Peak Complexity and Unsustainable Debt

"Complexity" is an important issue in our times because it describes the inevitability of certain processes occurring in systems. While we might discuss exactly what is bound to happen exactly when, the overall drive and direction are indisputable: systems, as they grow, increase their levels of complexity, until they no longer can. That is, until it’s their very complexity that inhibits further growth. Then a move towards decreased complexity, or increased simplicity, must begin, a move that can be extremely painful. One could describe the collapse of the Western Roman Empire as a massive simplifying of a system that had grown too complex to be sustained.

Here is a more current example: Increasingly complex debt instruments have increased debts (disguised as easy credit), whether they are personal, corporate or governmental, to such levels that they can no longer grow - we can't pay them off anymore without assuming additional debt. And since we have built our entire financial and economic systems on credit - and hence debt -- there must follow a period of deleveraging. A warning sign should be that for every additional dollar put into the system, returns today are diminishing to the point that they threaten to become negative.

It's hard to see how this could not be extremely painful for most of us. Joseph Tainter's pivotal work is called the Collapse of Complex Societies for a reason. In nature, in physics, systems don't collapse gradually, or very rarely so; in 99% of cases, it's more like sticking a needle into a balloon.

For me, as an anthropologist, I find it increasingly useful to examine our predicament -- peak, peak credit, peak everything -- as an instance of complexity gone wild. The past is littered with examples of what happens in these circumstances. But of course, there is always American exceptionalism to fall back on. I doubt that can provide the same kind of assurance it used to.