Healy Ann Marie - Resilience: why things bounce back

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Copyright 2012 by Andrew Zolli

All rights reserved, including the right to reproduce this book or portions thereof in any form whatsoever. For information address Free Press Subsidiary Rights Department, 1230 Avenue of the Americas, New York, NY 10020

First Free Press hardcover edition July 2012

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Designed by Ruth Lee-Mui

Library of Congress Cataloging-in-Publication Data

Zolli, Andrew.
Resilience: why things bounce back / Andrew Zolli & Ann Marie Healy.
p. cm.
Includes bibliographical references and index.
1. Fault Tolerance (Engineering) 2. Stability 3. Hysteresis
4. Resilience (Personality Trait) I. Healy, Ann Marie. II. Title.
TA169.Z65 2012
303.4dc23 2011051818

ISBN 978-1-4516-8380-6
ISBN 978-1-4516-8384-4 (ebook)

For Emilia, Benjamin, Nolan, and Evelyn
May yours be a more resilient future

CONTENTS

RESILIENCE

THE
RESILIENCE IMPERATIVE

O n January 31, 2007, the long, narrow alleys and wide boulevards of Mexico City were filled with typical early morning sounds: children running through open doors; families preparing for the day; and street vendors cooking up tortillas, one of Mexicos main food staples.

Yet this was to be no ordinary day. On this day, the price of cornthe main ingredient in tortillaswould hit an all-time high of . With half of all Mexicans living below the poverty line, a sudden increase of this magnitude was not just a nuisance, it was a potential humanitarian and political crisis.

As the sun lifted higher in the sky, the voices of tens of thousands of citizens, farmers, and union activists could be heard gathering in one of the citys central squares. Above their heads, they raised not weapons, . Union leaders and television celebrities railed against corporations for price fixing and chastised the beef and pig ranchers for hoarding their grains.

While the ranchers and political leaders were natural objects of class indignation, they were not, this time at least, the principal culprits. Indeed, the protestors could scarcely have guessed the truth: The slowly burning fuse that had ignited the explosion in corn prices had been lit several years before and a thousand miles away by a seemingly disconnected eventHurricane Katrina.

Heres how: In August 2005, the impending winds of the devastating hurricane had prompted the mass evacuation and shutdown of . This spike in oil prices made cornthe primary ingredient in the alternative fuel ethanollook relatively cheap by comparison and spurred investment in domestic ethanol production. U.S. farmers, among the most efficient and most heavily subsidized in the world, were encouraged to replace their edible corn crops with inedible varieties suitable for ethanol production. By 2007, even Congress had gotten in on the act, mandating a fivefold increase in biofuel productionwith more than 40 percent of it to come from corn.

Amid the euphoria of this ethanol investment bubble, almost no one considered potential impacts on Mexicos peasant farmers, who, in the decade between the passage of NAFTA and the arrival of . Unable to keep upeven with the support of their own domestic subsidiesmany rural Mexican farmers had switched the variety of corn they grew, switched crops altogether, or abandoned their farms, swelling the ranks of Mexico Citys underclass and further accelerating Mexicos position as a primary market for cheap U.S. varieties.

As NAFTA took hold, this expanding corn import market had also become increasingly dominated by a tiny clique of powerful transnational corporations, mostly headquartered in the United States, including Cargill and Archer Daniels Midland, along with of U.S. agricultural productsmuch of it channeled through a tiny constellation of companies.

It was against this backdrop that, in the year that followed Katrina, with increasing amounts of the United States domestic supply being diverted to ethanol, the price of corn became inextricably coupled to the price of oilnot only because ethanol and oil are comparable fuels, but also because it takes an enormous amount of petroleum-derived fertilizers to grow corn in the first place. As the price of a barrel of petroleum fluctuated, the price of a bushel of corn began increasingly to move in lockstep. When global speculation drove the cost of a barrel of oil to nearly $140, the now-linked price of corn also skyrocketed, provoking what may become an archetypal experience of the twenty-first century: a food riot.

. Volatility of all sorts has become the new normal, and its here to stay.

While the details are always different, certain features of these disruptions are remarkably consistent, whether were discussing the recent global financial crisis, the geopolitical outcomes of the war in Iraq, or the surprising consequences of a natural disaster. One hallmark of such events is that they reveal the dependencies between spheres that are more often studied and discussed in isolation from one another. The story of the tortilla riots, for example, makes visible the linkages between the energy system (the oil rigs) the ecological system (Katrina), the agricultural system (the corn harvest), the global trade system (NAFTA), social factors (urbanization and poverty), and the political systems of both Mexico and the United States.

We tell such stories to encourage humility in the face of the incomprehensible complexity, interconnectivity, and volatility of the modern worldone in which upheavals can appear to be triggered by seemingly harmless events, arrive with little warning, and reveal hidden, almost absurd correlations in their wake. Like pulling on an errant string in a garment, which unravels the whole even as it reveals how the elements were previously woven together, we make sense of these stories only in retrospect. Even with a deep understanding of the individual systems involved, we usually find it difficult to untangle the chain of causation at work. And for all of the contributions of the much-ballyhooed Information Age, just having more data doesnt automatically help. After all, if we could actually see each of the individual packets of data pulsing through the Internet, or the complex chemical interactions affecting our climate, could we make sense of them? Could we predict in detail over the long term where those systems are headed or what strange consequences might be unleashed along the way? Even with perfect knowledge, one cant escape the nagging suspicion were ballroom dancing in the middle of a minefield.

So what to do?

If we cannot control the volatile tides of change, we can learn to build better boats. We can designand redesignorganizations, institutions, and systems to better absorb disruption, operate under a wider variety of conditions, and shift more fluidly from one circumstance to the next. To do that, we need to understand the emerging field of resilience.