—by Odysseus
Dispersion: Smaller is Better and More Resilient
Last week, Sandy Weill, the originator of the mega-bank model, opined that he had been wrong about that concept and that the big banks should be broken up. In the late 1990s, he had lobbied to kill the Glass-Steagall Act, the Depression-era law which had set up walls between risk-taking investment banking functions and traditional banking businesses, like small business loans and customer deposits. The repeal of Glass-Steagall was one of the several factors that made possible the bank collapse of 2008 and the subsequent wealth-hemorrhaging, liberty-destroying bailout. While there were other causes, the collapse would not have been possible without the repeal of Glass-Steagall. This writer’s analysis of the panoply of causes of the 2008 banking collapse are to be the subject of another post.
In the aftermath of the collapse and the subsequent scramble, “Too Big To Fail” became the shibboleth of our time. Massive private institutions positioned themselves to utilize government to extort tax dollars from every citizen, socializing their failures while privatizing their profits. It was valuable to our discourse that the pioneer of this misbegotten concept has lived long enough and gained the perspective to see its error and to share with us that lesson learned about banking.
There may be a greater lesson to be drawn that can be generalized to a wide number of social science disciplines. Perhaps “dispersion” is a long-ignored, beneficial phenomenon common to many successful social models throughout history. If so, it would be a rational conclusion from which we could draw an analogy to biology.
Diversity and redundancy have been successful traits for biological entities and ecological systems. Likewise, as organisms lose redundancy and diversity, these organisms and systems become less resilient, and are more likely to perish in the face of even small challenges to their system or environment. Although less “efficient”, a dispersed system is more resilient. Once again, the biological example is instructive. Bilateral symmetry may not be the most efficient method. However, the redundancy makes it the most survivable. A creature with one large lung, one kidney, one brain lobe, one arm, and one testicle or ovary may be more “efficient” in terms of energy consumption, but such a creature is far less survivable. One can only imagine how much more resilient humans would be with two hearts.
When one notes the biological analogy, one can see that this principle applies to many different social organization disciplines. To further explain the efficacy and possible results of the implementation of “dispersion” as a guiding principle, we can apply it to several realms of a human society’s endeavors, in addition to the previously-mentioned banking sector.
Banking and Economics:
Many economists have long pointed out the benefits of “economies of scale”, and these were the benefits touted in allowing the growth of mega-banks, big-box stores, and the reconstitution of several oil monopolies during the 1990s. Certainly, the WalMarts of the world have a competitive edge against smaller organizations, utilizing their greater buying power and market saturation to achieve favorable trade for themselves. However, what has been ignored is the vulnerability created by these monolithic, mono-culture systems. It is related to the peril of “monopoly” as described by Adam Smith and the classical economists.
Utilities:
This author first noted the pattern when analyzing the difficulties confronting the United States military in the first stages of the occupation of Iraq, after the cessation of primary hostilities. The allied forces were no longer fighting organized military formations, but, rather, dispersed guerilla actors, while trying to restore order and society. These guerilla forces were impeding progress by attacking the power stations and transmission lines. In the analysis of possible solutions to the problem of protecting energy infrastructure from insurgency attacks, it was noted that traditional, centralized utilities, while certainly the most efficient means of producing and transporting essential utilities like water, power, and telephone, they were highly vulnerable to actions of intentional or environmental chaos.
The key to the puzzle lies in the telephone sector. The former “telephone” (as descended from telegraphy) was long highly vulnerable to “having the lines cut”. However, we have seen the “telephone” transformed into the “telecommunication” sector. Throughout the less-developed world, cell phones have proliferated in the past ten years, providing communications in a way that traditional telephone lines had not been able to do in over a hundred years of technological existence. This begs the question as to why the relative success and failure, which point to an inescapable conclusion. Resilience resting on dispersion is the principle behind the success. The less-developed world has far more chaotic societies, little governmental legitimacy, and diminished law enforcement capabilities. This is compounded by reduced capability to deal with natural disasters. Therefore, telephone (telegraph) poles, lines, and centers could be disabled by vandals, political groups or even winds, floods, earthquakes or pests. Disruption of service to large numbers of citizens could be accomplished with little effort. However, the model of cellular service is essentially one of dispersion based resilience. There are many cell phone towers, each more or less independent and free-standing. The phones themselves are not tied to a specific line, or tower, but, rather, seek out the “best” signal available within their range. If a natural act or vandal attacks and destroys a single tower, or even several towers simultaneously, service is not completely stopped. Like a natural organism, the communications systems simply adjusts to using the towers that are still functioning, enabling the organism (telecommunications) to hobble along until it can return to health (be repaired).
Once this concept was realized it became possible to attempt to apply it to the other essential utilities, to see if such a resilience was possible. While it may be more efficient to have large coal-fired, nuclear or hydroelectric power generation plants, each of these plants and the transmission lines are highly vulnerable. Either destruction or takeover of the facilities permit a small force to disrupt a much larger segment of society. If the power generation or some portion of it were dispersed to the houses of individual citizens, the overall grid would attain much greater survivability. There would be effects on the “human terrain” as well. An individual Iraqi might cheer the spunky Mujahadin who blows up the power station in resistance to the oppressor, conveniently ignoring that he will be among the people without electricity that night. However, if the same “freedom fighter” climbs into his Iraqi neighbor’s back yard and starts smashing his solar panels or cutting down his wind turbine, the Iraqi is likely to either call the coalition forces or shoot the “terrorist” himself. (This is the principle of an “ownership society” as applied in the Middle East). Thus, in addition to power generation on a dispersed grid being a much more difficult, resilient physical target, in some situations, it harnesses the psychological efforts of even a resistant population towards its maintenance. In a hostile or unpredictable environment, electrical generation could be dispersed out to the population to small individual systems, each contributing a portion to the overall grid and, thereby, increasing resilience and reducing strategic vulnerability. The same principle could be applied to all other vital utilities. Individual water wells are less vulnerable than central water processing plants, which could be sabotaged, poisoned or captured. Septic tanks are less vulnerable than central sewage processing plants and so forth. Even petroleum supplies are subject to this analysis. The centralization of our petrochemical industry makes our nation’s mobility subject to control of our sources of oil from the outside. Additionally, it creates vulnerability in the infrastructure, susceptible to capture or sabotage. A nation that uses military-style flex-fuel vehicles can, in times of crisis, run them on bio-diesel or ethanol fuels that can be manufactured on smaller, local scales. Though more expensive per energy unit, they could maintain mobility and greatly disperse the available sources of energy. Our societal “organism” would then have a wider variety of “foodstuffs” upon which it could survive, if not thrive.
Military:
During early phases of World War II, Japanese Admiral Yamamoto was asked about the feasibility of invading the west coast of the United States. Noting the Second Amendment to the United States Constitution and the wide prevalence of privately-held firearms, he observed that an invading army would face “…a rifle behind every blade of grass”. The Founders envisioned and implemented a “dispersion” system of military power, analogous to the above-outlined “dispersion” of electrical power. The Founding Fathers did not add the Second aAmendment to the United States Constitution solely to protect hunters, permit self defense against criminals or even to assist citizens in overthrowing a corrupt, tyrannical domestic regime. They were fully aware of and predicted Yamamoto’s dilemma. In that their initial forces were a militia, drawn from the citizenry and armed with their own weapons, the Founders fully understood how daunting it is to an invading army to attempt control of a fully-armed citizenry. A tyranny ruling over a disarmed, subservient populace is much easier to overthrow because only the official organs of state security must be defeated or convinced to change sides. Even European democracies, which chose greater centralization of power through tight regulation of firearms, became more vulnerable to foreign invasion. The invaders made use of their victims’ own regulations and registration to disarm the populace in order to establish their own control. The invading Nazis did just this in France, Czechoslovakia, Norway, and the Netherlands. The popular resistance to the Nazis flourished only in more anarchic countries with a tradition of private weapons ownership, like the Balkans and Greece.
The existing United States military structure realizes, at least in part, the value of “dispersion” as a vital part of a force’s resilience. Military bases are dispersed to make for more difficult first strike targeting. Hardware assets are dispersed geographically to prevent full destruction or capture by opposing forces. Likewise, the officer corps is fully set up for redundancy, utilizing a fully-dispersed “chain of command” so that the loss of any officer or even set of officers does not paralyze a unit into immobility.
A wiser use of our limited military resources should include our Founders’ concept and their plans for dispersion of force throughout the populace, as feared by Yamamoto. The Swiss model of providing all the adult males with official military equipment need not be implemented since so many of our citizens already arm themselves. However, wrapping this convenient fact into our defense strategies could reduce our overall need for expenditure, while conserving a viable defensive strategy. If all adult males were required or strongly incentivized to participate and maintain membership in militia battalions, taught basic infantry tactics, and assigned to local officers for chain of command purposes, this decentralization of knowledge, skill, and resources would greatly enhance the United States’ national security. This would help defend against both conventional attack, as imagined by Yamamoto, but also against “swarming” style terror attacks. A society filled with trained infantrymen would have the first aid medical skills to triage casualties on the scene and would also make it more likely to be able to disable the small number of terrorists acting in any one location. It would reduce the impact of even the “crazed mass killer” phenomenon that pops up randomly far more than any proposed “gun control” legislation. The population itself would be able to organically respond to any attack instantly, at any location, much as a complex organism mobilizes all the local individual cells to compensate against injury.
Food Production:
It could be argued that the older, semi-agrarian style of society, more widely used in America at the time of the Great Depression, lent more resilience to the society. When the population at large had at least some small capacity to generate its own foodstuffs by having a small garden, chickens, a goat or milk cow, the likelihood of malnutrition or starvation was diminished even during a severe social disruption of resource production and distribution.
Housing:
The American-style individual family home is a basis for a much less efficient, but far more resilient shelter solution for humans. Whereas apartment buildings can centralize power usage, they also increase the risk from any hazard. Fire becomes a threat not to one family, but to hundreds. Quarantine of disease requires the writing off of hundreds of possibly healthy individuals, condemning them to death, as opposed to marking off a single residence. In terms of intentional hostile action, it serves zero strategic benefit to either drivers of car-bombs or to those who launch sporadic, long-range conventional, missile attacks to strike a single home and killing the family therein. Densely-packed urban apartment dwellers, however, are a viable target. One need only look at the carnage of American servicemen at the Khobar Towers in Saudi Arabia to see this inescapable mathematic.
Transportation:
The transportation system of the United States, utilizing primarily individual automobiles, is often criticized for lack of efficiency when compared to European mass transit systems. However, what is overlooked is the resiliency the United States’ system enjoys by comparison. Buses, trains, and streetcars are all highly vulnerable to attacks, generating mass casualties in a single strike. Such attacks can not only cause mass casualties on difficult to defend “soft” targets, they also disrupt an entire city’s transportation for extended durations, causing untold economic loss. A single Irish Revolutionary Army bomb or even the threat of such would shut down the entire underground train system in London for hours and paralyze the city. Transport by individual automobile provides no such target-rich environment for a would-be terrorist. Even a large explosion would only injure few people and disrupt a single roadway that would be easily bypassed utilizing detours through surrounding streets. Though less “efficient”, the United States’ transportation system is far more versatile and resilient. Even systemic problems, such as fuel or parts shortages, can be more easily “worked around” by the population without need of government assistance. Citizens can pool resources spontaneously on their own initiative whereas centralized transportation systems cannot.
Conclusions and Implications:
It would certainly make a much more resilient society to begin consciously implementing principles for the dispersion and decentralization of the essential elements of societal survival. Such efforts would help to protect against any adverse attack on society’s continuity, whether it was intentional hostile activity, invasion, or even natural “zoo events, such as volcanic eruption or even extra-planetary impact. Another benefit would be the increase in the strength of individual liberty. There have been many writers and philosophers who have studied the beneficial effect that the enhancement of individual liberty seems to have on a society’s economy and its resistance to stresses. However, it could be that what has been traditionally seen as “liberty” is its equivalency to “dispersion of resources and decision-making ability”.
There may be resistance to a dispersion of critical resource control by the existing power elites. The power elites will struggle to maintain the industrial age infrastructure that has served as their power base and means of control. If we ran vehicles primarily on ethanol, ethanol can be relatively easily produced by small groups of people with little capital. Likewise, the new solar power cells that are like roof shingles would disperse the generation of electrical power to single family homes or office buildings, thus, reducing the ability of government-licensed monopolies to sell something as necessary as “air”.
Dispersion and decentralization reduce the likelihood that a small number of individuals can use vital resources as a means of social control. Such individuals can immobilize a population by cutting off or rationing gas. They can shut down a city by shutting off the power. They can monitor and control individuals as long as their power consumption comes from a controllable source. (The first thing in a hostage situation, the authorities seek to shut off the power and water).
This centralization of essential commodities and resources, not only makes for greater control of the population, it also leaves the country more vulnerable. Our own economic and military tools of social control make us vulnerable. The centralization of capital in a few, highly-regulated banks increases government power over the citizenry. It is easier to track and trace the flow of money in society and also easy to centralize the economy. A cozy relationship between a few mega-banks and their government friends and regulators allows for reckless banking behavior, comfortable that there will be a taxpayer-funded bailout when things go awry. For the elites’ side, they know that these mega-banks will be easy to muscle into compliance with any economic scheme they imagine through the use of targeted legislation or even selective prosecution of individuals on some trumped-up charges. In the banking sector, we have already seen in 2008, the vulnerability created by the “centralization” impulse. Imagine the economic devastation on small cities if WalMart suddenly goes out of business or dramatically raises prices. What happens when there is no longer any competitor to compensate for the loss of inputs? How much easier is a “rationing” scheme or “price controls” when there is only one store in town? On the electrical front, an identical equation applies. Distributing power to the populace from centralized production centers along controllable power lines lends great power to relatively few individuals. A partially decentralized power system utilizing solar power, individual wind turbines or other means of power production, while being more resilient in the event of a crisis, whether it is an attack by hostiles, zoo events such as the mass blackouts of the 1990s or natural disasters, it would also give greater capacity for self-reliance to individuals.
The very concepts of democracy, liberty, and self-governance stem from societies where the yeoman farmer took care of the vast majority of his own needs. By personal contract, he could trade with other individuals to acquire that which he could not produce for himself. This self-reliance and confidence led him to be unwilling to submit himself to paternalistic governance as he was unwilling to make himself into a helpless, dependent child upon attaining adulthood.
Dispersion and decentralization of all elements of our society to whatever degree possible not only make us a more resilient, enduring, and invincible nation, it has the potential to breathe fresh life into the free society our Founders imagined for us. While one can expect the power elites to fight the idea tooth and nail, pugnaciousness and the democratization of technology will, hopefully, allow the individualism of the American citizenry to prevail. Victory lies with individuals and our willingness to “think small”.
