Crafting a [Logical] Response to Mounting Power Grabs by Corporations Over Democracy

   (Commentary posted by Roger Erickson)

Regardless of how you feel about faith-based organizations, this is an opportunity to practice "Yes, And" instead of "No, But" on a larger scale ... while also practicing return on coordination.

"A [Reasoned] Response to Corporate Power" webinar series

And if you want to actually build a future worth having, you better also remember where that future comes from, and have faith in feedback from those people as well.

Mark Buchanan — How to cooperate with the future

The message that the simple institution of democratic voting -- IF the outcome of the vote is then effectively enforced on the behavior of all individuals -- can be hugely beneficial for overcoming intergenerational tragedies of the commons. Secondarily, that analyses of what is possible in overcoming these kinds of problems is misleading and naive if conducted in the framework of strictly self-interested agents; pro-social norms in the behavior of real people are a resource for cooperation that we can put to good use.

Translation: Ordinary people in a modern democracy are not sociopaths like their "betters".

The Physics of Finance

How to cooperate with the future
Mark Buchanan

Tony Wikrent — The best of times. The worst of times.

These are the best of times. These are the worst of times. The times we live in give us great hope. And, the times we live in crush what little hope we have.

We have hope, because we know what to do to solve the problems that now threaten our very existence. But we lose hope, because implementing these solutions seems politically impossible. Too few people with too much money would have their financial interests hurt or even destroyed by these solutions, so the media they own obscures the solutions behind false equivalencies, and the politicians they own dismiss the solutions as "too expensive." ...

Our great hope is based on the fact that we basically need to build an entirely new world economy, to replace the old economy that is so heavily dependent on burning fossil fuels. Considering that the entire world economy produces around $71 trillion in goods and services each year (of which the U.S. economy produces around $16 trillion), that means we could easily see double digit rates of economic growth each year, for many, many years. $100 trillion over 15 years is just under $7 trillion a year. That's just a ten percent increase in world output right now! We CAN do this - we have hundreds of millions of people worldwide who would welcome the opportunity of a new, well-paying job that moreover made a significant contribution, in whatever large or small way, to building a better future for their children and grandchildren....

We already have the science, and we already have the technology. What we do not have is a society that values scientists and engineers more than Wall Street speculators and usurers. That will change as the combined triple crises of climate change, resource depletion, and economic degradation under the burdens of usury and speculation, compel us to turn to science and technology to save our very lives. This will be similar to the process described by Thomas Piketty, in which the tragedies of World Wars One and Two destroyed the stranglehold oligarchs in various countries had achieved over their nations' economies. Even now, we are developing the new ideologies that will replace neo-liberalism and conservatism, and change our culture so that doing good is no longer a losing proposition.

The level at which World War Two was actually won, was the level of science and technology, with the deployment of mass produced internal combustion engines, directed radio waves (radar and sonar), computers for code-breaking as well as effective combat fire control, and, finally, the splitting of atoms. The level at which humanity will win its struggle to survive global climate change will again be the level of science and technology, and woe betide the selfish oligarch and financier who stands in the way.

Real Economics
The best of times. The worst of times.
Tony Wikrent

How Best To Prevent An Overly Narrow, Capitalist and "Corporate" Approach To National Policy Development?

   (Commentary posted by Roger Erickson)



While we watch the Davos Dun Masters contemplate how to more gracefully co-opt Democracy worldwide, one can't help but recognize an underlying pattern playing out in every nation pretending to practice democracy.

How many have seen this particular policy example, concerning increasingly concentrated, corporate ownership of crop plant development?

While the details of corporate crop plant development are interesting in their own right, it's simply another example, of the same root process issue seen everywhere. The Davos Dun Masters own a million of them, in every industry known to man.

It is NOT the particular tasks that vex us!

It is our methods for handling an endless stream of tasks that is handicapping us.

Must every market process generated by a supposedly social species, inexorably be owned by a tiny subset of the supposedly "social" animals that create the culture? That, by definition, is an oxymoron, if you know the definition of a "social" species and the benefits that being social bestows.

Please read on. And please focus here on the methods for achieving a social culture, not the particular cause, plus the follow-on, MAINTENANCE methods required to continue benefitting from being a culture capable of generating dynamic markets.

Opposing Monsanto dominance of genetically engineered crop plants?

It's not entirely clear that raising $ to oppose Monsanto is the best selling point, yet the long term methods needed to best prevent the detriments of overly narrow policy development ... now those are worth thinking VERY CAREFULLY about.

In this case, how best might we prevent a narrow, "corporate" approach to crop plant breeding?

First, what is the Desired Outcome here, for any nation?

Suggestion: No matter what good eventually comes from genetic engineering of crop plants, it should NOT be predominantly owned by a narrow set of stakeholders.

Overly narrow stakeholder sets in a democracy? That's just disparity & feudalism under a different guise!

Or, if you prefer, another feeble attempt at Central Planning.

When it comes to comparing capitalism and communism, what is the functional difference? Both feature only slightly different approaches to achieving Central Planning by an oligarchy. Call them crude vs sophisticated approaches to mercantilism. The theory they hide behind matters not. It's the actual implementation that matters to us.

Overly Centralized Planning - no matter how it's achieved - always goes awry precisely because of the failure to adequately sample the required feedback spectrum.

If we want and have a Democracy, just USE it?

There is NEVER any adaptive value in letting social processes by owned by a few. Translation: static wealth disparity cuts required social processes off from necessary social feedback. Therefore, society degrades.

Surely there's a better way?

Who says capitalism is necessarily inimicable to Democracy? 

If my logic, below is correct, then capitalism & democracy needn't comprise an oxymoron. Just don't treat capitalism as the ONLY tool in your social toolkit.

We're back to a very simple point. There is no adaptive path - or transient point of stability - in the natural world, that is not a dynamic equilibrium between multiple, conflicting forces. Or call them conflicting factions, if you're having trouble diversifying valuable analogies fast enough.

What is it that a social species hosting a human culture really wants?

We want to stay on a dynamic, adaptive path. So, we constantly need new methods for chasing that unpredictable path. THAT IS THE ONLY THING THAT KEEPS US ALIVE!

Narrow ownership of something in a given context is meaningless for groups who survive only by successfully migrating through continually changing contexts. Thoreau, among others, warned us of that, long ago.

The most valuable skills to own are our dynamic abilities, namely our abilities to detect every one of our methods that we need to change, and to drive coordinated changes ASAP. As Wallace & Darwin pointed out 150 years ago, our Adaptive Rate is literally our lifeblood. Or, as Shewhart put it, 80 years ago, the highest cost is our cost of coordinating the changes that comprise Adaptive Rate.

The only thing Thoreau, Darwin & Shewhart didn't specify was the obvious corollary.

Since methods drive results, it is our rate of discovering & developing methods that allows us to generate and reap the insanely great returns on coordination. Apparently "T, D & S" assumed that American electorates would be better educated than PT Barnum did. 

Our core dilemma boils down to this. If "T, D & S" were right about our methods for maintaining the quality of the American electorate, then we'll be fine. If PT Barnum was right, then you may as well start looking for another country to migrate to.

Once said that way, it's clear that overly narrow management of static assets are a burden not only to individuals, but a dangerous brake on our national Adaptive Rate - as Thoreau pointed out 170 years ago.

"Most of the luxuries and many of the so-called comforts of life are not only not indispensable, but positive hindrances to the elevation of mankind."   Thoreau

Having access, on-demand, to those luxuries is not the problem. The personal time tied up in hoarding selective access to them is the hindrance. The act of excessive hoarding takes the hoarder out of social play, and compounds that damage by slowing the Adaptive Rate of the aggregate. The result is a skyrocketing Output Gap, due to idling of static assets.

Every tribal society on earth - even our own, tribal ancestors - warned us of this, from the beginning. Our dilemma is that the staggering return on coordination stockpiles static assets. Then it takes time for our dynamic assets to see how to optimally leverage those static assets. That group calculation time is typically grossly extended by the personal hoarding of what are, by default, Central Planners. To hoard is to express Central Planning, which only slows increasingly dynamic use of existing static assets, and hence slows national Adaptive Rate.

So, the struggle between personal and social temptations continues, unabated. Only those cultures able to discriminate the greater benefit of dynamic, social assets survive. There are few, if any, real hermits left, for good reason. They can't compete, except as parasites living off the human social culture they can't comprehend.

Personal hoarding degrades the incredible, group efficiency of pass-through economic methods. Why? Because it degrades & slows our ability to leverage those static assets for pursuit of the most valuable assets of all - our dynamic assets, which allow us to reap the return on coordination.

This is NOT rocket science. Just keep capitalism as one of many accounting metrics, and use them all as checks and balances upon one another. What could be more simple?

That way we can have our supra-tribal population size, our increased diversity, and our pass-through economy too. What's to worry about? That outcome is better than having our cake & eating it too.

A Nation Bouncing Uselessly Between Alternating, "Stolen Narratives"

(Commentary posted by Roger Erickson)

A Nation Bouncing Uselessly Between Alternating, "Stolen Narratives"

FICC, anyone?

The Absolute Disdain For The Middle Class Is Infuriating

(Commentary posted by Roger Erickson)

Take the reporters from Bloomberg, PLEASE!!!

Japan Unveils Record 2014 Budget Draft as Debt Burden Mounts

First they tease you with some sanity.

"Prime Minister Shinzo Abe boosts spending on social security, defense and public works ... "

Sounds great! At least it's some momentum. Once some national fiat builds, it can be reshaped, tuned and redirected as needed. That's always a LOT easier than starting from nothing, and hoping to head in the right direction.

Yet then the bizarre, non-logic kicks in again. Based on twisted semantics. Right in the opening sentence. It's like they're embarrassed to leave a logical sentence untarnished by propaganda!

"... while trying to contain growth in the world's biggest debt burden."

?? Where did that come from? What the heck is going on?

After all this time; who's pushing this "fiat burden" myth THAT HARD? 

It's very much like watching an OCD patient, and trying hard not to stare & embarrass them. Except this nonsensical compulsion is masquerading as OUR national policy!

Is is just an embarrassing compulsion? Or is that obsession occurring by fiat too? 

Either way, this is no way to run national policy. Just stop the stupid behavior, and usher the character actors off stage, graciously, BUT FIRMLY, and ASAP. This is our country we're talking about. Not some psych ward or parlour game. These obsessions are killing citizens and destroying the USA.

Every year, it's more difficult to take these supposed policy obsessions seriously. At various public events, I keep hearing or meeting more & more older government workers (current or ex) in DC who knew all along that it was BS. Enough always knew that taxes are irrelevant to fiat, and that our simple goal with fiat currency is to avoid excessive inflation or deflation, while right-sizing the national fiat currency supply of a population growing in both numbers and economic tempo and complexity. This is not rocket science.

Meanwhile, an obsession with "balancing fiat" continues, and the absolute disdain for the Middle Class which that obsession requires is infuriating to the point of tears. Citizens do not treat citizens this way. It's inhuman, not mention mindlessly stupid. No one seems to know where the obsession originates. That can be discussed separately. The worst social illness is the vast numbers who willingly sell out and go along with the insanity ... for pay, for prestige, for guaranteed income, for perks, for a job, or ... worst of all, just for association with a class of faux-elegant toadies and outright Control Frauds.

WE ARE SENDING THE WRONG PEOPLE TO POLICY OFFICES!

And that, semi-Innocent Fraud runs throughout our electorate. If citizens in any country love their children, they have to stop the collective stupid and start coordinating some Group Intelligence.

As Bloomberg started with, the returns are AWESOME, even insanely great, and easy. Just stop there. Lets just get some awesome going, then keep tuning it to adaptive, not destructive use.

Conflating CURRENT FIAT with FUTURE REAL OPTIONS

(Commentary posted by Roger Erickson - replicated from a comment first posted Dec, 2012 at Seeking Alpha)



Every citizen should learn the rudiments of Situational Awareness by, say, age 10, so that we as a people can keep exploring real national options, not just working at looting one another.

Teamwork. Surely that's not a difficult concept in such a sports-mad country?

Teamwork, like any goal, requires assessment systems, so we can practice before seeing if we can be successful in novel situations. Successful outcomes can always be interpreted in short, medium and long-term metrics. How about these familiar standbys?
.. fiat currency accounting?
.. proportional population employment?
.. survival of the country (based on capabilities & affinity ... of US citizens).

No citizen can assess what they can do for their country if they don't understand the basic operations listed above, starting with fiat currency.

Yes, we already have these measures that could let the public track success, but that doesn't mean that they're used. Largely because most citizens don't learn much about policy tools we already possess. Most of our problems were, in fact, taken care of by the Automatic Stabilizers enacted during the 1930s-1940s (social security, FDIC, unemployment benefits, etc). The only one remaining is Control Fraud (google William K. Black), and that's only because we let crooks talk us into deregulating financial crime, right up to repealing Glass-Steagall.

Everything else comes down to a fight between merchants and citizens, waged through the currency supply, either restricting it to preserve the buying power of hoarded cash, or letting it depreciate to continuously grow liquidity. Let's see how many grasp the following argument.

How do we afford to pay the "fiat interest on fiat bonds."

If carried far enough, that discussion eventually leads to 2 points.

First, we can't fail to pay the interest, since we can always generate as much fiat liquidity units as we want.

So, second, the argument reduces to either:

a) Arbitrarily maintaining the purchasing power of previously hoarded fiat (liquidity units), by progressively depriving an increasingly complex economy of both relative liquidity AND return-on-coordination [i.e., pay the fiat interest by draining private savings of previously issued currency; even though population & net capabilities... are both increasing]. [Even fools don't want that, when faced with a choice. Only pure sociopaths do.]

or

b) Instead, enlarge the fiat currency base [the unit of liquidity] with expanded issuance (public spending), thereby diluting the absolute buying power of yesterday's liquidity units. Why? In order to provide enough liquidity to readily DENOMINATE and hence rapidly explore the expanding options of tomorrow's return-on-coordination. Coordination possible from the pairing of more people with more capabilities.

That is the "SOCIAL-SPECIES DILEMMA." Evolve and stay in the adaptive race, by organizing on a larger scale ... or ... become a has been culture, and become either extinct or a domesticated lunch source for some other, more rapidly adapting species - i.e., one optimizing it's liquidity in order to explore expanding options faster than your culture does.

People who save excessively, i.e., hoard fiat beyond liquidity needs, are hoarding today's output and thereby depriving their grandchildren of expanded options.

Our grandchildren's options are reduced without our full investment in generating those options. Our Output Gap = grandchildren's Options Gap, and the relation is not linear, but exponential.

If our output gap is "j", their options gap is [j(e)], i.e., "j" to some unpredictable exponential "e".

That's how evolution has worked since the dawn of time. We die so that our descendents can be far more than we were. It's called sexual recombination, or cultural recombination, or - in general form - Options Recombination. (see the "Traveling Entrepreneurs Task")

This all follows from the simple, bottom-up dynamics of organized systems.

Walter Shewhart: "In all complex systems, the highest cost, by far, is the cost of coordination."

Obvious corollary: "In all complex systems, the highest RETURN, by far, is the RETURN on [investing in] coordination."

***

SeekingAlpha Commenter Zmartmoney added a key point.

To all who care to notice, you've just explained all our problems in one short treatise. The fact that 90% of the population does not understand any of what you wrote is our heritage - we, as a nation, are now virtually clueless as to how govt, business, or economies work and what role each of us plays in it. This is a testimony to the insidious nature and capabilities of politicians and their success in dragging the discussion into the ditch to drown it quietly while stealing from everyone in sight. The number of statesmen in the Legislative, Judicial, and Executive branches of our govt can be counted on two hands, and we'd probably argue about which ones those are. Our doom is sealed by our inability to grasp why we are here and what solutions, if any, might lead to our recovery to a state of being well informed and capable of making decisions in our personal lives and our govt. Sorry.

We as an informed electorate were not always this ignorant, nor do we need to remain that way. I hope we can someday prove him wrong. To do that, our grandchildren need more options, and they need to be AWARE of them. To provide those options and capabilities, we need to express more initiative (fiat) now, and also select where to apply it - wisely, not randomly.

Media Strategies To Thwart Federal Oversight, And The Rise Of A Control Fraud Industrial Congressional Service Complex

(Commentary posted by Roger Erickson)

Move over MICC, a meaner dog's movin' in. It's purpose? To help the USA better target it's own foot. Indirectly, of course. There's big money in this industry, so it SEEMS better to not ask questions. Besides, if you do stop and think, you won't like what you perceive, and you'll never be happily ignorant again. Don't say you weren't warned.

Would your business like to have a professional Media Strategy to Thwart Federal Oversight? There are companies that specialize in this service ... regardless of the industry sector. Google terms like "Avoiding Federal Oversight" or "Hiding From Regulation" or even "Swaying Public Opinion" - or simply "Lobbying" ... and see what pops up. There are endless techniques for obscuring one's activities in plain sight, and methods for promoting the legality and/or utility of each of those methods. Who specializes in promoting public acceptance of any and all narrow-purpose methods - regardless of the net outcome?

Meet the CFICSC - which "ads" up to a Control Fraud Industrial Congressional Service Complex. Like banking, it's HQ has also traditionally been in NY city, although it keeps notable colonies in places from Hollywood to Miami, and every media outlet in between. That is the industry which is largely responsible for ensuring that justice remains blind ... and distracted too. If confused, divided and conquered sometimes follows - no matter  how often - do they have any responsibility to care? Maybe not as long as Swiss bank accounts remain secret, legal and even publically approved.

Dwight Eisenhower and his warning about the MICC? A piker! For decades before that, Edward Bernays and others had already been advising political parties to get good at propaganda, so that they could operate beneath the bounds of their own public regulations, and be hidden above the law. Of course, Bernays himself always claimed to be "shocked" that such techniques were continuously misused for significant profit extraction dedicated to narrow purposes - including his own income. C'est la Vie. Whaddya gonna do?

Nothing? Or something?

Let's get to the central question. Is unselective, self-manipulation of our own teams - instead of teamwork - really necessary for successful growth of a culture? Narrow competition by any & all system components to manipulate team resources may be a key method of capitalism. Yet a method does not address the ultimate purpose of capitalism, which has never existed in a vacuum. Excessive, uncoordinated pursuit of capitalism's methods absent alignment with evolving group strategies only produces mob behavior rather than organized culture. What would John Calvin and Max Weber think of today's interpretation of Bernay's Sauce as a "Calvinistic" way of further evolving "God's Work?" Clearly, a given method cannot define strategy or purpose. The word "capitalism" cannot adequately define tactics, strategy, goals and desired group outcomes simultaneously. The concepts vary too richly for description by one word.

Yet how do we make it more natural to select adaptively? Oh, just try enough interaction to generate affinity and feedback with all team members? Then see what outcome options pop up? That's what social species do, folks. That's what we do.

There are many who didn't see any adaptive logic when Bernays advised Central Planners to pursue unregulated efforts to manipulate rather than align team members. Yet today, many citizens still remain confused, and use their critical thinking skills only sporadically, if at all. For instance, one has to wonder why so many sports coaches are unthinking capitalists. There's no "I" in team, but apparently a few too many in unexamined capitalism! 

An unregulated collection of gangsters irrationally competing to manipulate one another produces only parasites consuming the decaying remains of their team, community or nation. Such mob outlooks can only produce a whole less than the sum of it's parts. Group success tracks a better way, but it requires a deliberate, informed policy choice.

Please remember that, next time you read an advertisement that targets YOU as nothing more than an irrational component ruled by herd instinct.

“The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country. ...We are governed, our minds are molded, our tastes formed, our ideas suggested, largely by men we have never heard of. This is a logical result of the way in which our democratic society is organized. Vast numbers of human beings must cooperate in this manner if they are to live together as a smoothly functioning society. ...In almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons...who understand the mental processes and social patterns of the masses. It is they who pull the wires which control the public mind.”
Mr. Invisible

How does that pull YOUR mind? As an alternative, there are 30-70 Trillion cells in the average human body, and they are NOT ruled by a few. Rather, their amazing, net agility - you - is a product of all your cells coordinating with all your cells. There is no Central Planner cell, or even a central committee. When agile teams work together, they accomplish truly amazing things. Bernays' version of this sauce has certainly gone rancid. In fact, it was toxic from the beginning. If used in food, Bernays' Sauce would have been outlawed, for failing all Clinical Trial testing.

Perhaps we really do need a more formal Civic Trial proof of concept, for all proposed policy changes randomly suggested by citizens. An Outcomes Impact Statement? Maybe that's how we the people may more quickly SELECT adaptation from cultural-auto-immune social diseases, or self-parasitism. Simply by making the effort to have all of us receive influences from all of us. Surely that is the foundation of an informed electorate?

Instead of attempting the oxymoron of a Centrally Planned mob rule, can the Unseen Affinity of a democracy's Middle Class stay continuously one step ahead of it's own, inevitable, fraud faction, and thereby rule itself more rather than less adaptively?

Only if we inform our electorate well enough to see through the anti-self-regulation advice of Ed Bernays, the Father of Control Fraud Protection Services.

Ya Think? - Faulty Pipes, Why Public Funding - Not Privatization - is the Answer for U.S. Water Systems

Commentary by Roger Erickson

Public self-investment? What a novel concept!!! BMHOTWP!*

Humans never cease to amaze. Hundreds of millions of years after the appearance of "Social" species, we keep RE-discovering the truly amazing fact that there is a RETURN on coordination?

Be still my flowing public infrastructure!

If we can turn on the water, perhaps we can keep turning on the coordination too, without any Libertarians or NeoConnivers noticing, and getting too paranoid?

If this catches on, why, some wisenhower might even suggest a national highway system!!! Or even a Coast Guard? What's next, a DoD and it's attendant host of parasites? If we don't nip this in the bud, there's no telling where this trend might lead, if we only had a functional, group-brain.


* Bang my head on the water pipes (in frustration)

Don't Look Now - But Some Zombies Are Recognizing the Return On Coordination

Commentary by Roger Erickson

This is like a segment from "Night of the Living Duh" movie series, where a fraction of the zombies actually start to mutate, & develop rudimentary cognitive skills. That's right, undead thinking. Given enough time, who knows where this might lead to?

Costliest 1 Percent Of Patients Account For 21 Percent Of U.S. Health Spending

You don't say? So the highest cost is the cost of coordination?

If we don't interrupt their train of thought, they might ... just MIGHT ... realize the obligate corollary. The highest investment return, by far, is the return-on-(investment in) coordination.

You can lead even a species of diverse molecules to be social, but you can't make 'em use their group intelligence? At least not at any impressive Adaptive Rate. 

How long has it been? 3.5 billion years? 

Guess we can wait a bit longer for our current species' train of thought to start loading at the station. There seems to be this National Semantic Debt clock that ISN'T ticking. No wonder our cultural train of thought is conflating "loading at the station" with "getting loaded at the station." Cognitive Prohibition, unwittingly (to say the least) imposed by Merchants?

"Have Growing Team, Won't Use It" Produces "Have Group Fiat, Won't Use It"

Commentary by Roger Erickson

And people ridiculed William Vickrey! He was nearly the only sane one, for decades! Along with Warren Mosler, and JK Galbraith, and Lerner, and Kalecki, etc, etc - not to mention Marriner Eccles. These are all people who knew that economic policy was too important to be left to the economists - orthodox economists who flat out ignore real operations on the ground ... in their own training, education and ideological practice.

What went wrong? What are we still doing wrong?

Logic and awareness of operational reality is clearly never our main impediment. Some people in every aggregate always know what the group needs to attend to. Rather, our #1 problem seems to be stubbornness in refusing to listen to all of ourselves, refusing to acknowledge inter-dependencies outside our personal specialty, and - if we are forced to acknowledge them - calling them irrelevant "externalities" instead.

Can that hurdle be overcome? Of course it can. Homo Sapiens has been meeting and exceeding that task for ~200K years! It just takes preparation, training and constant practice - on a scale larger than anything we've done before. Yet that's what humans do. In fact, it's all we've ever done. Why stop now?  We need everyone to participate in calling everyone's attention to things they actively do NOT want to know, if left in isolation. Our chief hurdle is, at heart, a social recruitment task. Learning to organize on a larger scale, every year, every generation. The only alternative is suicide, and we've supposedly made that illegal. :(

How do we recruit and convince enough of ourselves to maintain an adequate rate of re-sampling the full - and always enlarging - spectrum of changing contexts, so as to maintain awareness of emerging options?

Many historical precedents are available for your evaluation. To avoid prejudicing further discussion any further, I'll mention only two, .

  Keep everyone busy exploring all options. (full employment)

  Provide everyone time to analyze & communicate, not just work. (30 hour work week?)

Our issue is not just "Have Group Fiat, Won't Use It." More accurately, that flaw flows from failure to address a deeper need: "Have Growing Team, Won't Use It."

Here's an example of transitioning from initial statement to a recruiting message.

“The great increase in longevity has produced a surge in the desire to accumulate assets for retirement. It has outpaced the ability of the private sector to produce assets, so we need a larger government debt.” - William Vickrey

Unfortunately, even Vickrey neglects the simple semantics that trip up Jane and Joe Sixpack, and slow their recruitment (~150 million in the USA alone!, and another 150 million students in training - there's no time to waste). He's stuck on initial statement in non-portable jargon.

However, if you replace the above with something like the text below, you have a potentially portable message, that ~150 million adults might follow. PLEASE! Feel free to suggest 1001 different ways to get everyone from 4th graders on down to economists to understand this dynamic systems issue. Whatever rephrasing you suggest, WE'LL NEED THEM ALL! Tomorrow. No, make that TODAY!! By COB. Certainly before COE (collapse of economy).

“The great increase in average lifespan has - initially - produced a surge in the desire of distributed individuals to accumulate personal assets for personal retirement. However, distributed hoarding is not what social species excel at. 

Consequently, the initial, personal desire to ramp up distributed hoarding of static assets has outpaced the ability of distributed populations to both produce and hoard enough static assets.  

It is, however, quite simple - through accumulation of the dynamic asset of teamwork - for a growing population to meet and exceed all the emerging needs of a growing population of children, adults and elderly alike. It's the return on coordination that counts the most. That return is the only thing that exceeds all mounting costs, including the cost of coordination. 

To grow as a nation, we therefore need steadily increasing public investment - aka, "fiat," simply DENOMINATED as fiat currency numerals - to meet the steadily increasing demand for adequate personal income throughout a growing population executing increasingly more, better, faster and leaner economic transactions.
Calling that public investment in ourselves, our children & our later descendants a purely virtual "debt" to ourselves is not just broken semantics, it is useless and counterproductive sophistry."

Balanced Fiat Is A Euphemism For Class Warfare.

In response to the mini-essay on PK's "Moment of Dumb Questioness" one new reader wrote in an email:

"You may want to always provide a explanation which is as simple - but as correct - as possible for why there is essentially no such thing as "deficit" with our fiat economy for the broad population. Then, use that concept to point out why the fiat economy is essential to national well-being. For me such commentaries are strongest when they point out whatever is not perfect. In this case, what (far less important) downside effects occur, and when they occur, as a result of our fiat economy 'printing' it's own currency on-demand."

This is progress. One more down. Minimum of another 15 million US citizens to go! (~10% of adult population)

This reader makes a good point. I will try to always add an opening cue for new audiences. Here's a stab. It may already be thinking too far ahead. If so, please offer your own version of a system primer:

"See Jane. See Dick. See Jane provision the country, using decimal notation for tracking all transaction chains, no matter how complex. See Dick try to run off with all the decimal notation, i.e., the 'fiat.' "

The simple issue is that most of this whole, embarrassing debate results from twisted semantics. A "deficit" formally means less of something than was previously present. Can one have a virtual deficit in a dimensionless, virtual concept - regardless of whether or not you write virtual symbols for those dimensionless concepts in double-entry accounting logs? Of course. It all depends on the semantics chosen for the context being discussed. What happens of people try to mix metaphors across non-overlapping contexts? Then you have sophism. Note that sophism isn't a problem unless a conversation occurs between any combination of the unscrupulous and/or slow witted.

Sophism 300BC: "Is that YOUR dog?" [Yes.] "Is THAT dog a mother?" [Yes.] "Therefore THAT dog is YOUR mother. Ha. Ha." [??]

Sophism 2013 AD: "Does our growing population and economy need more virtual units to track the increasing number of transactions uses this year, vs last  year?" [Yes.]  "So we have a deficit in calculating units to be used this year, vs last year?" [Yes.] "Those charged with making up that 'deficit' therefore have a 'debt'." [Well ... Ok.] "You're a citizen. Therefore, YOU have a debt to pay. Pay up!" [Huh? .. well ... ok. Here. ... Hey! Whaddya mean, I no longer have a job, or pension, or civil rights?]

Endless numbers of anthropologists & historians have explained this ... in countless ways. Even Wallace & Darwin. Here's the gist of the story.

In reality, all adaptive systems are always on a fiat currency system, i.e., no limit to self-bookkeeping. Just use the noise thrown off by the system components currently in operation. Our only internal system restraint is avoiding the confusion of either inflation or deflation. An electorate may pretend otherwise, but it was always just a pretension. Fiat = guaranteed denomination of any & all public initiative. It's just system bookkeeping. Can you imagine any cell-biology system that wasn't resource restrained, voluntarily running out of ATP? That's like a nation which isn't resource constrained running out of hammers - or a blonde running out of signals to breathe in and breathe out. No reason for it to occur ... other than internal disorganization.

Hence, a balanced fiat currency budget means balanced public fiat, which means balanced public initiative? So, what the heck does that mean? It means no NET public initiative this year that exceeds what's clawed back from last year's public initiative? What sense does that make? None whatsoever. Just sophism.

Stop coordinating so we can focus on infighting? The only avenue for local advancement which that policy leaves is class warfare!

Class warfare is just jostling within the ranks - which just brings us back to another definition of inflation vs deflation. Cultural inflation = too little internal adaptive pressure. Cultural deflation = too much internal adaptive pressure. Either can weaken the resiliency of a culture, and voluntarily limit it's adaptive rate.

Once infighting breaks out, guess which "class" of people always promotes balanced fiat? You guessed it. Whomever gets a leg up in any family/clan/class struggle naturally seeks to stick it to their former adversary - and keep 'em down - by under-funding and over-taxing everyone in their erstwhile competitor class. Minimal jostling for position keeps distributed adaptive rate at rates dictated by context. The knack is to know how to not go too far. A culture under-provisioning an entire class of it's own citizens is exactly like a person shooting their own foot, or brain. If you have an asset, it's better to maximally employ it rather than waste it. In any complex system, the highest return - by far - is the return-on-coordination. The alternatives are all different degrees of playing with failure.

USUALLY, these internal-competition cycles are broken only when some worse crisis forces the infighters to instead team up, coordinate, and optimally provision the entire country. Any lack of outside adaptive pressure, however, allows the knuckledraggers to again lobby for Ludditism and "balanced fiat." If that gets out of hand, the whole system usually falls behind some other culture maintaining a higher adaptive rate.

ps: "Balanced Fiat" has become a CFC euphemism for class warfare. Where CFC means "control-fraud correct" .. i.e., endless semantic Sophism

There Are Truly No Enemies

Commentary by Roger Erickson

... only failure to see group options offering orders of magnitude higher stakes.

Can't we all just get along on our way, in pursuit of those colossal returns?

The best way to get more than we can possibly imagine ... is to share what we've got? There's no "I" in team? I'm confused. Didn't we all learn that in kindergarten ... or before?*

Who's been teaching too many of us otherwise? Ayn Rand? You're joking. Whom else?  Seriously. Where the hell is the stupid coming from?

* Ever seen the Amish do a barn raising ... by warning everyone to stay off THEIR property?

Common Understanding Can Protect An Electorate's General Welfare - Only If That Electorate Is Motivated To Select Minimal Actions, Carefully

Commentary by Roger Erickson

John Hemington, long time advocate for the Middle Class, writes with a list of recent articles discussing things that most Americans don't know that they don't know.

Doctrine of Mathematical Impossibilities

Why Obama should pick Yellen to lead the Fed

Government: A much-maligned engine of innovation
  [Brilliant exploration of new ideas in business?]

Bradley Manning, Surveillance State Creep, and

The Next Way: The Emergence of Post-Constitutional America

Yes, John, these are all excellent points that should be discussed far more frequently by a supposedly informed electorate. The absence of these topics from most media underscore lack of thought on underlying public purpose. So here's my initial contribution, to help extend the needed conversation.

Regarding math. A nation's currency system is always created by the people, to denominate all the unpredictable transaction chains it may find need to see citizens execute. Such distributed options and agility flows, always, from policy agility - as a publicly mandated choice. The math only comes after the public purpose.

Yellen vs Summers? Such a choice! Is this a policy fraud hoisted by lobbyists? Why not "none of the above?" Who says there is no other alternative? TINA? Who's Tina? Bernays' publicist, or just another straw woman?

"Government" questioned as a source of innovation? This requires no brilliance whatsoever to discern. Our greatest threat is promotion of a Luddite ideology that denies this simple reality, since government of, for & by the people is both the polar opposite of fascism, and it's natural remedy as well. If we remind ourselves that government is never anything other than us, then it's obvious that teamwork in a social species always generates the highest returns and the most innovation. The best way to explore the return on coordination? Evaluate the options possible through teamwork? That's not rocket science. Just honesty.

On Bradley Manning. Ben Franklin nailed this over 200 years ago. "They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety."  https://en.wikiquote.org/wiki/Benjamin_Franklin

The next way? All the endless rhetoric here is mercifully summed up by Bill Black's reference to Jonathan Swift. "[Fraud is] a greater crime than theft. For .. care and vigilance, with a very common understanding, can protect a man’s goods from thieves, but honestly hath no fence against superior cunning. . . where fraud is permitted or connived at, or hath no law to punish it, the honest dealer is always undone, and the knave gets the advantage." 1726, Jonathan Swift
  [Note that fraud needn't even display superior cunning. It need only proceed unchecked. Keating, Greenspan, Rubin, Summers and Geithner proved that!]

These discussion points all converge to a summary point. Our current criminogenic environment starts as an ill-chosen public policy to reward a few at the expense of the whole. That policy also actively rewards the architects of public looting with further promotions to even higher public policy offices. End that policy, and we end a host of subsequent ills. With even a modicum of discussion, citizens may easily see that a vast amount of daunting activity may be easily replaced by a very few strategic actions, carefully selected to favor Public Purpose over public looting. The benefits of that return-on-coordination outweigh all other temptations, by far. All this is easy, but ONLY if we maintain a bias to carefully selected, minimal action.

IRS Political Over-reach is Nothing New to Many Individuals

Commentary by Roger Erickson

For example, another long-suppressed story has been simmering at the FDIC for years.

Who says Control Fraud ended with the S&L Crisis? It just moved to Goldman Sachs, and then on to the White House & Congress (and by default, to all federal agencies).

Taxing In a Monopoly Fiat Currency Works as Effective Coercion ... To Do What?

Commentary by Roger Erickson

Taxing in a monopoly, fiat currency coerces people to .. be employed? Where? What are the alternatives? Suicide? Revolution? Or, our nation simply needs bigger goals? That's the only positive, and adaptive outlet, and it's always present. Why are we struggling to use that outlet? Simple frictions, from lack of interaction and distributed feedback? We're a victim only of our own distributed confusion and lethargy?  The only thing we have to practice is practice itself?

Return-on-coordination is ALWAYS the highest return, by far. Hence, that culture which is first to put all it's citizens to work - on adaptive goals - will instantly leave all competing cultures in the dust. We just need to imagine goals worthy of all our human resources. What's the alternative? Personal and cultural obesity, functional "diabetes" and accelerated death? BORING. And STIFLING.

Accelerating demand for worthwhile national goals simply cannot be achieved using Central Planning by the 1% - only with improved quality of distributed decision-making and distributed options-exploring. We need the group agility that comes with fiat policy, not just fiat currency. That requires preparation, and planning, and dynamically dispersed interactions, and critical thinking. It requires national practice. Start by giving all your co-citizens lofty goals to achieve, then let us all amaze ourselves with our ingenuity.  Or, you can sit on your ass and hoard "fiat."  Boring.

Hoarding fiat currency is a form, the excess of which defeats it's own function. It's clear that every method is only as useful as it's regulation. We have our fiat, now we have to use it too.  In all it's forms and functions.

Save Coordination Skills, Not Fiat?

Commentary by Roger Erickson

CB Chief Draghi, we've read C.H. Douglas, and euro no C.H. Douglas! :(

However, your recent contemporary, Wynne Godley, Had It Right 20 Years Ago.

Yes, and Marriner Eccles 60 years before that!

Some Fraction of People Always Have Things Figured Out.

Recruiting Faster Than Population Growth is the Real Task. It's called reaching a noticeable Signal-to-Noise-Ratio.

Gerald Grattan McGeer had much of it figured out too. And Abba Lerner & C. H. Douglas, etc, etc. Heck, even Abe Lincoln, Ben Franklin & various American colonial civic groups pre 1750 had it largely figured out. Not to mention John Law.*

That is all interesting trivia. However, where do we go from here. And HOW?

The deeper quid pro quo all need to agree on is that we willingly cede SOME local degrees of individual freedom in return for SOME degrees of group freedom - and reap insane benefits when that investment is wisely selected.** The difficulty is in simultaneously coordinating the selection process, even while populations grow rapidly. We're in a desperate race to organize our own thoughts. Every culture is. Which culture will actually be first to use more than 1% of it's collective group intellect?  This shouldn't be too hard, but we're making it difficult.

It's simple.  Accumulate Coordination Skills, Not Fiat.

Or, to make it even simpler, for Joe & Jane Sixpack:
Save teamwork, not deferred effort?
Save citizens, not gold? (I could say "money," but gold, for now, cuts across all the failed education about money vs currency.)

* (The more one reads of Keynes, on the other hand, the more you wonder about his lack of courage - in sanitizing & summarizing the work of all the above, so as to make it more acceptable to, and hence controllable by, aristocracy. "Lord" Keynes? One can't be a real economist, a free man and a Lord at the same time. I sense the roots of pre-arranged kneeling & surrender every time I read Keynes. The guy strikes me as wishy washy, conflicted and - I'll just say it - a coward. Writing 4 thousand words to skirt one sentence, because it would upset his Lordly peers, and cost him his own peerage.)

** The Return-on-Coordination is always the highest return, by far.

Understanding the Mind Set of People Requesting Tax Deregulation

Commentry by Roger Erickson

Reference Material Useful for Understanding the Context of People Requesting Tax and Financial Deregulation

Why Let Foxes Set Henhouse Security Penalty Fees?

Commentary by Roger Erickson

Witness yet another local feud over asset allocation. This one's between bank-service-providers & merchants. Several items will seem familiar to peasants wielding common sense, students of heterodox economics, and white collar criminologists.

Genesco Lawsuit Could Shake PCI Compliance Regime To Its Core

The argument's over who gets to fine whom? For what, when, for how much, and how frequently? This is always an issue in equitably managing private association "taxes &/or penalties." Rather reminds me of class-based policy for income & other taxes! For sustainability, shouldn't they all co-manage the strategic incentives, not just the immediate tactics?

"The root cause of conflict in this case isn't necessarily about the security standards themselves, but in how the card brands and payment processors choose to inflict financial penalties due to noncompliance and breach events."

"There is a presumption in favor of the payment processor built into the system."   [ya think?]

"The revenue stream generated by these fees is the dirty little secret of the PCI world"

"the revenue model creates a perverse disincentive for processors to push  [a protection-racket model]"

"one of the best outcomes of the Genesco case would be if it would spur the creation of an independent governing body that would assess PCI compliance and the penalties associated with it"

Gosh, maybe we could someday make the Fed, SEC, DoJ & IRS "independent" too? Perhaps even Congress? Wotta concept!! :(

The simple, adaptive systems rule to apply here is adaptive focus. Make policy serve emerging CONTEXT, since solutions to full context always require a whole strategy that is greater than the sum of it's tactical parts. 

It really seems quite simple, and we're more than adequately evolved to solve this. To succeed as a nation, just cooperate on group outcomes? Gee. Isn't that what social species do? Pay the cost-of-coordination, to reap the unimaginable, mind-blowing return-on-coordination. As far as we can tell, nothing has outdone that policy, for ~3.5 Billion years.  Hard to argue with that kind of sustainable success.

But that's just what we're doing. Why? We can't resist the temptation to tax the Golden Goose? Group self control for a growing group is something we achieve ONLY with increasing practice. The only way to profitably handle increasing degrees of freedom is with discipline that co-scales with those degrees of freedom. That's as simple as not trying to pilot a jet or aircraft carrier until you've adequately trained the crew, and even then provide them with enough practice to maintain adequate skill levels.

Ditto for a potentially innovative and inventive work force. Use 'em or lose 'em.

Entries to Douglas B. Rogers "Conditions of a Free Society" Essay Competition

Commentary by Roger Erickson

Conditions of a Free Society

It's laudable for beginning students to discuss such things, yet surely verbal and written versions of that competition should be the method for getting bills presented and passed in Congress?

Lobbyists themselves have overly narrow perspectives, and hence never really know - or are satisfied with - the outcomes from what they ask for.

In a time when experts know more and more about less and less, and end up knowing everything about nothing ... what the hell is the use of convening committee's of "experts" to discuss tuning interdependencies of an increasingly complex system so that they map to better outcomes in constantly changing situations? Our experts have experience tuning return on coordination, since coordination something they know nothing about!!!

You might as well ask a theoretical, orthodox economist with zero predictive power to manage reality.

(Hat tip to Brad Lewis)