Wednesday, March 26, 2008

Efficiency vs. Resiliency

mrvnmouse has an interesting post about his employers giving up on regular, scheduled maintenance and instead just waiting for important things to break. In the name of cost-cutting and efficiency, disaster ensues. You could run a search/replace function on the entire post with "my workplace" changed to "any level of Canadian government you care to name", and it wouldn't lose its accuracy at all.

Given that just yesterday I strongly disagreed with Thomas Homer-Dixon at one of my other haunts, let me make up for it by bringing up one of THD's other points that is very important: in many ways that we don't often consider, systems can either be designed for efficiency or resiliency, but not both. "Resiliency" in this case is defined as being able to withstand and adapt to external and unpredicted shocks. Our electrical system today is not resilient in this sense, but it is relatively efficient within the metrics it's designed to meet. (There are of course many arguments about whether those metrics are appropriate.)

Or look at the financial system. For decades it's been getting "more efficient" as transaction costs were lowered and regulations were either removed or ignored outright. But we now have a system that is collapsing from the inside because of something even worse than an unpredicted shock: a predicted one. (What, you thought home prices were sustainable?)

THD's point, near the end of The Upside of Down, is that we need to escape from a cult of efficiency and rebuild our systems around an ethic of resiliency -- or dare I say it, sustainability. We sacrifice some marginal expense in exchange for substantially improved reliability and predictability.

There's this idea, touted far too often by right-wing environmentalists (they exist!) that what we need is an end to subsidies, a carbon tax, and nothing else. Sorry, won't cut it. We need a wholesale regulatory change for the way we do a number of things, from finance to the environment, because what has failed is not just some isolated part of these systems, but the ideology that has built them in the first place.

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