Guest Post: Complexity And Collapse

Tyler Durden's picture

By Charles Hugh Smith from Of Two Minds

Complexity and Collapse

Adding complexity offers a facsimile of "reform" that actually serves the Prime Directive of fiefdoms and cartels: self-preservation.

The most obvious features of recent political and financial "solutions" are their staggering complexity and their failure to fix what's broken. The first leads to the second. Consider the healthcare "reform," thousands of pages of mind-numbing complexity which slathers on thick layers of bureaucratic control on a system which already costs twice as much per capita as competing developed-world systems.

Sadly, the "reform" simply solidifies the Status Quo fiefdoms and cartels that control the U.S. sickcare system.

The healthcare reform fixes nothing, while further burdening the nation with useless complexity and cost. The same can be said of the Dodd-Frank "reforms" of the embezzlement-based U.S. financial system. The original Glass–Steagall Act separating investment banking from depository banking was a few pages in length; by one count, Dodd-Frank requires that regulators create 243 rules, conduct 67 studies, and issue 22 periodic reports.

Meanwhile, back in reality, the Financial Elites of Wall Street and the "too big to fail" banks still have the nation (and Europe) by the throat.

Complexity is itself a tax; the maintenance cost of complexity is high, and can only be justified when the added complexity solves a critical problem of the society as a whole.

Adding ineffectual complexity leads to diminishing returns, as the complexity itself crushes the system supposedly being "improved" or "reformed."

Here is the "problem" which complexity "solves": it protects Savior State fiefdoms and private-sector cartels from losses. State fiefdoms and cartels have one goal: self-preservation. Once sufficient power and wealth (or control of wealth) is concentrated in a fiefdom or cartel (generally the two are partnered, as each supports the other), then the power can be devoted to limiting losses or encroachment.

That becomes the raison d'etre of the agency or enterprise.

Complexity works beautifully as self-preservation, because it actually expands the bureaucratic power of fiefdoms and widens the moat protecting cartels. Once the fiefdom expands to manage all those new rules, only a handful of corporations can possibly afford the regulatory reporting burdens. They are thus free to exploit the populace as an informal cartel.

I addressed some of these issues in The Cycle of Dependency and the Atrophy of Self-Reliance (July 2, 2011).

Put another way: in the competition with the private sector for scarce capital, the State and corruption always win. That's why kleptocracies and banana republics are characterized by bloated, unaccountable State bureaucracies and systemic corruption: sweetheart deals, no-bid contracts, shadow banking, shadow governance by Elites, inefficient workforces that cannot be fired or held accountable, and so on.

Real solutions require radically simplifying ossified, top-heavy, costly systems. Complexity serves to protect the existing constituencies and cartels; it allows those with the most to lose the cover of "reform." But the reform is only a simulacrum; it claims reform along with its expanded powers, but the result is system that is so complex that it loses all accountability. Complexity is the perfect moat.

This is the idea, of course: banana republics and other kleptocracies always manage to support vast State bureaucracies which enable and support private cartel stripmining of the national wealth.

Note that the Status Quo always supports complex "reforms" and dismisses radical simplification as "impractical." What "impractical" means is that various fiefdoms and cartels would lose swag and power, and that would be painful; thus it is verboten.

The single goal is preserving the revenue and reach of concentrated power centers: State fiefdoms with large constituencies and headcounts, and cartels with no competition and stupendous profits. The two are hand in glove.

But complexity does have an eventual cost: collapse. Keep adding decks to the ship and eventually it capsizes and sinks. One the ship is sufficiently top-heavy, all it takes is a small wave.

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redpill's picture

This guy can be a bit blathery, but this one line makes up for it...

"Complexity is itself a tax;"

I wish more people understood that concept.

SheepDog-One's picture

When you have to fill out a pile of paperwork and get govt approval to buy 10 gallons of gas, yea its a big tax.

Ahmeexnal's picture

complex systems are in reality quite simple

Mercury's picture

I dare you to try and get anything significant accomplished through a Massachusetts county land court in under a decade.

AldousHuxley's picture
MUST SEE: Flaws of globalization: A prophetic interview with Sir James Goldsmith in 1994 Pt1


Billion Chinese and Indians are willing to work as slaves for the benefit of top 0.1% corporate executives and shareholders. American and European middle class has no chance unless a revolution happens.

AldousHuxley's picture

Laura Tyson See Start of a `Lost Decade' for Many Americans

She was a spokesperson in favour of GATT, arguing with Sir James Goldsmith on Charlie Rose that American jobs will be increased by the trade agreement. Now that traitor is saying that displaced workers face lost decade.


LAURA TYSON; Candidates for Obama's Inner Circle

BEING CONSIDERED FOR A top economic post, possibly in a return tour as director of the National Economic Council.



A prophetic interview with Sir James Goldsmith in 1994 Pt2

Rodent Freikorps's picture

Yeah. It's called bribery.

Grease for the wheels.

Mec-sick-o's picture

I agree if you are talking about organized complexity and emergence.

Ghordius's picture

Therefore: Flat Tax & Balanced Budgets. So simple.

Talleyrand's picture

How about: No tax & no govt thugs?

SWRichmond's picture

Yes, by trimming words and choosing them more carefully, CHS has crafted an excellent work.  Really well done.  Should be read by all small business owners.

Bindar Dundat's picture

Complexity is to Democracy is to freedom...


The rule is never ever ever eat anything bigger then your head...

Use of Weapons's picture

I gave you a +1, although you're only 50% correct.

Having complexity is indeed an energy tax - for example, having a brain that can process sentience is a large energy tax; huge in fact. However, that large brain allows us to create tools, systems and interpersonal relations that offset this tax and creates a (vastly more) surplus of energy. If this wasn't the case, homo sapiens wouldn't have survived as a species1. In our case the emergent properties of an organised complexity [our minds; actually, probably more social based grammar + language, but that's a much longer thread] (i.e, SENTIENCE) offsets the energy tax of a long period of youth / immaturity [10-13 odd years], helpless babies and the energy demands of the grey matter.

The fact that the GOP doesn't really get this isn't my issue - neither did Ayn Rand. I think the bottom line is that taxes are fine as long as they result in a net increase of surplus. Obviously, they don't always do so - but conversely, they don't always not not provide surplus.


See below for a longer attack on the OP piece - if you want.

  • 1. For now... and no, I'm not getting into Neanderthal DNA, Lizards and Squids tonight
MayIMommaDogFace2theBananaPatch's picture

they don't always not not provide surplus

Triple negative, uh, nice touch...

 Not, not. ;)




snowball777's picture

Those babies just aren't pursuing their own rational self-interest...or Randoids merely use objectivism to rationalize behaving like babies.

GeneMarchbanks's picture

Thank you Captain! Obvious that is.

hedgeless_horseman's picture





Allison Krauss and Yo-Yo Ma


'Tis the gift to be simple,

'tis the gift to be free,

'tis the gift to come down where you ought to be,

And when we find ourselves in the place just right,

It will be in the valley of love and delight.




When true simplicity is gained,

To bow and to bend we shan't be ashamed.

To turn, turn will be our delight,

'Til by turning, turning we come round right


'Tis the gift to be loved and that love to return,

'Tis the gift to be taught and a richer gift to learn,

And when we expect of o-thers what we try to live each day,

Then we'll all live together and we'll all learn to say,




'Tis the gift to have friends and a true friend to be,

'Tis the gift to think of others not to only think of "me",

And when we hear what others really think and really feel,

Then we'll all live together with a love that is real.





JW n FL's picture

Morning Star

Video: Fear Trumps Greed in June Flows


Worth Watching.

Thorlyx's picture

One guy said that fear is the beginning of wisdom. Let's hope....

alexanderstollznow's picture

one thing which certainly isnt complex is the mind of Charles Hugh Smith.

for some reason, he seems to be confusing 'big', or 'tall' (in the case of ships), with 'complex'.

there is no cogent concept of complex in the above piece, and nothing which looks like a logical progression at all.  for example, if 'kleptocracies and banana republics' share, inter-alia, the feature of inefficient workforces which cant be sacked, how is it that America's unemployment rose so quickly over a couple of years, as a result of it being sacked?

Charles, please note, that ships can be very complex without adding more levels until they roll over. 

r101958's picture

Umhhh......the folks being sacked, for the most part, were not government workers......

SheepDog-One's picture

Well just replace a 'tall ship' with a ridiculous Rube Goldberg contraption.

SWRichmond's picture

Obviously you are an amployee and not an employer, and not an accountant.  SMall business owners know exactly what he is talking about.

"This government will operate like an ambuscade." - Patrick Henry, at the Virginia Ratification Debates, 9 June 1788.

An extended wuote:

A number of characters, of the greatest eminence in this country, object to this government for its consolidating tendency. This is not imaginary. It is a formidable reality. If consolidation proves to be as mischievous to this country as it has been to other countries, what will the poor inhabitants of this country do? This government will operate like an ambuscade. It will destroy the state governments, and swallow the liberties of the people, without giving previous notice. If gentlemen are willing to run the hazard, let them run it; but I shall exculpate myself by my opposition and monitory warnings within these walls. But then comes paper money. We are at peace on this subject. Though this is a thing which that mighty federal Convention had no business with, yet I acknowledge that paper money would be the bane of this country. I detest it. Nothing can justify a people in resorting to it but extreme necessity.


Frankie Carbone's picture

Uhh, your wiring is complex. Perhaps someone should check for short circuits. I mean,... what the fuck exactly are you trying to say again?????

EscapeKey's picture

Tainter: The Collapse of Complex Societies

An absolutely brilliant book. Societies collapse because there's no longer an economic reason for them to exist.

cossack55's picture

Follow on read:   Collapse   by Jared Diamond

JPMorgan's picture

I also recommend the documentaries Collapse with Michael Ruppert and Zeitgeist - Moving Forward.

EscapeKey's picture

Zeitgeist MF = communist propaganda. I really didn't like it.

Absinthe Minded's picture

I connected with "Collapse". Michael Ruppert, though a bit dramatic, I believe is on to the real end game. It's oil, plain and simple. We all realize we are critically depending on a finite source. The question about collapse is not if, but when. I pray that my 15 year old daughter will actually be able to drive her own car, and that's only a year and a half away. I've loved cars all my life and it's hard to imagine a life without them. If you haven't seen "Collapse", you owe it to yourself to see it, if just for the insight about everything we use oil for. A very sobering wake up call.

Rhodin's picture

I disagree, not on the importance of oil, but on the idea it is in short supply by scarcity.

The oil price is managed by megabanks somewhat inversely to how they manage the silver price.  (ie. they want as high a price as the market will bear)

  "Peak Oil" propaganda eases the acceptance of the high price, if that fails they will try the "Global Warming"/ carbon tax again or some such scheme.  One way or another they extract higher revenue most of the time.  The price has little relation to the supply, but supply ia also managed, sometimes with troops.   Most info relative to reserves, supply, consumption etc. is controlled by the banks that control the cartel.  When supply escapes their control for awhile (it does) they arrange problems at a refinery or two, or stage a war in oil production territory.   Someday they may lose control, until then they could easily arrange a fake collapse if they thought it would gain them more control, revenue, and/or further the NWO. 

BlackVoid's picture

You are wrong.

If oil was not scarce, the Saudis would not start drilling under the Persian Gulf. Yet they do.

If oil was not scarce, there would be no drilling in the Mexican Gulf. Yet, there is.

I oil was not scarce, there would be no oilsand projects. Yet, there are.


Besides, mainstream propaganda does everything it can to deny / ignore Peak Oil. A sure sign that it is not an agenda, but a real thing.

Rhodin's picture

You are wrong

Perhaps.  I previously agreed with peak oil, and was either wrong then or now!  Since i can't know how much i don't know, and the reliability of most info in this area is suspect, i try to keep an open mind.

If oil was not scarce, the Saudis would not start drilling under the Persian Gulf. Yet they do.

If oil was not scarce, there would be no drilling in the Mexican Gulf. Yet, there is.

I oil was not scarce, there would be no oilsand projects. Yet, there are.

Yes, known ultra cheap to produce oil is scarce, but all of the production mentioned is profitable at current prices.   Considering who is doing the producing, the price will be supported in the face of decreasing demand and/or increasing supply as long as possible. 

The Saudis are obviously less than transparent.  Are they hiding that they are running out (as many believe) in shared fear of loss of oil market control?  Or are they hiding an "off the books" reserve out of fear of invasion and/or oil market crash? 

A acquaintance (fof) spent most of last year checking capped unproduced wells for leaks in the gulf.

Besides, mainstream propaganda does everything it can to deny / ignore Peak Oil. A sure sign that it is not an agenda, but a real thing.

Have you considered that that is precicely the conclusion you are supposed to reach?  You also get to fell superior to MSM in the process which reinforces your belief. Diabolical!



OldTrooper's picture

Zeitgeist is somewhat interesting, as long as you can spot the obvious flaws in their 'final solutions'.

HarryHaller's picture


Tainter's book is like zooming out from our every day life to understand how the zeitgeist of today fits with the history of civilization in its entirety.


1st of 7 part series of a lecture by Tainter that describes the basics of his thesis in the book:


The book is still well worth the time, even if you're just reading the three examples of collapse Tainter covers in detail (Roman, Chacko, & Maya) and the conclusion.

Atomizer's picture

I'll link the video, once at home desktop.

Use of Weapons's picture

Interesting, so thankyou

At 5.26+ he makes the clear distinction between what he considers "not complexity" and "complexity" - organisation + differentiation are both required. He also, earlier in the talk, notes that he's not using the term in the same way that physics or biology does. Well, he is - but he's bastardising it. Which is a shame, as the points he's made so far are somewhat interesting [specialisation as a precursor to modernity is a theme close to many anarchist thinkers].

Other than that, it is a bit painful to watch him mis-use a very rigorously defined concept with his simplified version - grrrr.

HarryHaller's picture

From a layman's perspecitve, I think Tainter's 'bastardization' (for lack of a better term) is an attempt to explain complexity in a way that anthropology hasn't addressed in the past.  Social complexity tends to be discussed as a phenomena and a byproduct of culture in the social sciences, with the processes or agents that create it being distinctly separate.  Tainter argues that what's important isn't so much as to how it comes into being, but how complexity plays an active role - as a strategy that is used by society rather than just a result created by social specialization.

max2205's picture

Buy AMZN and short SPY...till you die

silver surfer's picture

This rant reminds of The State by Anthony de Jasay. He goes into great detail about this subjets. From the minimal state to the totalitarian state.

traderjoe's picture

Allow me to formally object to the new comment rating system: (1) it's more cluttered and harder to get through as many comments; (2) it smacks of a popularity contest; and (3) it slows down the user experience. I used to actually scan the comments first before reading an article - typically great comments and reviews which allowed me to determine whether I should read the entire article.

I've learned a lot from my fellow ZH'ers, and am indebted to TD for the creation and support of such a community. Some of the comments - especially from the ZH greats - were long comments and even tutorials per se. A LOT of information was packed into the comment section - both in form and format.

But the new systems reminds me of Marketwatch - and the fight to see who can get more up arrows than others. It's a system that plays more to pithy quips and jokes, than substantiative commentary.

For my part - not all progress is good. Cheers...

Buckaroo Banzai's picture

One really nice thing about the new commenting system-- it looks a LOT better on smartphones than the old system did.

traderjoe's picture

It's a lot more cluttered on my iPhone 3Gs. And slower to load as well (though TD said somewhere that the load performance should improve over time). 

The boxes, shading, and comments take up too much real estate. And it was easier to hit the junk button than one of the two arrows...

Buckaroo Banzai's picture

Really? I think it looks better on the iPhone. On the old system, comments would get more and more difficult to read the more nested they were. In a big comment thread eventually  it would just look like this:


s is




t tha

t you

are t


g to r


traderjoe's picture

True to that part. I haven't seen an extended conversation on the new system yet, so can't comment. For the regular comments, personally I think it's harder to read - there's less on each 'screen' (i.e. more scrolling). 

saulysw's picture

Should we just add a few replies here and see what happens?

tip e. canoe's picture

if 'anyone' wanted a way to easily quantify the ZHeitgeist, they just got it handed to them on a silver platter.

MayIMommaDogFace2theBananaPatch's picture

It's a system that plays more to pithy quips and jokes, than substantiative commentary.

You're talking about our economic/political system now, right?  Am I right!?!?