Economists used to predict a “soft landing”.  Asset values would adjust gradually and without fuss.  The market would efficiently do its thing, prices would readjust and it wouldn’t be long before the status quo of continued economic growth could continue.  I’m not sure anyone quite believes in soft landings any more, but there may still be some mileage in the aeroplane analogy.

In the absence of a soft landing there is a lot to be said for a crash landing.  In a crash landing people survive, maybe shaken, maybe injured, but alive.  If no-one survives we simply refer to the incident as a crash.  A crash landing indicates that some degree of control was maintained.  The reality of a bad situation was recognised, options were assessed and decisions consciously made.  We hail the pilots of well crashed aeroplanes as heroes for their ability to respond calmly and effectively when faced with a critical situation.

All is not well with the aeroplane which is our economy.  Unsustainable and dangerous faults are presenting themselves.  Too much of the worlds wealth is in the hands of too few people.  Financial systems have been hijacked and are thought to create wealth rather than simply distributing wealth and risk efficiently.  We are consuming and liquidating natural assets, the ultimate basis for all our wealth, far faster than they can regenerate.  Our emissions of green house gases threaten to dislocate the climate causing changes that are unprecedented in our planet’s, let alone our species’, history.  All of these problems have a root cause in the economic paradigm we are still clinging to that economic growth is universally good and will continue forever.  There is not one problem with our aeroplane but many.  We are low on fuel, the wings are on fire, the controls are shot, and nobody has a parachute.

With all these potentially cataclysmic problems becoming apparent we are still working on the assumption that the aeroplane is sound and that the problems will, given time, subside.  The current situation is therefore likened to turbulence which has developed into a thunderstorm; dangerous problems which affect but are external to the aeroplane.  What is not being recognised is the fundamental problems with the aeroplane itself and the best course of action is almost certainly to put down as quickly as safely possible.  All the time we delay recognising that there is a serious problem, our ability to respond and control the decent diminishes.

Crash landing the economy will not be pretty.  The aeroplane that was the growth economy will not fly again, but with skill, courage, and an acceptance of the situation we find ourselves in we may be able to minimise the number and extent of the casualties.  Ignoring the critical failures of our economy guarantees disaster.  A (somewhat) controlled crash landing at least gives us chance.