The Five Stages of Collapse by Dmitry Orlov provides a beacon to those who fear the end is nigh

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      By Dmitry Orlov. New Society Publishers, 281 pp, softcover

      As Canadians celebrate the country’s 146th birthday today, the last thing they’re thinking about is the end of their nation.

      But the demise of western industrialized countries is just one of the scenarios outlined in Russian-American Dmitry Orlov’s daring book, The Five Stages of Collapse: Survivors' Toolkit.

      With breathtaking intellectual dexterity and remarkable wit, Orlov provides a broad overview of the first three stages: financial, commercial, and political collapse. Each of these lengthy chapters closes with case studies, which show how to alleviate the worst effects of these breakdowns.

      The man behind the intriguing ClubOrlov blog follows with shorter chapters on social and cultural collapse. These sections also conclude with case studies—about two minorities, the Roma and the Ik tribe of East Africa, who’ve survived through nomadic mobility. They've overcome attempts to obliterate them by relying on their wits and by not trusting those outside their communities.

      The Five Stages of Collapse is a worthy follow-up to Orlov’s previous book, Reinventing Collapse: The Soviet Experience and American Prospects. This breathtakingly original work drew upon lessons from the failure of the U.S.S.R. to forecast what might transpire in the debt-ridden United States.

      In his new book, Orlov includes some good news. In one example, he reveals how Iceland overcame a financial calamity of epic proportions in 2008, thanks to its 1,000-year-old stable democracy. At the time, the Icelandic stock market fell by 90 percent after the three largest banks were unable to repay debts 12 times the country’s gross domestic product.

      The president, Olafur Ragnur Grimsson, vetoed two parliamentary votes to repay depositors in Britain and the Netherlands. And he used his constitutional power to put these issues to a referendum. Voters rejected the bailouts, allowing the banks to be declared insolvent.

      Since then, Orlov notes, there has been great growth in Iceland’s information-technology sector. That came after a great number of mathematicians, engineers, and computer scientists were released into the workforce because they lost their jobs with the banks, which had previously gobbled up many of the country’s most talented workers.

      Orlov reports that Iceland has since repaid emergency loans from the International Monetary Fund; the country’s credit rating has come back; and the economy is growing. The lesson? Let the banks fail in a financial collapse.

      Commercial collapse is a little trickier, he reports. However, Orlov maintains that the consequences of widespread breakdown can be alleviated through promotion of a locally based gift-giving economy, which promotes a spirit of gratitude and conserves resources.

      “Gift economies distribute wealth, resulting in a more egalitarian, and therefore more unified and less conflicted, society, whereas market economies tend to concentrate wealth in fewer and fewer hands until, inevitably, the revolution comes, perhaps bringing with it some guillotines or death squads, and the wealth is expropriated,” he writes.

      Weak governments lose the capacity to regulate or ban certain activities, creating more room for local crime syndicates to expand their operations. He devotes a sizeable section of his book to explain the growth of the Russian Mafia, which has only been curtailed with the revival of a ruthless Russian government under Vladimir Putin’s leadership.

      Political collapse also intrigues Orlov

      One of the books’ most intriguing sections examines political collapse. Orlov points out that the nation-state emerged in Europe in the 19th century and only became dominant across the globe in the 20th century.

      But the rise of globalization has diminished countries’ sovereignty, and a growing number of them are in serious trouble. Somalia, Afghanistan, Congo, Mali, and Syria are technically still nation-states, but their central governments can't project power over their territory.

      The Five Stages of Collapse reports that the World Bank’s list of countries “lacking effective sovereignty” grew from 11 to 26 over a 10-year period ending in 2006. In recent years, Mexico has become an example of a previously stable country that has drifted into chaos and mayhem.

      “How far behind is Greece?” Orlov asks in the book. “Is Spain going to be able to hold on to Catalonia, Galicia and the Basque Country, even as it goes bankrupt? Is Scotland going to remain part of the United Kingdom after the independence referendum of 2014? It is too early to tell whether the increase in nonviable nation-states is linear or exponential, but a simple projection shows that if this trend continues to accelerate at the same rate there will be zero viable nation-states left by 2030 or so.”

      Orlov relies on the work of economist Leopold Kohr to bolster arguments that the greatest cultural developments have occurred in smaller polities, such as the city-states of ancient Greece, or in peaceful confederations of tinier jurisdictions. (In some respects, Vancouver is evolving into a city-state, but that will be a topic of a future article.)

      Of course, the disappearance of central governments also brings a collapse in services and currencies. And this vacuum is often unfortunately filled over the short term, at least, by warlords, according to the author.

      Orlov argues a nation-state is in trouble when it loses its monopoly on the use of force, can no longer able to uphold the law, and is incapable of delivering public services.

      “As the formerly developed nations deteriorate thanks to economic stagnation, aging populations and a host of other problems, the locals are often slow to recognize just how far they have fallen,” he writes. “While they wait for better times to return, immigrants and migrant workers flood in from the formerly developing countries, which are plagued with a host of problems of their own, such as overpopulation, soil erosion and economic disruption caused by rapid climate change, and take whatever jobs are available, be it swabbing out toilets in offices or washing dishes.”

      He adds that the host countries make “half-hearted efforts to integrate the newcomers” by extending social benefits. But these immigrants (and particularly those in the temporary foreign worker category) recognize how transient work has become, and are therefore less committed to the nation-state.

      “The jig isn’t up quite yet, but the trend is already unmistakeable,” Orlov writes ominously.

      Some will be tempted to write off what’s described The Five Stages of Collapse as an utterly implausible scenario in a country as rich and peaceful as Canada. Even so, it’s still a highly entertaining and enlightening examination of the entrails of what happens when societies are driven into the abyss by greedy, hard-hearted elites and corrupt and incompetent politicians.

      And if Orlov turns out to be correct, this book just might end up saving your life by revealing steps you can take to prepare for the worst. Happy Canada Day. 



      Jo. Unrau

      Aug 11, 2013 at 10:28pm

      Unfortunately I believe he's right. Harper is destroying this country & I can't see much better for our future. There are more homeless, more people living in trailer parks & even vehicles who can't afford land & jobs going to immigrant workers & other countries. An acquaintance of ours just went to China for a job because she can't make enough here & our government pensions are threatened. I don't think we will ever have a healthy economy again, at least during our lifetimes.

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