Today’s Contemplation: Collapse Cometh XCVIII
The following are two brief comments (followed by a couple of shorter responses to others) I put out on one of my town’s FB pages regarding the ongoing conversation/debate around a proposed 18-story apartment complex along our main street. This is a very controversial plan given the fact that buildings have been limited to 6 floors for decades and brings to the surface the insane speed with which development has been occurring in our once small town with the moniker ‘Country close to the city’ — which most laugh at now given the ongoing loss of ‘ruralness’ once felt/observed. This community on the edge of the Greater Toronto Area has grown from around 13,000 in 1995 (when my wife, newborn, and I moved to a spot overlooking a kettle lake 10 minutes north of the built-up centre) to close to 50,000 presently with plans to continue expanding at a 5–10% per annum clip for as long as possible. For anyone who has ever seen the television series Schitt’s Creek, several of the buildings seen in the show exist along our main street (e.g., the veterinary clinic) and the main buildings are located in the town of Goodwood ten minutes east of us.
Everybody keeps going on and on about how we need to increase significantly the supply of housing to keep prices affordable but this is not at the root of this issue. That rather facile explanation is the one being leveraged and marketed by the profiteers (especially developers and banks, and facilitated by politicians eager to look like they’re doing something ‘positive’) to expand their cash cow of ever-expanding ‘development’ — regardless of environmental impacts and finiteness of resources.
These unaffordable prices are primarily the result of gargantuan money creation (i.e., credit/debt) by financial institutions (banking and shadow banking) to support (at least for a bit longer) the Ponzi nature of our monetary/financial/economic systems.
Much of this newly created ‘money’ is sloshing around in the system looking for assets with the best returns and what better avenue than parking it in housing — much of which is being bought up by the rentier class (especially the ‘investment’ industry who suck up most of the supply).
Take a look some time at the enormous exponential increase in debt/credit instruments over the past few decades — all of which are potential claims on future resources (particularly energy) that have encountered significant diminishing returns.
This will not end well…
The ‘growth is inevitable’ narrative that some are repeating here must be challenged. Pursuing growth is a conscious choice and one being made and repeatedly propagated by those who stand to profit the most from it: the ruling caste of society who market it as purely beneficial and ignore or rationalise away the negative aspects. This creates an Overton Window that limits our thinking and thereby beliefs.
Limits to growth and the significant negative consequences of such growth (e.g., ecological overshoot) are real. While such repercussions can be ignored/denied/bargained with, the very real biophysical impacts continue on and compound regardless of our beliefs or wishes.
The speed with which growth overwhelms systems is not something to wave away via denial or bargaining through magical thinking (i.e., some as-yet-to-be-hatched technology will ‘solve’ our resource woes and toxic legacies). While growth can be perceived to have some good intentions, as the saying goes “The road to hell is paved with good intentions.”
We are putting at risk not just the overburdened planetary sinks that help to absorb and cleanse the pollutants created by our expanding industrial processes, but also the finite resource stocks — especially energy — that we depend upon for everything. Perhaps more importantly to sustaining a livable environment is the destruction of ecological systems in the wake of our growth. Biodiversity loss (mostly due to land system changes) over the past century or more has been off the charts and puts all species, including homo sapiens, in jeopardy.
And ‘building up’ to densify areas and prevent expansion onto farmland or environmentally-sensitive lands does absolutely nothing to eliminate the above issues. The sinks and stocks continue to be affected at almost the exact same rate. It is the continued growth that is the problem, not how we accommodate such growth.
For any that continue to believe growth in inevitable and can go on indefinitely (or, at least, for a lot longer before we must confront it), you need to watch the following presentation by the late Dr. Albert Bartlett, a physics professor from Colorado University, on the reality of exponential growth: https://www.youtube.com/watch?v=sI1C9DyIi_8.
You have fallen prey to the mythical narrative the governments, banks, and developers have created around supply and demand impacting house prices. This is not the primary reason. The fundament reason is all the credit/debt ‘money’ created by the financial institutions and government (mostly financial institutions). This newly created money seeks return and gets funnelled into popular assets, sometimes good ones but oftentimes not (think Non-fungible Tokens, cryptocurrency, or many stocks). Housing is one of the very popular targets for all this ‘money’, most of it in the hands of the ruling elite/caste that buy up the housing stock and then rent it out. When well-off individuals/families and/or investment firms (what some have referred to as the rentier class) have millions/billions of dollars at hand to soak up assets, they sink much in real estate and land thereby driving up the price of these assets. The developers, banks, and other profiteers, however, leverage the rising prices to argue for more of their cash cow: development. They need more land, hence opening up the Greenbelt. They need to build more houses, thus the push to build ‘millions’ of residences. Despite the building binge that has been going on for decades around Toronto, prices have shot through the roof. It’s not about supply and demand.
Disagree completely. Growth is happening to keep our Ponzi economic system going for as long as possible…a bit of a misguided strategy on a planet with finite resources, especially energy. We need to be pushing degrowth, not growth.
Shaving it off at zero would be best. The idea that ‘growth’ is inevitable is another of those notions that needs to be challenged. ‘Growth’ is a choice and one being made by our ‘leaders’ (mostly because the ruling caste profits immensely from it). It is neither inevitable nor beneficial past a particular tipping point when it begins to encounter diminishing returns — to say little about the negative impact any and all growth has on ecological systems.
While ‘printing’ money is a tad inaccurate (the vast majority of new money is loaned into existence by banks and shadow-banking institutions), the primary reason housing costs have ballooned is certainty related to this as you suggest: newly created money is flowing into certain hard assets such as housing. If one includes the derivatives nightmare and other debt-liabilities, the world is drowning in quadrillions of dollars of interesting-bearing obligations. The issue around housing costs is multifaceted and supply/demand is but a very small aspect…but one leveraged as THE one by those who stand to profit from ever-expanding development; mostly the banks and developers. I am reminded of what industrialist Henry Ford stated (paraphrasing US Congressman Charles Binderup):”It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
If you’ve made it to the end of this contemplation, I would like to offer you a PDF version of Book 1 of my ‘fictional’ collapse trilogy at no charge. You can email me at: firstname.lastname@example.org to request it; I just need your email — a paperback version is available online through my publisher and other book sites. If you have got something out of my writing, please consider ordering the trilogy (PDF files; only $9.99 Canadian) via my website the ‘profits’ of which help me to keep my internet presence alive…I am currently only 4 books short of Book 1 sales to reach my tongue-in-cheek goal of 423 copies sold (1 more than the 422 copies of John Cusack’s character’s — Curtis Jackson — book sales in the movie 2012). Encouraging others to read my work is also greatly appreciated.