Dimitry Orlov has been writing about the similarities between the peak oil caused collapse of the USSR and the US’ unfolding crisis. Orlov left Russia at the age of 12 to live in the US with his family. During the late 80s and early 90s he experienced the Soviet collapse first hand over several long trips to his home country. One of Orlov’s main goal is to educate people on what happens when economy crashes and money become worthless to supply people’s needs.
In The Five Stages of Collapse Orlov points out that about 3 years prior to its collapse, the Soviet Union went through a peak in its oil production and started to experience an energy crisis. Strickingly, experts argue global oil production achieved its peak in 2005, 3 years before the 2008 US economic crisis. Similarities, according to Orlov, do not stop at that. Both the US and USSR are plutocracies clinging to their power, resisting unavoidable change and ignoring its social responsibilities to its people.
The living arrangements in these two super powers however were quite different. In the USSR food and medicine distribution, housing and other community services, such as transport, were all provided by public services and were not, therefore, part of economic trades with the market’s logic. In addition, there was a culture of cooperation in the USSR.
The US, on the other hand, relies almost solely on the market economy to provide its citizens’ needs. There is, therefore, a huge reliance on finance and commerce to provide for people’s needs. There is also a great dependence on oil to move people and goods around. In addition, basic services such as housing, heating, health care etc. are all part of the market economy. For these reasons, Orlov argues that while the Soviet Union went to a ‘soft’ crisis, the US is going to a ‘hard’ crisis.
Based on both anthropological research and his experiences in the declining USSR Orlov devised the 5 Stages of Collapse. The knowledge of these stages, according to him, will help us prepare for the unavoidable global collapse; driven by the industrial era’s natural resource depletion. Orlov 5 Stages of Collapse also serve to explain how humans have a tendency to form complex societies with collapse inbuilt in them. The 5 stages of collapse might or might not happen in an orderly fashion. In fact, some might overlap and happen simultaneously while others might take place independently.
The First Stage is the Financial Collapse. This happens when faith in ‘business as usual’ is lost. That is, when risk cannot be estimated or controlled and people no longer believe that the future will be a linear progression of past and current financial practices.
The Second Stage is the Commercial Collapse. This stage reflects people losing faith that the market will always provide for their needs. In this stage people realise that money can no longer buy what they need to survive.
The Third Stage is the Political Collapse. At this stage people lose faith that ‘the government will take care of you’. This happens when elected representatives begin to be replaced with political appointees by the country’s creditors. At this point government loses all its legitimacy.
The Forth Stage is the Social Collapse. At this state faith that ‘your people will take care of you’ is lost. Charity and informal barter and gift based economy begin to fail and people deal with each other without the regulation of government financial institutions and the market.
The Fifth Stage is the Cultural Collapse. At this point ‘faith the goodness of humanity is lost’. This is when families can no longer hold the last stands helping and supporting their own and ‘human culture’ collapses. From this point onwards our behaviour is no longer recognised as human.
Orlov warns us that a healthy economic system has to be based on personal trade relationships and personal trust. It is about having valuable assets supporting a common trading scheme within small groups of people who know each other. Orlov advise us to imagine a world in which institutions (public and private) can no longer be relied upon and provide for our needs and, from that point on, ask ourselves what do we have to do to provide for our own needs where we live with the support of our families and neighbours.
Orlov, D. (2013). The Five Stages of Collapse: Survivers’ toolkit. New Society Publishers. Canada.