Just before we realized just how gobsmackingly stupid the people who manage contemporary financial institutions managed to be, I pointed out the upside of the incipient recession. Simply speaking, the first step to a sustainable system is an average growth rate of zero. Since we don't control growth perfectly, that means that what has heretofore been called "recession" is what we need about half the time (or more, if the growth phases are especially vigorous).
Of course, all of this depends on the question of what it is that is actually growing, a question which is far less trivial than is normally considered. The countereconomists have this part right in a fuzzy sense, with a tautology I = P A T. Unfortunately for the utility of the equation, the "P" is the only term which is really measurable all that well. It's easier to think in terms of dollars and carbon intensity; then the comparable equation is
delta-C = population * income * carbon_intensity
And, alas, the target delta-C is slightly less than zero! Go build an economic model on that!
So although there is something to be said for a gentle slowdown, the greenhouse problem doesn't stop worsening in a recession. It only stops getting worse at an increasing rate!
Anyhow, the idea of a relaxation is necessarily a gentle and calm period in contrast to a period of decay and decline.
It is looking very much like what we have is not a gentle slowdown, though. The great spike in gasoline prices has been followed by a great plummet; we are down about 40% here in Texas in the last six weeks and it wouldn't be surprising to see a pump pricve below $2 soon... This surely represents a great decline in demand. Now, in the grand scheme of things, fewer people driving around great distances for little substantive reason is probably a good thing, but because of how we've set things up, these people will be abruptly overcommitted and somewhat desperate.
So the fact that we need enormous capital investments to manage the infrastructure switchover to whatever it is we are switching to is getting swamped by the the habitual short-term focus that people have become accustomed to. Nobody in power is thinking about wind farms, CO2 pipelines or nuclear plants now. We have jumped right from overwork into panic without passing through relaxation.
So I see the lining, I just don't think it's silver.
We always knew the system was addicted to growth, and that readjusting to a non-growth world would be difficult. What we didn't understand was that the addiction had progressed to the hard stuff, that even a few months of decline would cause chaos to ensue.
Greenies, even responsible and stodgy folk like Gore and Hansen and Pauchari, (yes I most emphatically do mean that, what a world where Gore is cast as a radical!) have been saying everything rides on the next few years. Well, like Greenspan, I fear they have "made a mistake".
Thanks to Mr. Greenspan's little oopsie we have lost a few years if we are lucky. Probably a decade. Governments will have their hands full just keeping the boat afloat and will have almost no power to steer it. I hope I'm wrong, but it sure doesn't look that way.
So now we have to hope nobody remembers the "now or never" rhetoric of the past few years, because if it's now or never, it sure as hell looks like never.
Nope, that lining color isn't silver. Nosiree.
Relaxation, as I should have known, is out of bounds. Times only come in drunk or hung over anymore.
Update: Dear old friend D asks in email what I meant by that last statement. Maybe I should have said times only come in manic and depressed anymore. Is that clearer?