Post-Peak Living: Our Homestead Economics

As I read and pay attention to both the predictions about what post-peak like might look like over the coming decades and to what’s happening already, the one message that stands out is that it is time to get used to being poorer.

Under the pressures of extreme weather events and disruptions to normal weather patterns, increasing oil prices, and a no-growth/all-debt global economic system, two things seem guaranteed:  everything will cost more, and our wages will not keep pace with that inflation.

The truth is, this has been the case for a long time.  I’ve been working in public service for more than a decade, and I don’t remember the last time a normal, cost-of-living raise was negotiated in a collective agreement I’ve been a part of.  Purchasing power in our neck of the woods has been declining since the 1970s, despite the availability of more cheap stuff.  After all, perhaps the biggest change in purchasing power since the 1970s, the aspect that has kept our western economies afloat for all this time, is really the massive increase in credit available.  Remember how in the 1970s you needed 25% down to buy a house?  And there was no such thing as credit cards?

So the value of our income is going down.  Prices on everything are going up.  And we’re likely to continue in a global economy that is debt-ridden and has run out of ways to grow its way out of recession, which means public–government–spending will also continue to be scaled back, along with our support services.  It’s time to start embracing poverty.

So I’ve been considering the question as I assess the resilience of our lives: How do I want to be poor?  Poverty is usually associated with people who have few choices and live on the desperate edges of survival, and no doubt this will describe more and more of us as the years go by.  But as someone who spent MANY years as a university student working part-time, I know that poverty can also mean living simply but joyfully on not very much money.  At this moment, our household has options, and my goal is to use this time of relative luxury to set up systems that will allow us to live on a much smaller relative income with dignity and little sense of deprivation or despair.

In 15 years, the Skipper will be ready to retire–at least that’s the goal.  At that point, if the economy allows, I could still work at high-ish wages for another decade.  But during that transition, I would like to be as little dependent on working incomes as possible.  And if one or both of us loses a job or we have our incomes go down (or hyperinflation kicks in), it would be nice to be able to continue a reasonable life without ending up on the street.  So we want to start making the wider economy redundant to us, before it makes us redundant to it!

Taking a hard look at our home economics in this light, though, is sobering.  We have been on the “simple living” bandwagon for many years.  The old rhetorics about getting rich by cutting out lattes and investing in mutual funds definitely don’t apply to us!  We don’t “go shopping”, we brown bag it everyday, and we value quality over quantity.  No keeping up with the Joneses here!

But our situation is by no means secure.  We have some debt, and we have used credit to do some of our home and garden infrastructure improvements.  We have a mortgage on a 30 year amortization that I don’t want to take 30 years to pay off; the sooner we OWN land, the better.  I have a small student loan that I previously put in the category of “good” debt, but now don’t see that way.

If the essentials of life are food, shelter, and water (not necessarily in that order!), right now shelter is costing us a LOT.  The mortgage, property taxes, home maintenance, required insurance, and the electricity that runs our basic water and septic functions add up to the biggest chunk of our budget.  Other debt payments are another big chunk, if we include a vehicle, student loans, and credit cards (because we’re paying them aggressively).  We live at the halfway point between 2 small cities: Skipper commutes south, I commute north.  Commuting is environmentally toxic, but also expensive: gas, maintenance, insurance, and a vehicle payment also take a big bite out of our incomes.

Food is complicated.  On the one hand, eating out of the garden is WAY cheaper than buying all those fruits and vegetables (especially organically) at the supermarket.  The garden does save us some money, and I will continue to push toward growing all of our vegetables and most of our fruit for the year.  I do spend money, though, on seeds, organic bulk fertilizer ingredients, and in the last 2 years, building more raised beds.  We provide our own eggs and some chicken and crab/fish, but there are background costs to these as well–feed costs for instance are dramatically on the rise, and that’s before this year’s drought affects them.

There are still all kinds of food items that we will continue to need to buy: grains and dairy seem the most obvious.  I’ll definitely be doing some research about how to mitigate these costs.  We’re in the middle of the year’s provisioning, and I’ll be tracking the math more carefully than usual, and will share what I find.

Here’s the puzzle for us in a nutshell.  We’re getting by, and if all things were going to stay the same for the next 20-30 years, there would be no issue.  We’ve been playing by the popular culture’s economic rules, and by the normal account of things, we’re doing fine.  But if I look a little deeper, our security is more tenous.  We also have projects that we want to undertake to improve our resiliency–a new roof, hardwood flooring, wood storage, etc etc.  At the moment I’m not sure where the money for these things will come from.

My goal is to massively decrease our need for incomes over the next 15 years.  But given the major expenses that we have right now, we have to think hard about how to do that.

Here are the options I’m considering:

Plan A: We will be spending some time over the next few months paying close attention to our spending, to see just how we might be able to cut back on whatever luxuries we have.  There’s not a lot of fat to trim, but I’m sure there is some.  The sad part is, though, that some of those luxuries are ways in which we support important local economies.  For instance, instead of making our own bread, which would be cheaper, we buy it from our extraordinary local bakery.  Although we’ve made our bread often over the years, the bakery we support is investing in local grain production, which benefits our whole region.  So part of this exercise will be thinking through the security of our purchases.  The usual frugal rule of finding the “cheapest” option is a false frugality, because it *increases* dependence on the tenuous global supply chain.

Plan B: Depending on how much we’re able to refine our current spending habits, we may have to look at more radical changes to our lifestyle to free up the cash to pay off the debts, own land, and have a system set up on our land to support a less cash-dependent lifestyle down the road.  Here’s where things get tricky.

We can try to decrease our mortgage.  The real estate trade-offs that affect price are the condition of the house, the size of the house, the size of the property, and the location.  To decrease our mortgage substantially, I’m willing to decrease the size of the house and property, but those two have to remain practical for reasonable food production, processing and storage.  Changing location may be an option, but moving closer to town, where prices are cheaper, also means higher property taxes and more rules–chickens aren’t yet permitted in town, for instance.  Skipper is a carpenter, and in theory fixing up a cheaper house is an option.  But we’d have to make sure that the costs of renovating and retrofitting don’t outweigh the savings in the mortgage.

I’ve considered even more radical options: selling the house, paying off the debts, saving the rest and moving on to a boat or into a trailer for a few years to build up some cash reserves before re-entering the housing market.  But these mean that we lose our capacity for food production, at least in the short term.

Another option is to try to cut down the cost of our commutes.  We’re making some choices about this already; we’ve decided not to replace my fuel-efficent beater, which we think will still keep going for another few years with some money put into maintenance.  It also looks like down the road I might have an opportunity to work closer to home (or more from home), and I’ll focus on that in my project decisions.  If we’re looking at the 15 year mark, and Skipper retiring, then that also takes care of a commute.  However, depending on where gas prices go, we could also consider making a more radical decision to move closer to one job and have the other person find a job in that community.  We both have very good reasons to hold on to the jobs we have, though!

Moving has the potential to make our lives more financially secure, and may prove to be the best option as time goes on.  But it has some big downsides too.  We’re in a house now that needs little retro-fitting.  We’ve replaced almost all of the appliances and toilets with efficient, low-water ones.  We have done a lot of work to the garden to get it producing well, and there’s lots more we could do.  And we’re in a community that has a lot to offer, including the kind of barter and exchange that is so necessary to replace the dependence on outsourcing-for-money.

Plan C:  Plan C is to continue as we are, doing our best, and using short-term credit as necessary.  Then, if things really do get difficult, we consider renting out a room, taking on extra work, etc to make up the difference.  This goes against my pro-active nature and my gut response to the stories on the news every day, but it is a totally valid option which many will pursue out of necessity.

Those are some of the tough decisions that post-peak life has us considering.  How about you?

Surviving the Age of Transition

Yesterday’s top news stories:

In Eastern British Columbia, a toxic mining tailings pond threatens to spill its waste in a small community, potentially contaminating everything in its path including rivers and drinking water.  The cause? Record rains straining the dam.

Extreme heat..well, you know..everywhere (except the PNW), and still almost 100,000 without power almost a week after an extreme weather event on the East coast.  And, of course, forest fires burning up Colorado and neighbouring states.

In BC and Washington, the shellfish industry is scrambling.  Ocean acidification means that shellfish hatcheries’ seed stock cannot form shells.  They are now rearing the seed stock in places like Hawaii, where, for the moment, the acid levels are still tolerable.  The companies then ship the young shellfish back to grow in local waters when they are older and can tolerate the conditions.  The commercial industry is adapting.  Unfortunately, wild stocks don’t have that option.  Mussel beds are not reproducing.

Ocean acidification happens because the oceans absorb 30% of our atmospheric carbon.  Unfortunately, the acidification that we’re experiencing now is from C02 absorbed 30-40 years ago.  So even if there was no atmospheric carbon left to absorb, we still have 30-40 years worth of absorbed carbon on its way.  Goodbye marine food.

The global economy is still flailing 4 years after the major collapse in 2008.  No sign of recovery in sight.  Canada was one of the least affected nations in the world, and we are an energy exporter.  But in this global economic climate, the best we’re seeing is flat “growth.”  Guess what one of the major causes of the meltdown was?  According to the Wall Street Journal, the 2008 spike in oil prices may have been the tipping point.

…To recap: massive species die-off, extreme weather events straining our infrastructure, rising cost of living and flat wages, long economic recessions (when does this qualify as a Depression?)…

Umm, folks?  All those scary scif-fi-like predictions of a world affected by peak oil and climate change?  We’re already living it.  And there’s a concensus building that the tipping points that scientists have spent the last decades warning us about are now visible in the rear-view mirror.

I know I haven’t been posting much over the last few months, and this is one of the reasons why.  I’ve been immersed in the latest research into Peak Oil and climate change in preparation for a course I’ll be teaching in the fall, and the conclusions I’m coming to are leaving me in a thinly veiled panic.  In a nutshell?  We’re screwed, and it’s time to start thinking about how we’re going to survive.

Now, I am not a survivalist.  I am a skeptical academic who is suspicious of fear mongering and who has a sunny, optimistic personality.  And part of what is troubling me right now is just how difficult it is to predict the future.  There are experts out there warning us about the apocalyptic collapse of civilization, and there are others who take the long view of history and suggest a slow, grinding, decline is more likely.  After all, as John Michael Greer points out, after suffering two devastating world wars and a great depression, Europe still did not collapse entirely.

However.

We are looking ahead to a very different future.  Every country in the world is holding massive debt, which in theory falls on its taxpayers to repay.  Money that used to be in government trust has been funneled into and centralized in corporations, and is therefore unavailable.  Each extreme weather event that requires massive emergency funding sucks money out of the public coffers, and thus out of the rest of the economy.  With oil prices staying high (even allowing for modest fluctuation), rebuilding and maintaining our infrastructure gets harder and harder.  Food production is threatened by the double whammy of extreme and unpredictable weather coupled with high fuel costs that impact the cost of fertilizers, pesticides, running farm equipment, and distribution.  The cost of every consumer good continues to rise with the rising costs of production.

In the meantime, at the community level, my provincial government has started to sue its local municipalities to try to recoup healthcare costs.  Umm, fighting over scraps anyone?  I used to look to the natural landscape and systems to help supplement my attempts at self-sufficiency–hunting and fishing–to provide the protein that my small homestead cannot produce.  But those natural support systems–if the ocean acidification example is any indication–can not be counted on for much longer.

The burning question for me at the moment is: how long do we have?  And of course, that’s an impossible question to answer.  Way too many variables.  And this makes planning and preparing and adapting tough.

Right now, in this moment, everything is great.  Skipper and I have good jobs, we can afford our mortgage even if costs increase or wages go down in moderation.  The garden is in full swing, and happy, adorable chicks are racing around exclaiming over every new leaf they find.  We and our families are healthy, and our network of wonderful friends continues to grow.  I count our blessings every day.

But I’m looking around our homestead and lifestyle with fresh eyes.  If the economy (globally and locally) continues to shrink and prioritize, we will need to become increasingly self-reliant.  Right now, all of our water and septic needs require electricity.  Rain catchment is moving up the list of priorities, as is the “pizza” oven, which I initially considered a luxury.  But wood-fired ovens need small, hot fires from small brush, of which we have lots from our prunings.

I’m going to be experimenting with dehydrating in the greenhouse, which is otherwise too hot and dry to use in the height of summer.  Dehydrating is less power intensive than freezing or even canning, although I’ll still do that too.  I’ll be working at building my capacity to keep us in food year-round, but I won’t be investing in grow-lights.  As one friend put it: you can replace heat cables.  You can’t create light without power.  A small solar panel won’t power even a cfl grow-light at this point (and covering the greenhouse roof with solar panels defeats the purpose! 🙂 ).  But YMMV–depends what happens to our sunshine over the years to come.

Oh and permaculture?  I’ve been reading and admiring for a few years, integrating a technique here and there.  But I’ve been stuck in the idea that there’s little that’s “natural” about permaculture–you’re basically trying to imitate a natural system with imported plants in order to create something productive for humans.  But now I get it–permaculture is essential, and I will be picking up the new Garden Farming for Town and Country asap.  Because although working WITH natural systems is the only way to be productive without oil, climate change means that the ecosystems that we’re used to integrating into will be changing dramaticallly.  So we need to work with more resilient perennials, maximizing diversity, and creating food systems (even basic ones with annuals to supplement) that require few if any inputs in the future, when it counts.  In the long term, we will need to go back to living off the surplus of the land, but the land as it is is too degraded to support us.  Permaculture is the way to rebuild that support system.

I’m also reflecting on our chickens.  Our flock is very productive and useful; they will stay.  But the backyard chickens movement has really focused on dual-purpose birds, and I’m starting to question that.  Dual-purpose birds are calm, don’t fly much, and produce both eggs and meat.  Awesome!  But they were really bred for the integrated farm, to live off the farm wastes and surpluses, like grains.  They could also often forage over the whole farm property, which could provide lots of food.  Neither of these scenarios describes our situation.

The vegan argument around livestock has long revolved around the feed conversion ratio: even the most hybridized birds eat 2 lbs of grain to produce 1 lb of meat, which is a waste of grain that could be feeding people directly.  Now there are lots of reasons why this is not a useful argument, but the core principle remains: if grain prices continue to rise and my forage space is limited, are dual-purpose chickens the right livestock for us?  I will be investigating the Mediterranean breeds and the Euskal Oiloa to see if the more traditional third-world backyard bird–the scrawny egg producer that needs much less feed–is a more viable option.

Over the coming months, I’ll be considering every aspect of our lifestyles for their resiliency, and I’m prepared to make some radical changes if necessary.  After all, our family has a window in which to get better prepared, and I want to make the most of it.