Future Security: Trading Efficiency for Redundancy

by Cameron Schaefer on August 29, 2010

Recently a chorus of voices from various backgrounds have been pointing to the patterns found in nature as holding the keys to the future security and ultimately survival of an increasingly fragile globalized world.

The argument goes something like this: globalization has exponentially increased the complexity of modern civilization and eliminated many of its redundancies (inefficiencies?) based on the pursuit of specialization and comparative advantage.  While many praise, and duly so, the various benefits of globalization, few understand or acknowledge the fragile state it has created in its campaign for greater efficiency.

The stripping away of redundancies and growing interconnectedness of nations and markets now makes a “butterfly in Brazil” scenario more likely as the global system has become much more sensitive to change and less robust.  To secure ourselves from future doomsday scenarios we should model nature and trade back some of our efficiency for increased redundancy and robustness.

Nassim Nicholas Taleb has been hammering on this theme for years now, adding a new updated section to “The Black Swan” on Robustness and Fragility,

First, Mother Nature likes redundancies, three different types of redundancies.  The first, the simplest to understand, is defensive redundancy, the insurance type of redundancy that allows you to survive under adversity, thanks to the availability of spare parts.  Look at the human body.  We have two eyes, two lungs, two kidneys, even two brains (with the possible exception of corporate executives)—and each has more capacity than needed in ordinary circumstances.  So redundancy equals insurance, and the apparent inefficiencies are associated with the costs of maintaining these spare parts and the energy needed to keep them around in spite of their idleness.

The exact opposite of redundancy is naïve optimization.  I tell everyone to avoid attending (orthodox) economics classes and say that economics will fail us and blow us up (and, as we will see, we have proofs that it failed us; but, as I kept saying in the original text, we did not need them; all we needed was to look at the lack of scientific rigor—and of ethics).  The reason is the following: It is largely based on notions of naïve optimization, mathematized (poorly) by Paul Samuelson—and this mathematics contributed massively to the construction of an error-prone society.  An economist would find it inefficient to maintain two lungs and two kidneys: consider the costs involved in transporting these heavy items across the savannah.  Such optimization would, eventually, kill you, after the first accident, the first “outlier.”  Also, consider that if we gave Mother Nature to economists, it would dispense with individual kidneys: since we do not need them all the time, it would be more “efficient” if we sold ours and used a central kidney on a time-share basis.  You could also lend your eyes at night since you do not need them to dream.

In an e-mail discussion with Timothy Thompson he drilled down the objections of many in this growing crowd to a more specific risk,

…the whole globalized economy relies on just one critical element: cheap transportation. And cheap transportation means cheap transoceanic container shipping, which in turn relies on just one critical factor: cheap oil. The world economic system can be disrupted at any time by simply increasing the price of marine fuel.

So, an entire global economic system has become dependent on the price of just a single commodity, crude oil.

From a security standpoint, the anti-globalization crew also write that any terrorist or military threat that stops transoceanic container cargo also stops most of the world economy.  So just one big terrorist bomb arriving in just one shipping container in just one port can cripple the whole global economy.

In coming up with solutions, John Robb is making a good go of it with his study and writings on resilient communities, also modeled in Suarez’s “Freedom.” He believes one of the answers to the potential problem of long-distance production and shipping is the use of 3D fabrication technologies to manufacture tools and products locally.   In his own words, “Localize Production.  Virtualize everything else.”

Concerning food, we can already see a glimpse of this ethos  in the rise of urban farming and local farmer’s markets.  It’s very possible that this will spill over into manufacturing (See Etsy) as the technology becomes cheaper and more readily available.

So, what to do as an individual?  Well, globalization is not going anywhere for now.  Rather than fighting its advance or holing up in a cabin in Alaska, the best stance may be to skeptically embrace its benefits, rebuffing naive claims of global utopia, while doing more to safeguard ourselves against its weaknesses.  It’s a balance of course.

Here are some links to articles and videos discussing the themes of efficiency, redundancy, nature and security:

Nassim Nicholas Taleb on Robustness





{ 5 comments… read them below or add one }

Collin August 30, 2010 at 3:20 pm

These are some interesting thoughts Cam. I had no idea that corporate executives had different anatomies from the rest of mankind…but I guess it makes sense seeing as how they are all so stupid and evil. In all seriousness though, the ideas on the need for redundancy and how it isn’t encouraged by traditional economics and globalization are pretty convincing. However, I would question the analogy on some points. I think it breaks down in some pretty obvious ways. For example, while our bodies do have 2 eyes, 2 kidneys, 2 lungs, etc, we also have only one heart, one spinal cord, one trachea etc. And we definitely need those things to live. So it seems that more important than simply building redundancy into every aspect of the economy (aka manufacturing toys and clothes in every village on the planet instead of getting them cheaply from China) it is neccessary to determine where redundancy makes good sense and where it isn’t really necessary. And maybe that has already happened to some extent, naturally? I really don’t know if has or not, just asking you to consider ways in which it has.

I’ve been thinking a lot lately if we might be seeing the end of America as we know it and the prosperity we were raised in. There’s certainly enough voices out there saying as much. But I just had this thought: What if all these Robbs and Suarezs and Talebs aren’t just another generation of doomsdayer prophets predicting the end of the world. There have been similar people in every generation, full of convincing arguments about why their time was the worst. And the thought captures our imaginations and our hearts because it is, in essence, full of truth. The world will be ending…someday. And God intends we don’t forget it, so he planted the idea in man’s heart. Any chance of that?

Hope you’re doing well, say hi to the family for me!

Jeff September 1, 2010 at 12:22 am

Mr Schaefer,

Been recently reading your blog and enjoying it. A bit heavy for me but your warrior-philosopher style encourages me to be less intellectually lazy.

What do you think are practical steps normal everyday citizens can brace for failures in the infrastructure, besides the standard 72+ hours of supplies?

Shlok September 1, 2010 at 8:36 am

Jeff. Start a garden. Get to know your neighbors in a real way. Cut spending to the bone. In short, absorb the functions you generally rely on other folks for (everything from cleaning your car to electricity generation). Build excess capacity at a local level (in conjunction with your peers.)

Bottom line is, the global living standard is flattening out. 3rd world living is a good model. (Public institutions aren’t useful unless you know people, have money, or can bribe. Credit is extremely tough to find. The black market and the white market blur into a grey mess. Etc.)

Cameron Schaefer September 1, 2010 at 12:45 pm

@ Collin,

Analogies are never perfect, but I think you’re right that not every aspect of the economy needs lots of redundancy. The ones I see that are not redundant that should be more so are food and energy. If soccer balls and dresses are still made in Taiwan or China I don’t really care, but the fact that the majority of our food is produced by just a handful of companies is quite startling.

Companies like Monsanto have created huge monocultures where all the crops are identical and require large amounts of chemicals and energy to grow. Monocultures are hugely risky because one mutant strain of disease can wipe out the entire lot. It’s like playing chicken with nature. Thankfully there are people trying to reverse this trend by starting seed banks, and seed saving initiatives so that we can produce a variety of organic heirlooms, but there’s a TON more work to do.

Second, with energy, despite small amounts of progress here and there we are still a world that relies almost entirely on a single type of energy, crude oil. It’s not efficient at this point for companies to switch to other forms of energy and this creates a large risk, as mentioned above.

I know that you will counter that we will adapt when necessary like we discussed in a previous post, but the debate is not whether we will adapt, we will, but will it be quickly enough to not cause huge amounts of hardship on individual citizens…on this I’m skeptical.

@ Jeff,

Couldn’t put it much better than Shlok. My only addition would be to be ruthless with debt. In unstable markets debt is a huge liability.

Collin September 1, 2010 at 2:52 pm

Thanks Cam, that answers some of my questions. I think a case can be made for a need for greater redundancy in both the food and energy arenas. Peace

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