Friday, August 31, 2012

"Houston, We Have a Distribution Problem! And it's Not Just Currency."

commentary by Roger Erickson

In a comment at Warren Mosler's blog, reader "Save America" finds another useful book, from 1922.

The Story of American Public Life
from 1870 to  1920
SA: "The plutocrats of 1870 (moyers would really like this book)"

That's a good find, by SA. The clarity of thought in Pettigrew's 1922 comments suggest again that most things that need to be said have already been well said. Our problem is getting that key info to key people in key institutions, within critical time periods (say, most students, by 5th grade?).

"Houston, we have a distribution problem!"

The last sentence in the following excerpt from Pettigrew's book is a killer, in his section on "Bryanism":

'It is not easy to characterize a complex political situation in a brief and comprehensive manner. If such a thing can be done at all, I believe that it can be done most successfully through the personality of two men who typify the two extremes of American political life. One of these men that I shall select for the purpose is William Jennings Bryan. The other is Joe Cannon of Illinois. The first is a Democrat—the second a Republican.

I have known both of these men for many years. Neither is a statesman in any sense of the word. Both are lawyers and suffer from the disqualifications that go with the study and practice of the law. Bryan has integrity, of a sort ; Cannon has a keen mind. Both understand the political game, and both play it according to their lights. Bryan plays prohibition politics ; Cannon plays plutocratic politics. Neither has any real grasp of the meaning of the phrase “ the public welfare.” '

This brings us back to that perennial topic of "nothing new, but how do we scale-up what we're doing, this time using 10x more people?" There's no core concept in politics today that wasn't exquisitely solved by brilliant, tribal customs worked out thousand of years ago - if not longer. See this anecdotal post on tribal cooperation. "How can one of us be happy if all the other ones are sad?"  That's a Xhosa tribal saying.  It's a good reminder that even small children can be instilled with the habit of cooperation over competition.

The basic concept is called "return-on-coordination," and is obvious to anyone raised in a tribal or large-family setting. It gets lost when population growth outstrips ability to scale tribal customs.

However, note that return-on-coordination is also not obvious in harsher environments where population density grew more slowly; e.g., Russia.

The Xhosa language & culture is apparently adapted from the San tribes, and it adheres to a very old, small-tribe cultural paradigm.  Nelson Mandela was raised Xhosa.

US citizens have a choice to make. Do we really want to be more like Russians, especially Ayn Rand, or do we want to find faster/better/leaner ways to scale up something closer to what the Xhosa originally espoused?  We want our own way, but we want it to be even better, not just a copy of anyone else.

Our central need is methods for scaling coordination, across group size and different situations. 

How do we scale up coordination?  As an example, it's hard enough to train a basketball team.  How would you train a mega-basketball team of 5000 players on the floor, not 5?  That's the choreography question that military forces have pondered for thousands of years, and the same problem that was arduously solved by every species raising bodies comprised of trillions of well-coordinated, individual cells.  All known tribal cultures have worked out exquisite developmental methods.  Every known successful example required legendary amounts of practice to perfect.  Recent large cultures and nation-states are obviously still in the early stages of practice, working out the kinks. The Pentagon today, considered far ahead of any other military on earth, still struggles with core questions about troop & officer training, unit cohesion, and force agility.

In regional and national policy, we're doing even worse, because we're investing less and practicing less.  The only way for a nation to practice coordination is to keep itself busy doing insanely ambitious things.  What are WE reaching for?

Witness how our republic has degraded into opposing political parties. We're the easily duped victims of divide & conquer strategies played again and again by those enemies of the people called frauds. More - by far - than any other war, whether the War on Terror, War on Poverty, Cold War, War on Drugs, etc, etc, we need a War on Fraud. By not pursuing that war, against the diverse factors limiting our own coordination, we're committing the greatest unwitting act of terror of all - national self-fraud. Self fraud is so subtle that most aren't even aware of the distributed parasite. After all, it's on everyone's back, throughout our culture.

Are we victims of our own, Self-Stockholm Syndrome? Each of us feels trapped, surrounded by neighbors where everyone is out for themselves, forgoing public initiative in order to hoard fiat currency "for later use." Since fiat currency is backed by public initiative, hoarding fiat currency equates to putting off public initiative. Yet there's no return on forgoing initiative! That's a zero sum game! Nevertheless, when everyone is doing it, it's tempting to go along with the "small" approach to organization. We've been duped, and it's shameful.

Yet we have a group mind of 312million (~150 million "adults"?) that can only think big, or not at all. A group-mind is a terrible thing to waste. What methods would allow us to link more people, so we can achieve the insanely great return on coordination from our entire population?

Investing in those new methods is far more important than the comedy of trying to hoard fiat.

"Houston, we have a problem, but we can handle it."


Anonymous said...

It gets lost when population growth outstrips ability to scale tribal customs.

Erickson, I used to have many talks with archaeology and sociology profs. We concluded that once you scaled beyond small usufruct societies, everything collapses. Human beings memory systems are only good for a few thousand faces, IE TRUST and local knowledge of a few thousand human beings, so once villages started getting above a few thousand humans, you start introducing all the problems of no longer trusting real people, but the systems and currency and laws etc. One sociologist said it would best to divide the world population into cities of only a few thousand. The local knowledge would be best match to our human brains ability to deal with only a few thousand other humans directly.

At the end you talk about group mind, but 500 million people with only a 140 IQ will not beat 1 garry kasparov or DEEP BLUE computer that can see 40 moves in advance, more people of same mental ability does not make for a better chess game.

Tom Hickey said...

@ Anonymous

Right. Aggregating humanity into big boxes in mega-cities is like taking animals from their natural environment and putting them in a zoo with keepers to "care for" them as though they can't care for themselves naturally.

Libertarians of the left realize this and are "anarcho-communitarians." "Anarchy" means no rule from above but rather rule by consensus among peers. Community means making decisions that affect the group locally and consensually.

Tom Hickey said...

Here a link to a digital copy of Triumphant Plutocracy.

Tom Hickey said...

Ayn Rand v. Xhosa reflects opposite extremes of brain functioning wrt to mirror neurons and empathy. But in addition to nature, there is also nurture. I don't have the link at the tip of my typing fingers, but I was reading about a study recently showing that taking economics courses decreases empathy.

The extremes of brain function in Western political thought are anarcho-capitalism and anarcho-communitarianism.

Tom Hickey said...

More - by far - than any other war, whether the War on Terror, War on Poverty, Cold War, War on Drugs, etc, etc, we need a War on Fraud.

We need a war on wars.

The root-cause of the chaos which precipitates itself in wars is that most persons are in the grip of egoism and selfish considerations, and they express their egoism and self-interest individually as well as collectively.

Ultimate cause of chaos is in egoism and self-interest

This is the life of illusory values in which men are caught. To face the Truth is to realise that life is one, in and through its manifold manifestations. To have this understanding is to forget the limiting self in the realisation of the unity of life.

Wars unnecessary and unreasonable

With the dawn of true understanding the problem of wars would immediately disappear. Wars have to be so clearly seen as both unnecessary and unreasonable that the immediate problem would not be how to stop wars but to wage them spiritually against the attitude of mind responsible for such a cruel and painful state of things.

In the light of the Truth of the unity of all life, co-operative and harmonious action becomes natural and inevitable. Hence, the chief task before those who are deeply concerned with the rebuilding of humanity, is to do their utmost to dispel the spiritual ignorance which envelops humanity.

Meher Baba, Discourses, 6th ed, v. 1, p. 18

BTW, according to Sufism, "Wars have to be so clearly seen as both unnecessary and unreasonable that the immediate problem would not be how to stop wars but to wage them spiritually against the attitude of mind responsible for such a cruel and painful state of things," is the spiritual meaning of Arabic term "jihad." It is personal and internal, doing battle with one's own "demons" of egocentricity. It is fought not with repression but with love, for love is the great unifier in that it is the spiritual apprehension of the unity of existence as spiritual truth. The present day jihadis have perverted this meaning.

The coordination issue is at bottom a problem having to do with the level of collective consciousness.

Roger Erickson said...

Good starting comments above, but our tasks aren't anything that hasn't been solved before.

Prokaryotes couldn't figure out how to scale up more genes/proteins while using proteins to regulate the genes that made them (it's like not being able to put enough cop cars on the road to keep more & more cars from speeding.) Self-regulation-with-self can’t scale – you need shortcuts to scale regulation.

Similarly, unicellular animals couldn't easily scale up multi-cellular physiologies w/o novel communication instrumentation.

Solution? For every insurmountable task, there is a solution, and that solution will involve another level of indirection.

Example: Eukaryotes invented siRNA as an order of magnitude more efficient way to regulate genes with tiny slivers of RNA. Basically, it's an accurate indexing system, which works because a few tolerance levels on key processes were tightened up. Hence, eukaryotes could scale up massively more complex cells than prokaryotes, which in turn allowed massively more multi-cellular physiologies.

Virtual communications like language did the same thing for various social species - allowing them to scale up new levels of indirection, by increasing their population. No matter what we do, our options scale faster than we do (The Traveling Entrepreneur Task ).

We have to do something indirect to scale much beyond where we are now.

Email? Twitter? G+ All these are potential tools, but it will take considerable practice, and the tightening of tolerance levels on some key processes (e.g., how well trained & practiced citizens are?) to find an optimal combo of new tools & new practices.

In politics, what seems more attractive is to keep Congress & states as is, and delegate more decision-making to the existing local county councils, city councils and mayors.
[Not to mention more training of politicians, and demands on their performance. See Outcomes Based Training - ]

We have more than enough politicians. What we need is more practice & experiments in distributing decision-making throughout existing delegates.

If we start adding layers of bureaucracy, it should be bottom up, below the level of existing counties.

AND … whatever we do, it has to also involve BOTH more de-centralization of decision making (delegation) and improved quality [and pace] of distributed decision-making.

jrbarch said...

When you look at a human being; see a human being!

We don't know how to do that any more.

Best analogy I have ever heard:

Your car has a flat on a hill. You discover the handbrake isn't working; the gearbox often jumps out of gear. Your baby is in the back. There is no way you can leave the car to chock the wheels. Now, would you grab the baby, lean out and chock the wheels with your baby?

And yet, that is what we do, every day.

The cause is greater than the human life, and this is delusion.

It's not the fact that it is a baby; it is the fact that it is a human life; human existence in some form, whether nine months or ninety.

The value of a human life has been lost: it is not understood, it is not appreciated or celebrated anymore; it is no longer seen as far more precious than even mundane metals or shiny pressurised carbon; than the kingdom itself. It is no longer a miracle! How can you consciously steer an aggregate such as a nation state or city (which has no sentient existence), if you lose sight of the human being?

Remember those old stories where the King was 'good' and the people 'happy'. Peace settled over the land. The value of a human being was the root watered and the leaves and the flowers and the fruit followed after. Human dignity first, then peace, then prosperity!!!!!

Do you know what has never been tried in organising the aggregate?

Yuu Kim said...

"the value of a human life..."

profound comment, jrbarch!! as i write this, tears are streaming down my cheek. you hit the nail right on the head!!

the devaluation of human life is the primary cause of human suffering. and that devaluation itself could be caused by the process that anon describes in comment no. 1 above.

i love this blog. i've learnt so much here. thanks be to you, mike n., tom h., roger e. and to all the commenters... i thank even the trolls (i say that hesitantly), b/c they bring all the best arguments out of you guys...

keep it coming!

Yuu Kim said...

about comment no. 1...

what you say makes perfect sense, anon, but i think maybe it's a bit too late in the game to put the genie in bottle and go back to small societies.

i think globalism is here to stay and i think we need a few very knowledgeable and very wise men (and women) to embark on a different path, that being, to construct a global society based on peace and cooperation.

dunno where these wise people are gonna come from though...

Tom Hickey said...

Yuu Kim, society is already largely decentralized where it counts. The people running things are just getting in the way of the people actually doing things. If we don't end that tendency toward centralization and consolidation of power, we are all toast. They are an overall liability for the world rather than the asset they make themselves out to be and pay themselves handsomely for.

We need a Martin Luther of world politics. One man broke the power of Christendom in the late Middle Ages as the Renaissance was dawning. We need the same now to break the power of the new high priesthood and its hierarchy of minions.

Roger Erickson said...

"Yuu Kim, society is already largely decentralized where it counts. The people running things are just getting in the way of the people actually doing things."

Bingo, Tom. We're in a never-ending race to de-centralize decision-making fast enough. Can't take too many chances ... 'cuz one of these times we'll just fail, and be replaced by someone or something that doesn't.

Leverage said...

Tom and Roger, how do you consolidate this with the current institutional arrangement where money creation is highly centralized and dependant on banksters and politicians/gob officials?

If anything is true the phenomenon you are describing is already happening (or happened in the past), these morons are self-collapsing the system thanks to the centralization of decision making.

What do you suggest? We should have a clear set of rules and let the system run on automatic (basically substitute moron technocrats by a computer, like Friedman suggested)? (ie. fixed interest rates, accommodate all bank reserves and run government automatic stabilizers whenever is necessary?).

Tom Hickey said...

Leverage, it is not possible to say what direction this will take wrt money creation. We are already seeing experiments with "digital currencies" like Bitcoin and also local currencies that sprouting up where there is a lack of official money.

Moreover, there is a push on to rethink the international monetary system for trade to put it on a firmer basis. Where that will go ultimately is anyone's guess, but I doubt it will be back to a gold standard.

I don't see a problem with centralization where it is appropriate, such as international law, international courts, and the like, as well as the UN as an over-arching institution with appropriate powers.

I have no issue with national government exercising appropriate powers also, like the rule of law when it necessarily applies to the whole legal system of a country.

But I am a firm believer in subsidiarity, which holds that decision-making should be as close to those affected as practicable.

Ultimately these are political decisions to be made by free peoples, where there are ranges of views, such as conservative and liberal, authoritarian and libertarian. Instead of one group trying to impose its views on others, we need to proceed by compromise if we don't want to generate eventual conflict.

To make this work well, there should also be open borders for all, not just the wealthy. Then people could get with their own kind. But here, there would have to be a overarching set of rules and enforcement mechanism to prevent overt conflict until people are mature enough to handle freedom responsibly.

As far as the economy goes, flexible rules can be put in place in order to accomodate changing phenomena like saving desire and the required amount of money to offset. But for a system to work smoothly there has to be relative equality, which means the elimination of rent and rent-seeking.

I don't see any of these issues as insurmountable obstacles, other than overcoming the vested interests involved. But theoretically it seems quite doable to institute participatory democracy with the present level of technology. This would go a long way to facilitating the development of appropriate social, political, and economic institutions. After all, it's just changing the rules we choose to live by, with the limit being available resources for creating ideal society.

Roger Erickson said...

this is pretty well summed up in comments from the USMC, on the need to improve the quality and tempo of distributed decision-making, and producing tempo by the very act of de-centralizing decision-making.

The rest is implicit. De-centralize the freedom to make delegated decisions. Patton, Boltzmann & Darwin would all seem to agree upon this.


The more people we have, the faster we have to further de-centralize decision-making, and the information exchange that allows decisions to be context-relevant.

From a systems point of view, it's pretty simple. Methods for re-instrumenting any given, growing system to actually effectively de-centralize as fast as it grows ... that requires a lot of trial & error.

The glory (& survival) really will go to that culture that actually does find better methods.