In Closing the Collapse Gap, Dmitry Orlov argues that the USSR was better prepared for collapse than the US — and he expects the US to collapse soon. This is also the theme of his new book, Reinventing Collapse: The Soviet Example and American Prospects.
While I don’t think a US collapse is unthinkable, and I do think such a scenario is a fascinating thought experiment, I can’t place my faith in someone who sees obvious parallels between the US and USSR because they both were military and industrial superpowers, both tried to spread their ideologies around the world, both competed in the space race, etc.
Orlov saw what happened when Russia collapsed — when he visited family; he no longer lived there — and expects to see the same in the US:
We should certainly expect shortages of fuel, food, medicine, and countless consumer items, outages of electricity, gas, and water, breakdowns in transportation systems and other infrastructure, hyperinflation, widespread shutdowns and mass layoffs, along with a lot of despair, confusion, violence, and lawlessness. We definitely should not expect any grand rescue plans, innovative technology programs, or miracles of social cohesion.
Even before its collapse, the USSR was prone to shortages. The US is more likely to face high prices, without shortages — at least until the politicians institute price controls.
The collapse of the government left the Soviet command economy without direction:
When faced with such developments, some people are quick to realize what it is they have to do to survive, and start doing these things, generally without anyone’s permission. A sort of economy emerges, completely informal, and often semi-criminal. It revolves around liquidating, and recycling, the remains of the old economy. It is based on direct access to resources, and the threat of force, rather than ownership or legal authority. People who have a problem with this way of doing things, quickly find themselves out of the game.
I have little doubt that Americans would skirt the law to make a buck, but I’m not sure it would play out the same as in the USSR, where everyone tried to sell off state property for their own gain.
Two of the “strengths” of the Russian system were its lack of home ownership and lack of private cars:
In the Soviet Union, all housing belonged to the government, which made it available directly to the people. Since all housing was also built by the government, it was only built in places that the government could service using public transportation. After the collapse, almost everyone managed to keep their place.In the United States, very few people own their place of residence free and clear, and even they need an income to pay real estate taxes. People without an income face homelessness. When the economy collapses, very few people will continue to have an income, so homelessness will become rampant. Add to that the car-dependent nature of most suburbs, and what you will get is mass migrations of homeless people toward city centers.
When you build a system that doesn’t take advantage of cheap oil, naturally you survive an oil shock much better.
Orlov also sees lumbering Soviet bureaucracy as a “strength”:
Economic collapse affects public sector employment almost as much as private sector employment, eventually. Because government bureaucracies tend to be slow to act, they collapse more slowly. Also, because state-owned enterprises tend to be inefficient, and stockpile inventory, there is plenty of it left over, for the employees to take home, and use in barter. Most Soviet employment was in the public sector, and this gave people some time to think of what to do next.Private enterprises tend to be much more efficient at many things. Such laying off their people, shutting their doors, and liquidating their assets. Since most employment in the United States is in the private sector, we should expect the transition to permanent unemployment to be quite abrupt for most people.
I don’t think he appreciates the upside of creative destruction. Shutting doors and liquidating assets means reallocating resources to where they’re more useful.
Anyway, you can see that a society that expected regular failure was better prepared for large-scale failure.
So what does Orlov recommend? Well, he assumes that no political party could get into power on a platform of preparing for collapse — a good bet — but recommends that a hypothetical Collapse Party take care of some things that the Soviets did not take care of:
I am particularly concerned about all the radioactive and toxic installations, stockpiles, and dumps. Future generations are unlikely to able to control them, especially if global warming puts them underwater. There is enough of this muck sitting around to kill off most of us. I am also worried about soldiers getting stranded overseas – abandoning one’s soldiers is among the most shameful things a country can do. Overseas military bases should be dismantled, and the troops repatriated. I’d like to see the huge prison population whittled away in a controlled manner, ahead of time, instead of in a chaotic general amnesty. Lastly, I think that this farce with debts that will never be repaid, has gone on long enough. Wiping the slate clean will give society time to readjust. So, you see, I am not asking for any miracles. Although, if any of these things do get done, I would consider it a miracle.
I’m inclined to worry about the opposite nuclear problem: I’d make sure that nuclear power plants had enough fuel on-site to continue operations.
Orlov is also a nihilist on a personal level:
Certain types of mainstream economic behavior are not prudent on a personal level, and are also counterproductive to bridging the Collapse Gap. Any behavior that might result in continued economic growth and prosperity is counterproductive: the higher you jump, the harder you land. It is traumatic to go from having a big retirement fund to having no retirement fund because of a market crash. It is also traumatic to go from a high income to little or no income. If, on top of that, you have kept yourself incredibly busy, and suddenly have nothing to do, then you will really be in rough shape.