Books in Brief (July-August 2011)

Edited by Rick Docksai

Crisis Modeling

Crashes, Crises, and Calamities: How We Can Use Science to Read the Early-Warning Signs by Len Fisher. Basic. 2011. 233 pages. $23.99.

A stock market crash and a volcanic eruption have at least one thing in common, according to science writer Len Fisher: People can foresee them if they know what to look for. As Fisher explains, most of the worst natural and human disasters strike quickly but with some prior warning signs. In Crashes, Crises, and Calamities, he describes how new models of system processes and system breakdowns can help observers to anticipate hurricanes, tornadoes, economic crashes, mass riots, and many other deadly situations.

Fisher describes the four processes—positive feedbacks, acceleration past the point of no return, domino effect, and chain reactions—that are the primary causes of runaway disasters in the environment, economics, society, and even our personal lives. Each one, in its own way, pushes a system toward a “critical transition” point in which massive change takes place in very short time.

It used to be nearly impossible to spot a critical transition until it had already begun. New computer models in the last decade have vastly expanded our scope, however, and revealed common patterns running throughout many natural and human system failures. It is now possible to foretell when many natural or human-made systems are about to collapse.

Fisher offers examples of research models and how researchers use them. For example, a “fold catastrophe” model helps ecologists understand ecosystem degradation, psychologists make sense of mood swings, and anthropologists chart the rise and fall of human civilizations. Another, the “cusp catastrophe” model, illustrates the thought processes that lead college students to engage in binge drinking. No matter what the subject area, the right models help researchers to make sense of data and, ultimately, help craft sound public policies.

Some models are more accurate than others. Fisher advises that readers apply skepticism to critique the models themselves. He lays out sets of questions that an observer can ask to ascertain that the data, the model, the calculations, and the people conducting the tests are each demonstrably reliable. A model that fails on any of these four points will probably not offer reliable forecasts.

A book that describes scientific research models could easily intimidate average readers. Fisher’s book does no such thing. The author lays out the theories and their uses in very direct, conversational language. Crashes, Crises, and Calamities is well-suited for all readers who want to think creatively about their future and the world’s future.

A Former Oil Advisor Talks Climate Change

Earth: The Operators’ Manual by Richard B. Alley. W.W. Norton. 2011. 479 pages. $27.95.

Richard B. Alley is admittedly not the stereotypical environmental advocate: He worked many years for an oil company, and his political registration is right-of-center. But the Penn State geosciences professor, who is also an Intergovernmental Panel on Climate Change researcher, takes the greenhouse-gas threat seriously. In Earth: The Operators’ Manual, he explains why.

In simple—but data-rich—prose, he illuminates carbon dioxide’s role in warming Earth’s climate from prehistory onward. He lays out the conclusive evidence that dangerous warming is now under way, and that human-generated carbon dioxide is the culprit. Along the way, he rules out every other proposed cause of warming, from sunspots to volcanoes. As a corollary, he highlights the looming crisis in fossil fuels supplies.

He also tackles many objections raised by global-warming skeptics: He explains why the observed worldwide temperature cooling after 1998 does not disprove warming, why the 2009 “Climategate” incident does not discredit the evidence for climate warming, and why some countries had record snowfalls and cold spells in recent years even though the planet is allegedly heating up.

Alley calls for a measured transition away from fossil fuels, with taxes on carbon emissions imposed to incentivize progress. Then he walks readers through a variety of renewable-energy systems. None can replace fossil fuels just yet, he says, but the creativity and initiative that their inventors demonstrate should give us great hope.

Much of Alley’s information will be old hat to environmental researchers and energy insiders, but general audiences may gain many new insights. He shows a firm understanding of both the business world and climate science, laying out the facts in a direct but well-balanced and ultimately hopeful voice of authoritative scholarship. Lingering skeptics—and those wishing to debate said skeptics—will find Earth: The Operators’ Manual a worthwhile read.

The Dollar Isn’t What It Used to Be

Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the International Monetary System by Barry Eichengreen. Oxford University Press. 2011. 215 pages. $27.95.

The U.S. dollar was the world’s currency of choice throughout most of the twentieth century and the first few years of the twenty-first, but within a few years it became just one international currency among many, says Berkeley economist Barry Eichengreen.

Confidence in the dollar dropped precipitously in the wake of the 2008 financial crisis, he notes. Whereas international banks had bought billions of dollars of U.S. securities every year, U.S. assets were now viewed as toxic.

Eichengreen believes that the recovered, post-recession global economy will hold a reduced role for the dollar. India and its trade partners will use the Indian rupee for more transactions; Brazil and its partners, the Brazilian real; etc.

The twenty-first century world marketplace is distinctly multipolar: The U.S. economy thrives alongside those of Europe, Japan, and the surging BRIC countries. Also, mobile technology makes it easier for buyers and sellers in different countries to conduct transactions with different currencies.

But Eichengreen does not expect the dollar to go away. Not only are markets everywhere accustomed to using it, but some would suffer losses if they disposed of their dollars too quickly. Also, each rival currency has major problems of its own. Eichengreen concludes that the dollar will retain a dominant presence in international commerce for many years to come. However, the dollar’s stock will fall further if the United States does not rein in its annual budget deficits, he warns.

Some authors trumpet American exceptionalism, while others hold that the United States is on a path of irreversible decline. Eichengreen presents a well-reasoned middle path. Economists, public-policy specialists, and others curious about the future of the global marketplace will find Exorbitant Privilege to be an analytical and provocative read.

The Roots of Economic Recession

Fault Lines: How Hidden Fractures Still Threaten the World Economy by Raghuram G. Rajan. Princeton University Press. 2010. 260 pages. $26.95.

Economies may be recovering from the 2008 recession, but another meltdown may be inevitable unless major changes in worldwide financing take place, warns finances professor Raghuram G. Rajan. The “fault lines” that led to the last recession—income inequality, exorbitant debts, and high-risk capital—are still with us and must be fixed, he says.

The current system still rewards banks that issue high-risk loans and encourages financial institutions to buy delinquent debts en masse, according to Rajan. Traders assume that, even if their accounts fail, their governments will cover their losses.

Regulatory authorities are to blame, also. Many do not demand enough information from the financial institutions, and even when they do, they often do not disclose it all to the public.

At the country level, the world’s most prosperous economies, such as Japan and the United States, cannot grow without borrowing from China and other lender nations. Developing economies, meanwhile, depend too heavily on exports.

Rajan encourages light, targeted regulations that reduce risks but hold financial institutions responsible for their own success or failure. He also calls for open information channels that keep investors, consumers, and regulators fully aware of risks.

Social equality is also a must, according to Rajan. When a country’s citizens are deeply unequal in health-care access and opportunities for education, they will be more prone to unemployment and high debts. A country that maximizes opportunities for all its citizens, however, will better withstand economic ups and downs.

Recession-weary readers may consider Fault Lines grim news. Rajan makes no secret that the existing market systems greatly worry him. But he also expresses hope that, if the world community learns the right lessons from the latest recession, a more stable and equitable world economy may be in our future.

A Post-Western Global Economy?

How Asia Can Shape the World: From the Era of Plenty to the Era of Scarcities by Joergen Oernstroem Moeller. Institute of Southeast Asian Studies. 2011. 540 pages. $49.90.

A new global economic system will emerge this century, and Asia will probably be its center of gravity, argues Joergen Oerstrom Moeller, an Institute for Southeast Asian Studies senior fellow, in How Asia Can Shape the World.

Demographic and environmental challenges demand new economic models that use fewer materials and more manpower while balancing the drive to accumulate wealth with the realities of finite resources. The countries of Asia are well positioned to form that model, according to Moeller. Their millennia-old philosophical traditions prize harmony, sustainability, and social responsibility while discouraging materialism—and Asian businesses exemplify these principles by, in general, showing a greater sense of corporate social responsibility than their Western counterparts do.

Moeller also cites the growing size of Asia’s financial sectors and the increasing investments by Asian businesses in Africa, Latin America, and the Middle East. Also, Asia is becoming the primary market for the developing world’s raw-material exports. Over the next 25 years, China—not the United States—could be the most influential power in some developing regions.

Asian leadership of the global economy, however, is not a foregone conclusion. China, Japan, and their regional neighbors urgently need to modernize their educational systems to graduate enough qualified workers. They must also increase their domestic spending rates to compensate for shrinking workforces and aging populations. China faces the additional challenges of bringing more women into the workforce and creating new social-welfare programs to attend to massive future populations of retirees.

How Asia Can Shape the World is a global view of twenty-first-century economics, how they may evolve, and the role that the nations of Asia may play in their evolution. Its title may appeal foremost to scholars of Asia, but economists and policy analysts in any corner of the world may find it relevant.

Debating Geoengineering

How to Cool the Planet: Geoengineering and the Audacious Quest to Fix Earth’s Climate by Jeff Goodell. Houghton Mifflin Harcourt. 2010. 262 pages. $26.

Could purposely deploying clouds of pollutants that blot out sunlight be our last, best hope for averting catastrophic climate change? Proponents of “geoengineering” think so. Jeff Goodell, a journalist who contributes to Rolling Stone and the New York Times, explores current research into how—and whether—geoengineering might work.

In career journalist style, Goodell conveys interviews from a range of climate experts who have studied geoengineering. Their viewpoints vary: Some ardently support geoengineering, while others think it is ludicrous and maybe even dangerous.

Geoengineering would be foolhardy if we attempted it without understanding in full how Earth’s systems work, the critics tell Goodell. They contend that our knowledge is still very limited: Inaccurate weather forecasts and computer models of climate change that actually underestimate the extent of planetary warming effects both attest to this, they argue. They fear that geoengineering might unleash many unintended side effects, such as weather changes and altered water currents.

Plus, while it might stop carbon-dioxide-induced warming, it would do nothing to stop carbon dioxide’s other toxic effects, such as the destruction of coral reefs. Only serious reductions in emissions by humans can achieve that.

Knowledge gaps do not faze the proponents, who remind Goodell that climate change is happening quickly and with intensifying force. They see little time ahead for humanity to take action adequate to mitigate it. Geoengineering will be a winning solution, they argue, since it is faster-acting and less expensive than other alternative fixes.

How to Cool the Planet is a behind-the-scenes look at the debates and speculations surrounding geoengineering. Goodell gathers a range of voices, both pro and con. Environmentally aware readers who like a good debate will enjoy this book.

[Ed. note: See also “Dimming the Sun,” World Trends & Forecasts, May-June 2011.]

Towns That Take Care of Themselves

Walk Out Walk On by Margaret Wheatley and Deborah Frieze. Berrett-Koehler. 2011. 264 pages. Paperback. $24.95.

When the World Bank suspended its shipments of fertilizer and seeds to Zimbabwe, residents of Kufunda, Zimbabwe, feared that they would go hungry: Their farms had always depended on outside support. Then they conferred with their village’s elders and, under the elders’ guidance, created a new, localized agricultural system that could feed them year after year without government subsidies or NGO donations and with enough resilience to withstand droughts, pest infestations, and other hazards.

Kufunda is one of seven success stories told by Margaret Wheatley and Deborah Frieze, both former presidents of the nonprofit Berkana Institute, in Walk Out Walk On. The authors profile seven communities that implemented unique solutions to the problems that afflict cities and towns throughout the world.

The communities’ residents are “walk outs,” according to Wheatley and Frieze, because they exited from economic models, situations, and ideas that had confined them. Then they “walked on” to new concepts, practices, and opportunities by ceasing their reliance on outside help and direction. They drew upon their own initiative and ancestral wisdom to grow their own crops, produce their own energy, and create vibrant public spaces out of previously abandoned buildings and parking lots.

Although the communities’ development models are unique, they are guided by core principles that communities anywhere can emulate, the authors conclude: self-sufficiency, compassion, community wisdom, and listening to all of one’s neighbors, especially the poorest and most disadvantaged. Wheatley and Frieze hope that more communities will join them in walking out of resource-depleting and exploitative practices, and walking into empowerment of all people.

Community activists on every continent long for communities to become more sustainable and more self-reliant. Wheatley and Frieze’s Walk Out Walk On speaks directly to them by showing how some communities are making that transition in the here and now.