Radically Inept
Monday, August 09, 2004
  Economic Efficiency>Vulnerability>Revolution

I apoligize for the length of this screed, but it's something I wanted to get out. It probably needs a re-edit, and I'll try to get to it in the morning.

I will break this post into two general parts: How and Why. The first is how economic efficiency increases our vulnerability to acts of terrorism and revolution. The second part will deal with why I believe America faces a greater threat from internal forces of revolution, than anytime since the Great Depression.

The US economy has achieved extreme economic efficiencies in energy production and distribution; fuel production and distribution, healthcare, military logistical support, manufacturing and transportation among others. The result is increased vulnerability to intentional and unintentional disruptions that can successfully cripple our economy. In fact, the more efficient a system is, the more vulnerable it is to disruption.

A good example may be the M-16. It is a precisely milled weapon, with very close tolerances; tolerances so fine, that a little bit of dirt makes it inoperable.

Modern western economies, especially the US economy operate at efficiencies with the same tight tolerances, but also have the disadvantage that they are not just one system, but multiple, highly interdependent systems. A little 'dirt' in one system does not just prevent the operation of that system, but may well cause a domino effect across systems. Just-In-Time manufacturing and distribution is representative of these efficiencies.
JIT or Just-In-Time Manufacturing, What is it? by Inventory Solutions:
"JIT is not about automation. JIT eliminates waste by providing the environment to perfect and simplify the processes. JIT is a collection of techniques used to improve operations It can also be a new production system that is used to produce goods or services.

The American Production and Inventory Control Society (APICS) has the following definition of JIT:

'a philosophy of manufacturing based on planned elimination of all waste and continuous improvement of productivity. It encompasses the successful execution of all manufacturing activities required to produce a final product, from design engineering to delivery and including all stages of conversion from raw material onward. The primary elements include having only the required inventory when needed; to improve quality to zero defects; to reduce lead time by reducing setup times, queue lengths and lot sizes; to incrementally revise the operations themselves; and to accomplish these things at minimum cost.'

When the JIT principles are implemented successfully, significant competitive advantages are realized. JIT principles can be applied to all parts of an organization: order taking, purchasing, operations, distribution, sales, accounting, design, etc."
The JIT systems is in wide use in this country, and is highly efficient when it is in good order. But if a transportation problem arises anywhere in the system, for instance a prolonged winter storm, it can cause production to come to a complete halt at multiple manufacturing and production facilities.

Part of the problem, is that there is no redundancy; no fall back system. That would increase overhead, and defeat the design of the system.

Similarly, this system and others like it, are used throughout our economy. For instance, the number of healthcare facilities in large metropolitan and smaller cities, have through consolidation and cost cutting, been reduced to efficiently handling 'normal' loads. And there is no capacity to 'ramp up' in the case of an emergency. Here in Atlanta, the primary acute care facility operates consistently at 100% or above capacity. Should a natural disaster or other emergency occur, they will have to either turn away the disaster victims, or turn out their patients to make room.

Add to this, there is very little production capacity on-line to produce many needed vaccines. Well they are not needed now; they are only needed if something happens. Too bad if something happens though, it will probably take too long for the production lines to switch over; if any of the employees even remember how. There is some material stock piled, just hope we don't have multiple outbreaks and we'll be alright. Maybe the terrorists will be considerate and just bio attack one major city at a time, you know, be good sports. In that case we won't have a problem.

In the area of energy distribution, one has only to remember the 55 million who were without power last year due to a...actually, I think it must of been an act of god, because I never heard anyone take the blame or the liability. Worse, there has been virtually nothing done to improve that infrastructure. Certainly, no corporation will invest in redundant systems except under duress, and congress won't take a chance on taking a pay cut. Hence, the country is just a vulnerable to energy outages today, as it was a year ago, and no improvements are in sight. Oh, relatedly, remember that maintenance is overhead, which is why 20 million people lost power during a winter storm last year, though the companies had been told the maintenance was needed. It was not 'statistically' economically viable.

Energy production has not improved. True alternative energy systems, which would lessen our risks, are also not economically viable. Did I mention viable is a corporate PC word for profitable?

Oil refinery capacity is the lowest since...I don't know, but last I heard, we only have twelve refineries left, and many of those are geographically co-located. One natural disaster, and we all suffer.

Fuel distribution? Just recall what happened to Arizona and California when a pipeline burst in Texas (Amazing. I don't even have to stretch my memory for examples in any of these areas.). Redundant pipeline capacity is not economically viable, but disruption in service are, because the corporations make huge profits when they raise the prices.

All the systems above are also highly vulnerable to terrorist attacks, or even just cranky Americans, or just plain accidents.

In the popular drive to make our military more economically efficient (there has never been an economically effective military, it's a ridicules premise, the military is overhead), we have sole sourced the production and support of many of our weapons, communications, logistical, training and support capabilities. There is no fat. This is fine in normal peace time operations, but as we've seen recently, we now lack the capability to manufacture enough protective vests, armored HUMM-Vs, parts, etc in a timely fashion. And should the contractors decide a war is too dangerous (who's willing to insure the contractors?), and they don't show, the military no longer has the organizational ability to provide these services themselves. There are no cooks. And the high tech weapon systems are far too complicated for high school grads. Besides, the warranty on systems becomes null and void unless serviced by 'trained' (read serious billable hours) system technicians. Our military is lean, mean, and now lacks a true war fighting ability.

Oh, and in almost all cases, there is only one plant producing our weapons systems and platforms. Once they start running a third shift, you've maxed our production capabilities. For instance, there's only one plant in the country that makes tank tracks for the M-1. Hope it's enough.

Most cities have only one water treatment and waste treatment plant. Use your imagination.

Even our agricultural system has grown highly vulnerable in the name of economic efficiency. An intentional or unintentional outbreak in the meat packing plants (they are not many left), and you will stop beef. Let the new bird flu get just a little out of control in this country, and what do expect to happen? Perhaps a little ecoli in the fresh produce packing plants, what then? We don't have a distributed farm system anymore. Few of us live anywhere close to a local farmer. And if we do, how much food can he produce?

Oh, hell. I could go on, but I'm getting bored myself. So, just this final point. The economic ramifications of the failure of one system can in itself be huge, and consider how interrelated all of this is. If the power or fuel distribution systems go down, forget about production capacity. If bio attacks take out a plant's work force, JIT doesn't matter. The systems are all so interdependent, are economy is effectively one huge Achilles Heel. Just recall what the UPS strike cost the US economy.

Redundancy would go along way toward securing us, and it would be a great jobs creator right now. We could do it all in the name of nationally security (I hate the term 'homeland'. It reminds me of Fatherland and Motherland. Makes me think I live in a fascist state).

I won't go into how easy it would be for a terrorist to attack the individual systems, but I will now turn to why I think it's is growing much more probable for a revolution to occur in this country.

Actually I think it pretty obvious. It's because Jobs will continue to vanish.I think I explain it well enough there, but let me say this. Productivity increases due to ever increasing technology is the single largest cause. I guess we are still discussing economic efficiency in this regard. Each new technology builds the next one, and each step reduces the requirement for human labor. Think how many people it takes to manufacture a car today, compared to even 40 years ago. Start from the gathering of the raw resources and work your way up to the vehicle and the difference in numbers will amaze you.

And, if nanotechnology comes anywhere close to it's billing, who will need to work? Of course, who will make any money? Only those that own the nano-machines, and a few people to program them. But even if this does not come to pass, labor is still on the way out. And the computer power that is coming on line will reduce the need for the number of people employed on the thinking side of production. Middle management has already seen their hey day (I am waiting for us to outsource CEOs).

Add to all this, outsourcing for what cheap labor is needed, and I see a crisis on the way. All arguments that outsourcing is not a problem, are completely bogus. Consider a tall beaker of water connected to a large shallow pan through a pipette. Open the spigot on the pipette, and the water in the tall beaker will fall drastically, raising the pan of water only marginally. And that's what we have. The west is a tall beaker, and the rest of the world is a large flat pan. Our wages will drop drastically, and the rest of the world's will rise marginally. And discontent will rule on both sides. Americans will not willingly take the loss in wages, and the rest of the world will be extremely upset that theirs did not rise higher. Eventually, long after the balance is reached, it is possible that all will benefit in the long run. But it will be a very long run.

So, I foresee that soon we will have a very dissatisfied populace. Worse, it is a very ignorant populace, which has been proven to be easily misled and manipulated. Major media has failed on their end of the bargain, the one were they got FREE use of the PUBLIC's airwaves and in return, were supposed to return something back to the community. Instead, they have accelerated the dumbing down of America. I say accelerated, because the American public school system has failed in its duty also. The students turned out of high school today, are almost unable to think. This does make them easily manipulated, but they are also disillusioned and disaffected, especially the young generation.

It's no wonder really. With the exception of a few, a very few shows (Like Roseanne), this generation has been inundated with the message that they will not be happy, can not be truly happy, unless they own nice cars, live in huge spacious homes, have six figure incomes and plenty of leisure time. If they don't achieve these 'basics', they are failures. So we have in affect, produced a country of failures. This is a population that is ripe for a populist or two.

I'm not all suggesting a single revolutionary group. Rather, I expect to see enrollment of white supremacist groups grow. Various theocracy movements may take hold. Even various seperatist groups under whatever strange banner, will find easy pickings in a populace of ignorant, poor, dissatisfied people.

You say, "It can't happen? Not in America?"

Let someone take out the power grid, and do it in such a manner that it takes months to repair. The meat packing plants stop, the hog waste runs into the river, commerce comes to a halt, etc. Etc. Etc.

What happens in major cities when the canned goods run out? Who eats what? Or does it get to 'whom'?

People would become desperate for any hope. Anyone who can provide them some answers. And since they are by and large an ignorant population, the answers don't even have to make sense. Just tell the people that this or that group is responsible, and watch the mob go in that direction.

If it didn't have the potential to be so deadly and indiscriminant, one could take a certain schadenfreude when the owners of the mass media, government representatives, and corporate board members are lynched. But there in lies the problem. The targets of the population's rage will not be limited to the leaders who have failed us. It could easily turn racial, religious, regional or some other variant.

It could be prevented. It doesn't have to happen. But I do not see anyone, especially in leadership, giving serious consideration to the problems we face in the near future. We are going deeper and deeper into debt fighting a pointless war. One, which at best, will continue to suck the country's coffers dry, and send our capital out of the country while it puts our entire the social safety net at risk.

Corporations are not investing, and more importantly for us, they are not hiring. The new jobs that are being created to not pay a living wage. Educated people can not find work. Worse, our youth, even if they can get into college, have no idea what to study. Which area will be vibrant when they complete their four years of often expensive education?

Everyone seems to think that we will somehow just muddle through. And that is exactly what we did during the Great Depression. But at huge costs. And, we were at risk. Populists did rise up. The Marxist movement of the period swelled with new members. Others looked to fascism. The capitalist system was truly at risk. And we got lucky. A major war broke out. Maybe another major war will break out.

Maybe that is this administration's plan. Universal service, universal employment in the defense industries, and lots of dead Americans (lots of dead people, period) may be the cost they have decided we'll pay to get out of the coming economic problems. It sure seems like they want a world war. I just don't know if Americans want it, and if not, how will you get them to go. This group, this generation, is far more cynical than those of the past. I don't see my son volunteering. Hell, I don't see the Bush children or any of the children of our leaders volunteering. If that's the plan, I don't think it's good one.

I would hope that we could come up with a better idea, but I do not see anyone presenting one. I certainly don't hear anything like a plan from the two major parties, though we did hear some of the "non-electable" candidates at least bring up the issues.

But, as I said, Americans are a largely ignorant bunch. You can't pull them away from their entertainment and give them anything more than different entertainment. They may be feeling the pain, but they don't want to hear the prognosis. They certainly don't want to hear a cure that does not include them getting nice cars, huge spacious homes, six figure incomes and plenty of leisure time.

We've made sure they haven't paid attention to reality for a long time. In fact, we've hidden reality from them, in the form of 'reality tv' and the like. To once again paraphrase Nicholson in "A Few Good Men", 'They don't want the truth. They can't handle the truth'.

But eventually, we'll all have to face the truth. But we could make it alot easier if we'd face it now, and come up with a plan. 'Cause in spite of the pollyanna's running the show, the threat of a revolution is real, and becoming 'realer' with each passing day that we don't act to head it off.

Oh, and don't think our government can do much about it if it starts, we are vulnerable.
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