Atash, why have you chosen to face 2012-2015 in the Seattle area? I love the area but I'm not sure I would want to be there if times were tough and I had to grow food to survive.
I appreciate your concern. In order to answer the question in a way that would make any sense to you, first I need to understand what kind of scenario you have in mind, and what the plan is to avoid it.
Of course none of us can read the future, but people make mental models in their minds regarding what they think it might be like. Some people imagine a crisis to be like a Hollywood disaster movie: intense but short-lived. Of course such things do happen from time to time. As you're probably aware the whole global financial system is broken, and US banks have huge amounts of commercial (and in some cases, residential, which is what brought down Washington Mutual) mortgage debt on their books. Many of the borrowers are behind on their mortgage payments because they have lost tenants who've either gone bankrupt or downsized. This means that the borrowers will have difficulty rolling over their loans when they come due, as commercial mortgages do typically in about 5 years. Unlike residential mortgages, the terms of commercial mortgages don't last until the mortgage is completely paid off, but instead, there is a balloon payment that has to be made at the end of the term, which is typically only about 5 years.
So, unless the central bank (the Federal Reserve) "monetizes" (buys up, using fiat credit) gigantic amounts of debt, huge numbers of small to medium-sized local banks are going to go insolvent. I think they will be allowed to--the point is consolidation of the banking industry into more of an oligopoly. But the debt must still be monetized in order to be resolved one way or another before a bigger bank will buy out the smaller bank which, unless the bad debt is taken off its books, is worth less than nothing.
So either a "banking holiday" (euphemism for federally-mandated closure of the whole banking system--last happened in 1933) or hyperinflation is a possibility. In either case, lack of access to credible money results in a breakdown of a division of labor.
Truck drivers don't deliver goods to stores unless both themselves and their clients are getting paid.
In that case, what would happen? Food riots? Maybe. But they would burn down the grocery stores and loot the shopping malls, not my house. You'd face the same empty store shelves in suburbia, only possibly even worse due to being further down the supply lines.
It would even impact deep-rural areas. Most farmers grow globalized monoculture commodity crops. His wife buys their groceries at Wal*Mart. There is a risk the farmers would expire of starvation over their fields of soybeans they have no idea how to eat and which they don't tend to keep in storage anyway.
But what about long-term economic decline? That's the scenario that people are having difficulty modeling in their heads, even though it's actually the more certain scenario. I can't tell you if there will be a storm in a few days but I know in general terms what the weather will be like 3 months from now compared to today, because the change of seasons overwhelms day-to-day variations. The more monetization of debt, and bailouts, the more destruction of real capital. The lack of real capital is causing some of our remaining productive capacity to shut down. Read this:
www.bi-me.com/main.php?id=47678&t=1&c=37&cg=4&mset=1011One of the big misconceptions about this country's past is the idea of "self-sufficient pioneers". People who have read too many Laura Ingels Wilder books. MOST PIONEERS WERE CHRONICALLY IN DEBT. Typically they bought tools on credit, and ended up owing the merchants who supplied it to buy their wares (their real business was collecting interest) for the rest of their lives. They could not manufacture the tools themselves--that would have required infrastructure that by definition they did not have themselves. They were creating infrastructure, but starting from scratch with subsistence agriculture. Actually, to be completely accurate--they bought most of their food too! They bought commodities such as cornmeal, dried pork, and molasses while building their own productive capacity, and typically supplemented these with whatever was easy-to-produce themselves. Their own product was not so much the production of crops, which took a while to jump-start, but rather, the building up of productive infrastructure itself. It took probably a generation or so to turn truly self-sufficient, so it was not the pioneers who were self-sufficient, at least in terms of being net producers instead of net borrowers and consumers, but rather the children and grandchildren of the ones that avoided bankruptcy.
It is extremely difficult, and mathematically improbable, to increase production faster than interest accumulates. That's why we have periodic recessions and depressions.
Similar to their pioneer ancestors, the average homesteaders don't own anything on their own account; they are significantly in debt. Hyperinflation could certainly fix that! If it happened, which is not a foregone conclusion. My guess is that it will be simultaneous repudiation (so-called "deflation") of some debt, and monetization (inflation) of other debt, depending on to whom the debt is owed and what their political connections are!
In any case, even if they get out from under their debt loads, the average homesteader still can't manufacture his own tools. And, typically, they lack enough credible division of labor to create their own truly "self-sufficient" local economy. That, for lack of of, ah, "vision". Unlike the real pioneers, modern pioneer-wannabes do not have extended families and are generally not part of extended communities such as were the norm years ago, before the "me first" mentality.
I've seen a few exceptions I might post links to later.
In my case my family is unlikely to get caught in a big riot, and as for looting, there are easier targets.
The strategy is to stay solvent in a financial crisis, and to have hedges against inflation and possibly even shortages of product. Solvency is no problem as I have no debt. Inflation has been hedged against. We also have some helpers available aside from the fact that my own immediate family is good-sized and somewhat extended.
As for food shortages, that is the whole point of my seed business. If push comes to shove, we eat some of our inventory. Not that I wasn't already hoarding store-bought reserves from a cash-and-carry warehouse operation. I buy rice, flour, lentils, garbanzo beans, etc, in typically 25 to 50lb bags, depending on the product and how much I use, and I buy multiples of some products which by the way has already been a hedge against inflation.
We should be able to last a year, during which time I can grow more. And Tom and I already have a lot of potatoes still in the field (that need to be harvested and stored, groan). Our productive capacity becomes all the more valuable as other people's breaks down.
To finally come to the answer to your question now that some context has been put around it: my family has numerous ties to the city and in particular my adult and teenaged children are in high-school and college. Consider that people live their whole lives--are born, live a normal lifepsan, and die of old age, in cities like Beirut, which are chronically rather more dangerous than here at least for now. If it comes to it, we can always bug out. The farm is 1.75 hours from home.
Apologies for the long post but I wanted to fully answer your question because I think it is an important one that I take seriously. That's why I am the owner of the mutuallyassuredsurvival.com website--not to mention part-owner of a startup food-crop seed company.
Did you truly come up against someone that ignorant? 