

Our article on the worrying trend of urban drift shows that at the beginning of the 20th century, six out of every seven people still lived in rural settings, close to their food.  Each city-dweller had six rural dwellers available to support him.

But by the beginning of the 21st century, that number had almost exactly reversed. It seems that today for every one rural dweller, there are five city dwellers.

That makes the five city dwellers massively more vulnerable to disruptions in the supply of food from the rural areas to their supermarkets, and has disconnected the vast majority of the population from any understanding of food supply.  Food is stuff that appears as if by magic in the local supermarket.

In as few as 50 years, give or take, much of western society was transformed from regional micro-economies only loosely tied together by minimal trade between each village, and became regional then national in nature, and then in the next 50 or so years after that (most notably after World War 2), our economies and societies took a further quantum step forward and became internationally based.

Information and Communication Further Separate People from their Food Sources

The ability to trade over long distances was not just a function of energy and its derivatives.  It was also a function of information and its derivatives too.

The ability to send communications was once limited by the carrier of the communication – the messenger person.  Limited attempts to transcend these distance and time limitations were tried and worked with varying degrees of unreliable success – signalling beacons, smoke signals, semaphore, and such like.

It was the coming of the telegraph (something that was also made possible by energy – electricity) that created a revolution in communications and information transfer and sharing that outstripped even the revolution in transportation.  Whereas it still took days or weeks for a person or a thing to travel hundreds or thousands of miles, limited amounts of information (sent, character by character, in Morse code) could now travel nearly instantly over great distances.

Reliable and instantaneous communication was the glue that created the bonds of distant trading.  It was possible to now communicate orders for products, and to reply with details of shipments, delivery times, and so on.  Soon it became possible to transfer money by ‘wire’ as well, making long distance commerce even easier and more practical.

Okay, so you get the idea.  Much/most/all of this you probably already know, even if you’ve not looked at it from a prepping perspective.

Specialization Brings Vulnerabilities

Let’s now look at the flip side of this amazing progress.  The good news was that lifestyles massively improved due to more efficient distribution of labor and resources.  The rarely considered flipside of this was that each village – formerly independent and reliant on nothing/no-one/nowhere else, was not becoming increasingly reliant on other villages/towns/cities/regions/countries for some or much of its essential products.

If a village concentrated on growing wheat, it would trade with another village that was primarily focused on raising farm animals for meat, and with another village for building materials, and so on.

At first, such trade was marked by three distinctive characteristics.  It was slow and somewhat unreliable, so everyone at every step of the way kept large quantities of goods in their respective inventories.  A disruption in supply could occur for an extended period with the only result being a reduction in held inventories; no-one would run out of the product.

Secondly, the products being traded were reasonably ‘low tech’.  The suppliers of the products could add extra production capacity in fairly short order – typically a single growing season for food, less than a year for manufactured goods.  Peaks and troughs in supply and demand were gracefully handled.

A related part of this was that a village that was relying on another village for something could, in a reasonable stretch of time, probably develop the capability to create the needed product or material itself if things went wrong.

Thirdly, the economy was still largely fractured.  For example, unlike today, there weren’t just two passenger airplane manufacturers in the entire world.  There were dozens of them.  And each of these manufacturers in turn had dozens of companies supplying them with raw materials.  Same with cars or just about anything else you care to consider.

Redundancy

The supply system had massive redundancy built-in.  Any company at any point in the manufacturing (or distributing) process could fail and it would only represent a small portion of the total available capacity.  Furthermore, remembering point two, the remaining companies could quickly ramp up their capacity to cover the lost capacity represented by the failed company.  And furthermore again, remembering point one, the supply chain was well filled with months of product – months worth of raw materials, months worth of partially assembled products, and months worth of finished goods, held in the factories, in distributor and wholesaler warehouses, in transit, and in retailer stores too.

It was the same for food as it was for manufactured goods.  While there were some regional specializations based on weather and soil type issues, food was grown in multiple locations and the companies sourcing and selling it had many different places to turn to when placing orders.  The ultimate producers of food tended to be in the form of many smaller farms and ranches rather than a small number of mega-producers.

Greater ‘Efficiency’ Reduces Redundancy and Safety

Well, sooner or later, Harvard and other business schools started minting MBA graduates, and these MBA graduates looked at the world around them exclusively from a business/profit perspective.

From that perspective, it made no sense to have a dozen different car manufacturers.  It made sense to have one or two mega-sized companies; besides which, if the big companies bought out or eliminated the smaller companies, they’d not have so much competition, either.

Increased centralization on the one hand, increased economy of scale, and also increased globalization all lead to less manufacturing in the US itself.

Our article about how the global production of automobiles is now being threatened by a fire in one company in a small town in Germany shows how the one time rich fabric of many suppliers, in many locations, has now been replaced with only a very few key suppliers underpinning an entire gigantic industry, all across the world.

Summary

The benefits of industrialization, of energy availability, and of information and communications  are real and enormous.  We now take for granted things that 50 years ago would have been considered totally impossible.

Who would have thought, 50 years ago, that we could all watch movies in our homes, any time we liked?  The fanciful gadgets shown in comic strips such as Dick Tracy are now normal parts of our everyday life, with our smart phones being vastly more functional than Dick Tracy’s fancy watch communicator was.

And so on and so on, through any number of examples.  Preppers, as much as anyone else, love the modern world.  It is great.  We hope it lasts forever, and continues to get even better.

But – and here’s the thing.  Our modern world is increasingly supported by more and more artificiality.  If something should interfere with all the wonderful things that fill our lives, what happens then?

Please now return to the main An Introduction to Prepping page to read on to the next part in this series.

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