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Actually Too Big To Fail:
The History of Climate Catastrophe
And The Future of Work
Natasha Iskander, New York University
@natashaiskander
Louis Hyman, Cornell University
@louishyman
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The future of taxis—in the context of ecological change—is just a rounding error
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As we think about the future of work, we worry about the rise of robots, but not the rise of the
oceans
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We live in a time of converging crises and it can feel overwhelming, but we have seen this before
Climate Change
Automation
Migrant Populations
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We need to summon the political will in the face of a crisis that is not as visible as the Dust Bowl or
the Great Depression, but is happening nonetheless
“We must act. We must act quickly.”
President Roosevelt
First Inaugural Address, 1933
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The 1930s faced the convergence of the Great Depression and the Dust Bowl, both of which had
their roots in the financial speculation of the 1920s
Stock market speculation
Crash of 1929
Economic Crisis
Urban mortgage speculation
Mortgage Crisis of 1931
Farm mortgage speculation
Dust Bowl
Ecological Crisis
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The New Deal had bold experiments in remaking the economy, but it was less ambitious in ecology
• Restructured urban and farm mortgage system
• Restructured investment and commercial banking
Economic Crisis
• Created investment vehicles for cutting-edge
technology
• Created investment vehicles for locally-own
cooperative infrastructure
• Directly funded infrastructure
• And many more…
Ecological Crisis
Our economic
imagination
was stronger
than our
ecological
imagination
• Planted kudzu
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To confront these issues, we will need collaborative disagreement. We, for instance, disagree.
Approach
Mitigation
Adaptation
Perspective
• We need to fundamental alter the
assumptions of our political
economy to mitigate climate
change
Criticism
• Not realistic to expect to change
the rules of capitalism
• We need to adapt our political
economy to climate change, but
do not need to alter its underlying
logic
• Will not go far enough, fast
enough to stave off extinction
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To confront these issues, we will need collaborative disagreement
Adaptation
Jesse Jones
Reconstruction Finance
Corporation
Banker, Investor,
Publisher
Mitigation
Harold Ickes
Secretary of the Interior
Public Works
Administration
Politician
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To confront these issues, we will need collaborative disagreement
Approach
Representative
Harold Ickes
Mitigation
Iconic Quote
•
“We have left it so far to private
enterprise, and the conditions we
have are the result.”
•
“the bankers began to hoard. They
called in loans. They declined to make
loans. In the spreading fright the aim
… was simply to convert everything
possible into cash and let the
business of extending credit – the
lifeblood of commerce and industry —
take shelter until the dark skies had
cleared.”
Secretary of the Interior
Public Works Administration
Politician
Jesse Jones
Adaptation
Reconstruction Finance
Corporation
Banker, Investor, Publisher
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The causes of our crises today, as in the 1930s, are man-made, and the solutions must be as well
“We are stricken by no plague of locusts.”
President Roosevelt
First Inaugural Address, 1933
Mitigation
Adaptation
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The Dust Bowl was the worst ecological disaster in US History and becomes a political problem
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“We thought it was our judgment, we thought it was our doom”
Black Friday, April 14, 1935
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The Dust Bowl was in America’s heartland
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The Dust Bowl of the 1930s was the Great Plains of the 1910s
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The WWI price bump encouraged over-investment and the great “plow up” of the grasslands
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World War I prices never came back, and as suitcase farmers walked away, the soil turned to dust.
1/3 of the land became vulnerable
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Economic crisis and ecological crisis hit the poorest hardest.
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2.5 million people—mostly the poorest and those without resources—abandoned the land.
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These numbers sound big, but they are not. Economic systems are even more fragile than the
ecology.
Source: Hornbeck 2012
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“Okies” migrated at a time of economic crisis, which made them disproportionately visible
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The ecological interventions to fix the Dust Bowl were timid.
Hugh Bennett at National Erosion Research Center, OK
The Soil Conservation
Service does “more of the
same,” and doesn’t
meaningfully alter farming
practices
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Today, we are actually doing what we did before and expecting it to turn out differently
Wheat farming using aquifer water
Increases in Irrigated Farmland in Great Plains
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Drought and dust storms have returned to the Great Plains.
Dust storm in Oklahoma
Unplanted cotton field
We have not learned from the Dust Bowl
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The economic policies of the New Deal helped solve the underlying migration and investment
issues of the Dust Bowl, even when that was not their primary motivation
Flooded “Hooverville” shack in California (1935)
Hooverville in NYC
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~300,000 migrants went to California, most as pickers in the San Joaquin, and as workers in LA.
Source: Gregory 1989
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Our banks today also have trillions in idle capital that needs to be invested.
Reserve balances
$billion
$2,420
Banks have $2.3 trillion
sitting unused.
$2,322
For comparison…
the entire federal budget
is $3.8 trillion
$98
Required
Maintained
Source: http://www.federalreserve.gov/releases/h3/current/
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The Depression was a crisis, in part, of idle capital. More than a graph, consider this letter between
the heads of Citibank and Bank of America
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The New Deal was not just about spending; it was about investing to restart the economy
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A variety of public institutions rechanneled private capital, making postwar capitalism possible
Private
Capital
Federal
Market
Making
Borrowers
Outcomes
• Local banks
• Finance companies
• Suburbia
• Car Loans
• Home improvements
• Local cooperatives
• Farm electricity
• Electrical equipment
• Consumer goods
• Monopoly and
oligopoly
corporations
•
•
•
•
Aluminum
Synthetic rubber
Planes
Electronics
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Aerospace, like many other industries, took off through massive investment in the 1930s. Private
capital was channeled through government mechanisms into novel industries.
Al
The New Deal
creatively used
finance to create
incentives for
private capital
investment in
risky, but growing,
areas
Housing
Electricity
Aerospace
Electronics
Mining
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How do you get someone to invest in something that seems impossible?
Aerospace
Climate Change Industries
?
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In the 1930s, the airplane remained an oddity, and aerospace a small industry with possibilities,
like spaceplanes today.
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The Defense Plant Corporation, now forgotten, created the American aerospace industry and other
key sectors of the postwar economy
Key facts:
• Provided insurance program for private
investments in unproven technologies
• 3/5 of DFC funds went into aerospace (the rest to
aluminum and electronics)
• By end of war, aerospace was 4x larger than prewar auto industry
• 1000 airfields built (before WWII only 28 fields
nationwide)
• Created new centers of manufacturing in the West
and Midwest, where Dust Bowl migrants went.
American aerospace was, basically, created during World War II
The war legitimated the quasi-corporation but the war was not necessary for the
ways in which the DPC promoted the investment of private capital
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Other industries, like aluminum, benefitted as well
RFC Financing (December 31, 1945)
$millions
Aerospace
3,184
1,148
Steel
Synthetic rubber
1,056
842
Aluminum
Magnesium
449
Industrial chemicals
214
Other metals
178
Radio
120
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Aluminum transformed from a 19th century oddity into a 20th century commodity, like we need to do
with non-carbon energy. We need green energy to transform from gold to disposable.
Aluminum and Gold Bracelet (1858)
Beer can (late 20th century)
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Doing this today would cost a total of $95 billion, which is a drop in the bucket. What is the
aerospace of today that doesn’t require so much oil?
RFC Financing (December 31, 1945)
$billion in 2015 dollars
Reserve balances
$billion
$2,420
42
Aerospace
Steel
15
14
Synthetic rubber
11
Aluminum
$2,322
6
Magnesium
Industrial chemicals
3
Other metals
2
$98
Radio
2
Required
Maintained
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When we think about coming out of the Dust Bowl and Depression, we need to realize that there
was not just one solution, but a variety of—often inconsistent—experiments
Mitigation
Adaptation
Not all were successful, and some of
them were total failures.
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Climate change is multifaceted, so let’s just consider rising sea levels
Post-Katrina New Orleans
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Our coasts are extremely vulnerable to rising oceans
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And our coasts are where our economy is most productive
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And our coasts are where we invest our capital
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Climate change in the 1930s disrupted a sector in decline. Our climate change will affect our coastal
growth sectors where we are investing our venture capital.
Agricultural workforce (1800-1960)
millions
12
11
10
9
8
7
6
5
4
3
2
1
0
1800
1830
1860
1890
1920
1950
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Regardless of whether we stop emissions today, or continue as we are, there will be consequences
New York City (one meter rise)
San Francisco (one meter rise)
Facebook
Google
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New Deal policies are not a “playbook,” they are experiences, warnings, and encouragements that
should help us think about the future
Past Failures
Past Successes
Avoid “doing more of same”
Collaborative Disagreement
Investment is easier than abolition
Inconsistent Experimentation
Poorest will be hit hardest
Portfolio Mindset
But the world today is not the
same as the 1930s…
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Unlike the New Dealers, we know what is coming, and can hopefully avoid their mistakes. Our
solutions need to take account of both current options and hoped-for technology
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I believe that we can creatively finance new technologies and work practices that will help mitigate
climate change. We must remake capitalism to be greener, more profitable, and more ethical.
Now
Future
Adaptation
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What would avoiding “more of the same, only different” look like today?
Autonomous Cars
Rethinking Urban Zoning and Transportation
Mitigation
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The New Deal approaches to the Dust Bowl show us about that without earth, there is no mitigation
Institutions
Finance
Emphasis on how we interact with each other
Agriculture
Land Use
Emphasis on how we use the earth
The Earth is unchanging, except for when we change it
“Rain follows the plow”
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The New Deal approaches to the Dust Bowl show us about that without earth, there is no mitigation
Institutions
Land Use
Emphasis on how we interact with each other
Emphasis on how we use the earth
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Today, conversations about climate change and the future of work are largely separate
Climate Change
Future of Work
Changing Earth
Changing Production
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For mitigation, we need to blend conversations about climate change and the future of work*
Climate Change
Future of Work
• Who are the
interlocutors?
• Who is excluded?
Changing
Changing
Earth
Production
• What knowledges are
ignored?
Questions
Experiments
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What questions emerge? How do they help us think about the future of work and the creation of a
new moral economy?
 How do we move Silicon Valley?
 Should we be focusing on robots? Where are we
THE FUTURE OF WORK
AND WORKERS
focusing our innovation? Why?
 What is green industrial policy? What is the role of
governments? Supra-governments?
 Will sea level rise transform our economies? What
are the forcing points? What are the vulnerabilities?
 How do refugees support green development? How
do we think about dislocation? Of people, of production,
of finance, of networks?
 Why are we talking about the United States when
climate change is global? What is the right scale for
thinking about the economic implications of climate
change? Local? Global? Watershed?
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Adaptation and mitigation, as frameworks, serve as answers to different kinds of problems
Approach
Information
Policy
Adaptation
Mitigation
Analytic
Interpretive
Clear price signals
Interactions we cannot
decipher
Reform
Revolution
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To succeed in meeting these future challenges, we need to shift our thinking. Unlike in the
1930s, we know what is coming. We can’t stop climate change, but we can prepare.
Catastrophe
Possibility
Paralysis
Adaptation and Mitigation
Fixed
Flexible
Short-term metrics
Long-term metrics
One-time ecological event
On-going ecological rewriting
Emergency response
Redundant systems
Constant world
Changing world
Possibility of one-shot solution
No one-shot solutions, just multiple adaptations
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The Future of Work can and must help us address these issues. The conversations need to
be brought together. We need to both mitigate and adapt if we are going to survive.
Stopping climate change will be
impossible at this point.
We need to creatively adapt our economy
to climate change, and mitigate further
ecological erosion.
The analogy of the 1930s is not perfect,
but it helps us surface the blindspots in
the current climate change debates
[email protected]
[email protected]
@natashaiskander
@louishyman
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