I’m a big fan of John Robb, but I must admit I initially thought he was way to pessimistic.

Indeed, faced with the 2008 meltdown, John predicted a rapid rise of hollow states, who retain the form, but can no longer function as we expect states to do. As I witness the self-destruction of the Thai state, who refuses a social compromise and free elections to the majority of its working and rural population, even as it is still in a growth phase, and as I witness the attacks of extreme neoliberalism on what remains of the European welfare state (I’ve just been in Italy, where there is endemic precarity, and which seems behind Thailand in many infrastructural respects and is in the hands of a predatory faction of capital), I’m now increasingly convinced that he was right, and I too optimistic.

If you recall earlier articles, I posted two main scenarios. A scenario of deep meltdown and final crisis, leading to resilient local communities, but also another ‘high road’ scenario with a substantial chance for a combination of enlightened policy (by Obama, indeed, how naive I was to compare him to Roosevelt instead of the Herbert Hoover he turned out to be), popular mobilization, and the interconnecting of new open infrastructures.

What seems to be happening is that mobilization is increasingly happening indeed, and also the quite rapid spread of open and sharing infrastructures, BUT, there is no longer anyone to talk to. The enlightened part of the nation states either do not exist or are two weak, and the global market forces are intent to break what remains of their independence, and hence, what they can do and signify for their own people’s. They’re is simply nobody there anymore, the system has exhausted its capabilities to rectify outside of the narrow interests of the predatory financial class.

Hear what Niall Ferguson has to say on the subject, giving a historical context to sovereign defaults and how it has destroyed empires in the past, in very rapid ways.

1. The end of the high road to P2P

So, without further ado, here is what John Robb is writing on the matter:

(this is no call for despair mind you, it means more urgency to the building of the successor civilisation!!)

“Most analysts (at least the ones that are worth reading) contend that the sovereign default crisis (Greece, Portugal, Spain, etc.) in the EU is about the collapse of a system that created monetary union without a political union. It isn’t. That’s actually a narrow, parochial view. Instead, the current sovereign debt crisis is about something much more interesting: it’s another battle in a war for dominance between “our” integrated, impersonal global economic system and traditional nation-states. At issue is whether a nation-state serves the interests of the governed or it serves the interests of a global economic system.

Who’s winning? The global economic system, of course. The 2008 financial crisis, the first real battle of this war (as opposed to the early losses in skirmishes in Russia, Argentina, the Balkans, etc.), generated a very decisive outcome. It was a resounding defeat for nation-states.* The current crisis in the EU will almost certainly end with the same results.

When this war ends, and it won’t be long, the global economic and financial system will be the victor. Once that occurs, the nation-states of the West will join those of the global south as hollow states: mere shells of states that serve only to enforce the interests of the global economic system. These new states, more market-states than nation-states, will offer citizens a mere vestige of the public goods they offered historically. Incomes will fall to developing world levels (made easy to due highly portable productivity), and wealth will stratify. Regulatory protections will be weak. Civil service pensions will be erased and corruption will reign. The once dominant militaries of the West will be reduced to a small fraction of their current size, and their focus will be on the maintenance of internal control rather than on external threats. The clear and unambiguous message to every citizen of the West will be:

You are on your own. You are in direct competition with everyone else in the world, and your success or failure is something you alone control.

For those that think that this will bring about a surge of peaceful economic vigor, you will be wrong. It will fragment society and lead to perpetual stagnation/depression, endemic violence/corruption, and squalor. For absent any moral basis (a social compact), stability, or (widely shared) prosperity: new sources of order will emerge to fill the gap left by the hollowing out of the nation-state. These new sources of order will be first seen in the rise of the criminal entrepreneur, whether they be the besuited corporate gangster or the gang tattooed thug. For in the world of hollow states (without a morality that limits behavior) and limitless connectivity to the global economic system, these criminal entrepreneurs quickly become dominant, violently coercing or corrupting everyone in the path to their enrichment.”

2. The low road to p2p: the local resilience strategy

Under the conditions described in section two, what is left to do is to create an infrastructure that is increasingly decoupled from the global shocks, through what John Robb calls SCALE INVARIANCE.

John Robb:

“Scale invariance is a requirement for societal resilience. It is also something anyone seriously thinking about the topic of resilience must be familiar with. Here’s why. Our global system is composed of intermeshed and tightly coupled networks. These interlinked networks enable our system to be efficient and relatively robust against random shocks. However, large shocks can overwhelm this type of network design, causing it to either act erratically (turbulence) or break apart (into smaller clusters via cascades of failure). We saw systemic turbulence in action via the recent brush with a global financial meltdown in September 2008 and we are seeing it currently with erratic swings in markets, trade, and other forms of economic activity. Examples of network failures that result in disconnected clusters are seen with every black-out in the electricity network. A pandemic would be a mix of the two, intentional clustering (quarantines) and high turbulence.

In either case, system recovery could be catalyzed and the damage largely mitigated, if our global system was scale invariant. Basically, this means that if we had communities that could produce at the local level many of the essential products and services currently produced at the global level, handling disconnection or buffering turbulence would be of little consequence (also, it would be much easier for us to find ways of protecting or making redundant the products/services that ONLY could be produced at the global level). Fortunately, particularly given the substantial uptick in dynamic instability at the global level, we are seeing movement towards scale invariant resilient communities. These communities can and would be able to operate autonomously regardless of availability, pricing, or quality of external goods/services for extended periods of time. Unfortunately, this movement may not spread quickly enough to provide any meaningful support to those communities that are utterly dependent on the smooth functioning of the global system.”