So, what should we do? Some suggestions for adaptation to a changing world

Since I am not in charge, and no-one who is in charge is seeking my opinion, I actually don't need an answer to this question  :-)  

It might be interesting to think this through though. Its too easy to criticise without having something to suggest.

The problems we currently face are fundamentally driven by resource limits

Most people would agree that growth can't continue forever on a finite planet, at least in an abstract way. The Limits to Growth study in 1972 [1] was the first to look at what might happen in concrete terms, and it painted quite a shocking picture of the future. The study brought together everything we knew at the time about resource limits, environmental and social systems, population and the economy and studied the whole thing all at once as a self-consistent system of interacting parts. The conclusion at that time was that we had somewhere between 50 and 100 years before growth didn't continue on this finite planet.

There hasn't been any work in the intervening time that invalidates those basic conclusions, indeed the work that has been done is supportive of the original work. In case you've read otherwise, no, The Limits to Growth never claimed that we would "run out" of resources by the year 2000. The base case or "best guess" scenario in the original publication was that industrial output would be constrained by resource limits by about 2015, with uncertainty plus or minus a decade or two.

The most critical of those limits is the resource we rely upon, exclusively, to power our transport: crude oil. Transport isn't a luxury. It's the circulatory system that keeps our society alive, moving goods from where they're produced to where they're needed, and waste from where it's produced to somewhere (hopefully) out of harm's way. More generally, transport includes mechanized agriculture - producing those most basic and indispensable goods that keep us all alive. 

To a very good approximation, all of our transport system relies on this single resource, as a power source. The only real exception to this is electrified rail (which in Australia is a fraction of commuter journeys, and an irrelevance for freight). Electric cars make up a tiny fraction of private vehicles, many of which are anyway non-essential for broader social function.  There are no electric trucks deployed, beyond a few demonstration projects.

Given our existing transport infrastructure and systems, it is a fact that we are, and will remain, critically dependent on crude oil for at least the next decade or two. It takes that long to make a meaningful adjustment to infrastructure, even with a plan and concerted effort to do so [2]. Neither plan, nor concerted effort, are apparent to me just yet though.

We have grown up against these growth limits to the point where they are now constraining industrial output. We have left it much later to act than we might have done, and will now we have to decide what to do about it.

The structural demographic wheel turns

What may happen next has plenty of historical precedent, after all we aren't the first complex human society that's grown up against its resource limits.  Structural demographic theory as championed by Peter Turchin [3] describes the effect of decreasing resource availability per person. Competition creates what he calls popular immiseration - decreasing real wages and a falling standard of living for the "commoners". Commoners have been given lots of labels (working class, proletariat, "the 99%"). A useful definition is, that part of society that earns a living predominantly from their labour. The elite class, on the other hand (captalists, bourgeoisie, "the 1%"), earn a living predominanly from their investments.

The result of this popular immiseration is an increasing standard of living for the elite class as their costs (the wages of the commoners) fall in relative terms. Economic inequality rises, as does the population of elites. The rich get richer, and the poor get poorer.

Eventually the elites also suffer declining resources (elite opportunities), which increases inter-elite competition. Conflict results. Popular immiseration and economic decline weakens the tax base and hence the state monopoly on violence. Civil war between different elite factions can be the result [3].

Environmental changes add to the pressure

Neither of these matters minimise the effects of climatic and other changes to the environment. We are starting to notice the effects of these (fires, droughts, floods, coastal erosion) now, but they are not having a material effect on most of us just yet. Given the slow response of earth systems relative to human timescales, however, the changes that have begun are unlikely to stop or even slow down any time soon. To take one example, the circulation time of the ocean is of the order of 1000 years. That gives you an idea of how long it will take for the ocean to finish warming in response to a warmer atmosphere, or alternatively, how long we can expect sea levels to keep rising, even if we were to somehow manage to stop increasing the carbon concentration in the atmosphere by next Tuesday afternoon.

As climate systems move, we are going to have to move things too.

Farming systems will have to move in response to changing climate. As regions become wetter or drier, warmer or cooler, the agricultural systems best suited to that environment will change. As a society we will need to be prepared with systems in place to help agricultural communities either adapt or move, and be prepared to build supporting infrastructure as required. 

Infrastructure will have to move too. Sea level rise will continue, and is only going to speed up from here. The next 100 years is "baked in" already, more or less independently of what we do or don't achieve with emissions reduction. Losing beachfront homes is just the beginning. Have you ever wondered what fraction of the world's sea ports are at sea level? (answer: all of them) What's involved in moving sea port infrastructure as it starts to flood? (and associated infrastructure, like the road and rail networks that service them?) 

How would Australia then export its wheat to a hungry world? How would the rest of the world import it? How would we import diesel fuel? Most of our transport fuel is dependent on the continued operation of international supply chains, including shipping. We have a small and shrinking domestic refining capacity, and can produce a minor fraction of our transport energy needs through domestic crude oil production (which declines year by year). We produced 334,000 barrels of oil per day in 2021, and consumed over a million.

When complexity is the problem, more complexity is not a solution

Joseph Tainter is widely credited with the idea that complex societies collapse when the marginal return on increased complexity becomes negative [4].

You can think of society as a machine that solves problems through complexity. In response to pressures like environmental stresses, society will develop ways to do more with less, hopefully ensuring that everyone's needs will continue to be met. We develop more efficient ways of extracting and distributing progressively more marginal resources. The cost of this is added complexity. Improved extraction methods for more marginal ores are technologically and energetically more challenging, rules governing resource distribution (the laws governing economies, taxation and social welfare) become more complex and nuanced. Tainter gives lots of examples in his book, backed by real world data. Things get more complex over time, as societies grow.

The increased complexity has a cost. Energy inputs are higher to extract more marginal ores. Direct energy costs but also indirect ones like the higher education and training system required to train workers skilled in the advanced technologies. More tax dollars are spent to operate increasingly complex systems of distribution. Just managing the information flows in the more complex system requires more workers pushing pens (or keys) instead of directly providing goods or services to others.

The whole enterprise starts to come apart when the cost of becoming marginally more complex, exceeds the benefit of becoming marginally more complex. You might wonder why a society would ever do this when there is negative net benefit, but it's easy to see when the accounting is fragmented rather than holistic. A company, sector of society, government department, can think that things are improving when they account for costs imcompletely - externalising costs on to third parties is one way this can happen. The introduction of the GST in Australia is probably a good example - when you look at it from the government's point of view it looks like a simplification, but when you count the net cost over every business that now also has to become a tax collector, probably not. Solar power is arguably an even better example. How many times have you heard it said that solar power is cheaper than coal? It's true, but only when you consider the cost of setting up the solar power plant and the income that you earn from it. What doesn't get counted is the additional costs this imposes on the rest of the electricity generation system as it tries to offset the glut of power that's generated in the middle of the day, and the corresponding deficit at night. Nor are the costs of climate change accounted for. If you really want to compare the cost of solar power and coal power you have to compare the system costs of both: the cost of constructing and operating the plant, the negative externalities of greenhouse gas emissions and other pollutants; and the cost of storing sufficient electricity so that it can be delivered on demand. 

Collapse - which is the process by which societies "go backwards" on many measures - occurs because the costs increase faster than the benefits, and pretty soon the average welfare of individuals starts getting worse. This starts at the bottom of the social pyramid, but it works its way up to the top.

If you know you're going to fall, go early and do it with some control

The likely conclusion of the above is that a lower standard of living is unavoidable, and that serious social conflict is likely unless we are prepared to share the pain around in a way that looks after everyone. People will be willing to do this if they understand the need and if everyone is taking their share.

Here are some suggestions for a managed retreat from complexity and a reversal of increasing wealth inequality.

1. Radically overhaul the tax system to encourage the behaviour that's required. Eliminate income tax, raise all revenue through a progressive consumption tax (a GST or VAT) whose rate can vary for different classes of goods, and is higher for luxury goods. Pay everyone the same basic allowance, raised through tax (universal basic income). This discourages consumption and incentivises people to find ways to consume less. It preferentially taxes those who consume more - the "rich". On the flip side, get rid of most (all?) social security payments, and their associated systems and bureaucracy. Greatly simplifies the tax system, removing unproductive "complexity management" jobs. Use a system like Tradable Energy Quotas to ration consumption of scarce goods when needed. The rich can still earn a living through investment, but not through investment in unproductive asset bubbles (see number 9).
2. Decline-aware spending on transport infrastructure. Stop building new infrastructure close to sea level, and stop defending existing infrastructure at sea level (I'm looking at you, Collaroy). Stop building new roads. Forget high speed rail - too expensive and complex - build normal speed, dual track, electrified rail linking cities and major food growing areas. Plan for staged retreat of port infrastructure. Invest in LNG conversion or natural gas to synthetic diesel for long haul goods transport (both rail and road) in the short term, electric goods rail and electric short-haul trucks in the medium term.
3. Decline-aware spending on energy infrastructure. Public education about energy - this is so poorly understood by the public, the media, and most politicians. Coordinated research program to develop an integrated plan for increased intermittency in supply and reduction in demand. Electrified goods transport by rail that stops during periods of low supply (e.g. evening peaks), or relies on diesel / LNG backup or hybrid operation. Investment program in grid energy storage - off river hydro / gravitational energy storage / underwater compressed air energy storage (and batteries for short duration). New technology  is possibly helpful but we can't afford to wait. We need to go ahead now with technology that is already mature enough.
4. Decline-aware spending on manufacturing infrastructure. Decline is likely to lead to increased conflict within and between nations, and indeed at the time of writing we are already seeing this. On-shore enough domestic manufacturing capability to be able to maintain our own critical infrastructure.
5. Rationalise spending on health. Cost benefit analysis on healthcare provision and public health programs. Tax bads, not goods: levies on processed food based on sugar content. Science-based public education programs on nutrition (including vitamin D) and exercise. Progressively de-fund high cost / low benefit medical treatments as the resource base shrinks. On-shore manufacturing capacity for basic medical supplies including the most important medicines. Make sure we fund the basics properly.
6. Rationalise spending on education. (my colleagues will kill me for saying this but) we probably have more universities than we need. Reduce the university count and fund the remainder properly. Fully publicly fund (a substantially reduced number of) undergraduate places. Fund secondary education properly, including making teaching an attractive career choice. Make sure we fund the basics properly.
7. Defense and security. I don't know much about this, but it seems unwise to continue to rely on powerful friends. I suggested in a previous post that we adopt a porcupine strategy to make ourselves an unattractive target for larger powers. As a medium sized nation, soft power is very important. We should be the charming porcupine with lots of friends.
8. Help people who need help. People in Lismore got flooded recently. This is tremendously destructive for the communities involved and for all of us in one way or another. We need to spend the money to move people out of harm's way. Not just floods, but fires and coastal erosion. Not to reward people for arguably making bad choices, but neither should we be hanging people out to dry. It doesn't help them and the resulting dysfunction and conflict doesn't help the rest of us either.
9. Deflate speculative asset bubbles, especially housing. It's a waste of productive capital, we need to be investing in things that contribute social value, like all of the above. Steve Keen has the only sane proposal I've seen on how we might do this equitably for housing. He has some other great ideas like giving shares a limited lifetime of 25 years when traded on the secondary market (they live forever when issued initially as part of business raising capital). The rich can still live off their investments, but their investments will need to be doing something useful for society.

This can all be done, it needs to buy us some time to figure out what to do next. It needs to be fair, with a preference toward helping those at the bottom. And it needs to be planned, because these different parts interact. We need to work on this problem all together, not one piece at a time.

References used

1. Meadows, D.H, Meadows, D.L., Randers, J. and Behrens, W.W. "The Limits to Gowth", Universe Books, 1972
2. Hirsch, Robert L.; Bezdek, Roger; Wendling, Robert, "Peaking Of World Oil Production: Impacts, Mitigation, & Risk Management" (PDF). Science Applications International Corporation, U.S. Department of Energy, National Energy Technology Laboratory, 2005
3. Turchin, P., and Nefedov, S., "Secular Cycles", Princeton University Press, 2009
4. Tainter, J., "The Collapse of Complex Societies", Cambridge University Press, 1988