More Semantic Confusion. What's "Good" for U-Michigan Is "Good" For The State Of Michigan?

(Commentary posted by Roger Erickson.)

"Michigan, where paying Jim Harbaugh $40 million may sound obscene but, in fact, is a very sound investment."

For whom? For the general welfare of the people of Michigan? Can't such authors finish a conjecture, by placing it into a context? Haven't they heard that data is meaningless without context?

To his credit, the author does include this immortally inane quote summarizing a quite common athlete's view of education.

“Why should we go to class if we came here to play FOOTBALL,” he tweeted ... “We ain’t come to play SCHOOL, classes are POINTLESS.”

Then there's the following paean to reality.

The untold part of the story is this: For every program like Michigan, which can easily afford to pay a coach millions, there are at least four times as many schools trying to compete at the top level of NCAA football that are drowning in red ink. There are 128 schools playing at the Football Bowl Subdivision level. Perhaps half of the 65 in the power conferences are making millions each year. The rest break even — or worse. 

The University of Maryland recently had to eliminate seven nonrevenue sports because it had so much debt — created by overspending on football. That debt also caused Maryland to bolt from the Atlantic Coast Conference after 60 years to join the potentially more lucrative (because of a better TV contract) Big Ten.

Had to? A pronouncement from Empress TINA no doubt. While he's getting on the right track by now, the author doesn't even bother to mention the social impact of all the U-Michigan students now saddled with socially constraining student loan debts.

If we can afford to spend significant chunks of our disposable income watching illiterate people run and jump like cavemen, why the heck can't we just provide ourselves with enough extra income to pursue more innovative interests as well?

Managing - or balancing - fiat is meaningless without aggregate adaptation to context. Does that help?

If you have to ask what public fiat is, please consult your own dictionary, before opening y'erble mouth.

Semantics or Sophistry In Policy Discussions and Economics. Which Do We Want? Our Selections Shape Our Success.

   (Commentary posted by Roger Erickson)

Don't know the difference between fiat, denomination units, currency, Public Initiative, semantics and sophistry?

Then read this and give it a 'tink:

Issuing sovereign currency gov Treasury securities [eg US, Japan] just allows the non-government to have net financial savings. That maintains a buffer stock of currency in private hands.

So what is the problem?

Why on earth do even MMT economists stoop to calling distributed holdings of denomination units a deficit or debt? That's unproductive use of semantics. It constitutes sophistry.

Better can we do, counsels YodaCredChief, Fedi Master. :)

To expose the semantics, just hold up the 1921 Edison/Ford statement on equivalence of bonds/bills.

I've had fiscal policy discussions with military operations people about the state of economics. They listened, said they understood, and simply replied:

“You’re going nowhere until you create a glossary of new terms allowing coherent discussion to proceed. You can’t prepare coherent operations when there is such high margin of error in interpreting statements.”

So do we want to figure out how to drive the changes we need in order to keep up our adaptive rate? Or do we just want to get people to accept no change?

Soph·ist·ry: noun,
   modern use, the use of fallacious arguments, especially with the intention of deceiving.

Has anything regarding the principles of finance & sophistry really changed?

Hillary Clinton Says Deficit [In Fiat] Sends Message Of Weakness

   (Commentary posted by Roger Erickson)

Hillary Clinton says deficit [in fiat] sends message of weakness

That was a year ago, and she is still confused. What weakness was she actually referring to?

Semantic weakness, perhaps? Plus a weakness in her mind, & her will to use it?

That's pretty embarrassing.

Ben Franklin must be turning over in his grave, and weeping in shame for his country. Almost 300 years, and we are STILL largely ignorant about something as simple as a currency system.

And seemingly getting even more ignorant.

Innocent, Active And Accidental Semantics

   (Commentary posted by Roger Erickson)

How Language Is Used to Deceive You: Politics, Business, World Events, Sports, and Law (1989)

We need another word in our language, to drive home the impact of semantics and self-parasitism, on our Aggregate OODA loop:

aggregate observations,
perceptions and paradigms,
policy orientation,
consensus and distributed decision-making, and
assessments of local and aggregate actions.

"Auto-immune" is well known.

Aggregate-self-parasitism should be just as well known as self-fraud, or even fraud.

This book is about the range of habits & tools used by the diversity of social parasites, working in diverse trades .... applied to the realm of human language.

Any suggestions?

An Athlete That In Theory Had Eaten His Fill And Bet His Life That He Could Outrun A Bear

   (Commentary posted by Roger Erickson)



Capex growth to slow

A complication occurred for this "athlete." The belly sequestered all the nutrients, and the legs are screaming & cramping in the 1st 100 yards.

"Structural" adjustments in the legs isn't gonna do squat.

[or rather, using the same word, with different semantics ... anything else but! :) ]

Proper, preventive, training & diet matters, and produces more adaptive resource distributions. We all hope there's another chance to learn that lesson. Praying that the bear catches some other idiot first isn't a reliable survival strategy.

This athlete needs MORE, not fewer, automatic stabilizers. Especially at the policy end. No tool helps much, if it's use isn't practiced, BEFORE it's needed. Even less if it's not even used.

There's many a fail 'twixt the theory & the outcome?

Might wanna pay a bit more attention to the actual operations, regardless of the theory?

Video: "Christian Debate?" About the Morality of Nominal Sophistry

(Commentary by Roger Erickson)

Data is meaningless without context. So before viewing the video below, please consider it's context, and the parameters which allow us to assess REAL vs only nominal success in a given context.

Many have heard of the origins of the phenomenon named "sophistry" by the Greeks.

2300 years ago, Greeks noting and naming the structure of language, immediately also noticed the fluidity and gradual change of what they named grammar, vocabulary, semantics and sophistry.

Semantic plasticity - the function of letting the same word imply different things in different contexts or usage patterns - allows a relatively small number of words to describe an unlimited set of concepts, when specified by context, word order, or many other linguistic tools (prefixes, suffixes, and noun/verb/other variants).

Sophistry was one, early form of humor noted, used and abused by various people. It use is described in the dialogues of Socrates.

"Is that YOUR dog?" 'Yes.'
"And is YOUR dog a mother?" 'Yes, she has puppies.'
"Then that dog is YOUR mother!" :)     Socrates noted two general classes of responses.
      Intelligent people: '[Greek equivalent of "bug off."]'
      Naive youth: "Oh my gosh. My dog is my mother!" Fear. Panic.

This brings up a moral dilemma. Or does it?

Maybe not in the same way for all people. The early sophists were soon reviled, for their irritating habit of practicing and refining ancient methods for confusing, dividing and 'conquering' naive targets, so that they could be more easily tricking into being the object of ridicule. Worse, sophists were soon followed by others who refined their methods of cheating at wagers, or even robbing people. Sophistry has long been associated with subterfuge, propaganda, and looting.

So, is it immoral for a person to have a dog as "their" mother? What if they own multiple dogs with puppies? How immoral is it to have multiple mothers, and that they are all dogs? :(

Or is this all a lot of data, and semantic descriptors, uselessly applied completely out of context, and therefore contravening a basic, hierarchical rule of language utilization ... i.e., that it be applied to orient to REAL, not just imaginary, nominal or nonexistent scenarios?


Let's take another example.

"Is that YOUR fiat currency?" 'Yes.'
"And in purely nominal, double-entry accounting ... fiat currency creation has to be balanced with an equal entry labeled, purely for form, a 'deficit' or 'debt?' " 'Yes.'
"Then that nominal metric is YOUR real debt!" :)

Just like with Socrates, we're seeing two general classes of responses.
   Intelligent people: '[Get lost.]'
   Naive people unaware of basic banking operations: "Oh my gosh! Our nation is in DEBT!!!' Fear. Panic

Is it only nominally immoral for a population to have a purely semantic 'debt' to itself? What if that population grows AND the transaction rate of each resident increases! Is it immoral to allow increasing use of nominal or fiat measuring units for our growing populace to denominate necessary transactions with - i.e., an increasing volume of fiat currency?

Or is the only functional immorality that of an electorate leaving itself unaware of basic operations, unable to discriminate sophistry from functional semantics, and flat out unaware of actual context?

Now, please watch this video and the 2nd link, to see how it is promoted. Then please comment below.

"Christian" Debate About the Morality of Nominal Sophistry

Government Debt is 'Idolatry,' Hurts the Poor, Future Generations, Christian Panelists Argue

The immediate issue here is confusion over the dual roles of any currency system, and conflating two separate needs.

1) denominating any and all, unpredictably needed transactions, WHENEVER they need to be denominated (tempo is paramount for group agility)

2) short term vs long term stable store of value. (Value is ultimately dictated by context, not by denominating units.)

The deeper issue is basic need to maintain situational awareness, as the threshold for survival of a functioning democracy.

Since tempo is critically important, we really need to address our electorate's situational awareness, ASAP - before we're robbed again, or confused and divided enough to be conquered? What else could be more important for National Security?

It's A Pity That The Entire DNC Fails To Realize That One Of Their Stated Goals Precludes All The Other Ones!

  (commentary posted by Roger Erickson)

They need help finding a graceful path to occupying more consistent logic, not just fervor. Fervor is a necessary start, but it's not sufficient. Conflicted logic precludes return-on-coordination?

Do you have additional suggestions for encouraging well meaning people to dig into actual currency operations, not just superficial semantics?

Apparently Marriner Eccles and Beardsley Ruml weren't enough, not to mention Warren Mosler, or Bill Mitchell or Randy Wray or Stephanie Kelton.

This could be critical step in educating tens of millions of citizens, so please be very careful and very encouraging when responding to the originator of this twitter poster.

Vote Democrat ... to support this agenda ..? or help them update it?

The Distribution of Federal Spending and Taxes in 2006 (and semantics too)

(Commentary by Roger Erickson)

This CBO report is already dated. Has distribution of taxes changed much YET?

ps: there's lots of interesting date here. Something for almost everyone.

Example:

"The largest component of unallocated revenues is remittances to the Treasury from the Federal Reserve System."

Curious. :) Yet there's much more. Just haven't the energy today.

After reading that, I'm visualizing 7 layers of inmate committees, in the inmate bureaucracy running this asylum. :)

There's a LONG way to go. Every person in our current bureaucracy is confused by their own, collective body of outdated semantics. Meanwhile, whole lobbies are dedicated specifically to promoting and prolonging each of the many, independent streams of babble.

It's a semantic trap. Nay, semantic quicksand.

Not even! The Semantic La Brea Tar Pits! (Where future archaeologists will find the extinct, SoberKrug Catatonics, fatally mired in ISLMist layers. Let's hope our whole population doesn't follow the SoberKrug species of Catatonics down that path to stagnant equilibrium. More adaptive paths beckon - if we're agile enough about adapting continuously, rather than arbitrarily equilibrating to ISLMist stasis.)

Our Fiscal Policy staff desperately need a Fiscal Semantics Standards Group .... to work on regaining the capacity for coherent discussion across bureaucracies.

Rumor is that there almost was one, once. It was scheduled to start the day after the Tower of Babel fell down. :)

Shooting Ourselves In The Semantics

   (Commentary posted by Roger Erickson.)



I cringe every single time I hear people vehemently arguing over whether our public deficit is good or bad.

At the start of debate, wouldn't it help to at least jointly define the terms being used?

The present debate is useless for our 315 million citizens, precisely because there are too many examples of self-defeating Semantics displayed, in front of too many diverse audiences, all used to their local and discipline-specific jargons.

We can never catch up in the task of recruiting enough of our 315 million (and growing) people - in thousands of distinct and diverging sub-audiences - to adequate situational awareness ... until we AT LEAST cease, forever, calling self-investment a "deficit" in fiat.

What the hell does a deficit in fiat even mean? (And yes, policy arguments are full of other examples of broken semantics. This isn't the only one.) Best I can come up with is that it means a deficit in Public Initiative. We can digress from that point, but in doing so we may as well discuss how many pinheads can dance on an angel.

Meanwhile, this is rather like converting Priests to be atheists, by constantly telling them there is no God, there is no Devil, there is no Heaven, and that they won't go to Hell.

At the end of the day, all you've done is reinforce the exact, limiting concepts you want them to get past, and free themselves from.

Semantics and propaganda: Every word you utter INSTANTLY triggers an emotional impact in audience members, long BEFORE the concept delivered by the full sentence is even partially, let alone fully parsed, eventually, after some subsequent thought (aka, extended neural processing). There are diverse circuit latencies in the human brain. Their latencies range from fast, for ancient, underlying, hardwired circuits, to slow, for those conveying associative learning, including indirect pattern recognition - the kind it takes to traverse unpredictably changing contexts. Live with it, or see your group dynamics fail.

Broken semantics is like running in quicksand. It's self-defeating. Long before the neocortex engages to consider new concepts, you may have - by sloppy word selection - mobilized the brainstem emotional circuits to fully oppose the logical explorations you ostensibly desire.

That condition is the simple price we pay for having a lean vocabulary and language structure that lowers our adaptive burden by easily adjusting word meanings for altered contexts. Call it slang, jargon or whatever you want. The words we use ALWAYS have context-specific connotations that change as fast as local contexts do, and we ALWAYS have different people steeped in different, local contexts which dominate their instant perceived implications of words and phrases which are not yet logically interpreted as a complete sentence - or more. That's the basis of oratory, semantics, politics, sophistry and propaganda.

What part of shooting ourselves in the semantics don't we understand?

If you want people to explore new options sooner, quit referring to the old impediments in the very words you use for the new recommendation! Refer ONLY to the new, CONSENSUS Desired Options that embrace and extend all local contexts, so that people can engage their brains WITHOUT actively recruited prejudices in the form of past baggage.

If carefully practiced, appealing to some form of "a more perfect union" usually does the trick, since the return-on-coordination it triggers always swamps all other returns. Yet people appreciate that ONLY if your semantics and wording doesn't recruit their old gut reactions to oppose the purely local costs they'll think of. The difference between triggering a cooperative "win-win" versus a hyper-competitive "lose-lose" response in different audiences is entirely dependent upon how carefully you choose your words to entice them all WITHOUT triggering their social auto-immune responses.

If you're are NOT careful, you can easily end up triggering a Cultural_Auto_Immune_Social_Disease.

When herding cats ... or humans, it helps to know your audience. How difficult it is to entice a given audience depends on how much practice they've recently had at coordination, and at benefiting from it.

If you start talking to Russians right off the bat about the benefits of cooperating ... it's a lost cause. That is NOT in their recent, cultural DNA.

Similarly, if you start talking to Jane and Joe Sixpack in the USA, and open with something about increasing the deficit ... you've already shot the conversation in the semantics. You'd make faster progress by trashing moms, apple pie, pick-up trucks and country music before asking for cooperation. Don't expect a warm welcome with either approach.

How's this for a pick-up line?

Hey, Bay_bee, yer mom's apple pie stinks - & yer dad's truck too!
                    How 'bout a date? :(

Yeah, that might work for some rebels, but do you really want to limit your message to that audience alone?

Depends on whether you just want to be RIGHT, or actually make your country successful.

Increased Public Self-Investment Triggers Uncertainty & Reluctance To Invest, For Fear Of Higher Taxes? Rubbish!

Commentary by Roger Erickson

It’s interesting that the conservative economists keep harping on about their belief that the existence of a budget deficit causes uncertainty among private firms who are then reluctant to invest because they fear higher tax rates to pay back the deficit.

For Pete's sake! Can we just insist on improving the semantics of this debate?

We cannot win a debate by endorsing the broken semantics that started it in the 1st place!

This is like recruiting priests to atheism by constantly telling them that there is no God, there is no Devil, there is no Heaven, and that they won't go to Hell.

At the end of the day, we've only imprinted people with the very - semantically incorrect - terms which we've asked them to quit using!

Instead of reinforcing the misleading semantics by repeatedly endorsing their use, don't we have to CEASE, FOREVER, the habit of checking for audience comprehension AFTER THE FACT? That concept is an axiom of statistical process control.* When it comes to communication, an ounce of prevention is still worth a pound of correction? There's tremendous hysteresis in communication loops. Once an audience is distracted, it takes twice as much effort to get 'em back on an adaptive track.

Is it so difficult to switch to some version of the following?

“Increased public self-investment causes citizen uncertainty and reluctance to invest for fear of higher tax rates?”

That frames the supposition consistently from the start, and eases the audience burden of comparing signal intent and signal reception. Tuned semantics makes it easier for audiences to follow the intended logic, not just the distracting semantics. As all propagandists do, this technique pre-loads the supposition, but selects to do so in a group ADAPTIVE direction, not just one advantageous to the propagandist.

We always have to fight communication tactics with communication tactics.

Just smooth the path for audiences to agree, and make it harder for them to DISAGREE.

When framed this or similar ways, more citizens will question the faulty premise we're trying to dislodge from their minds.

Our entire dilemma keeps coming back to the difference between conceptualizing and communicating, and the uncertainty in guaranteeing fidelity between intended and interpreted signals

In numeric coding, this task is universally recognized as critically important, an it is routinely addressed through techniques such as bitwise verification. The uncertainty in public communication, unfortunately, grows with audience diversification, and the conflicting demands of higher tempo vs defining-terms only increases as a function of population size and semantic drift. Yet, compared to other disciplines, policy discussion mostly ignores this critical issue!

Yet we neglect communication fidelity to our detriment.

The Tyranny of Words.

Why on earth is such a fundamental topic SO systemically ignored? The problem was recognized and discussed at length by one of FDRs BrainTrust members, based on his experiences during the 1930s. Why on earth has his message been ignored as well as well as the concept of fiat currency?

What good are tools if we ignore methods for explaining tools and their use to citizens?

* Some readers will undoubtedly accuse me of being difficult to understand sometimes. I can live with it, if they can live with simply looking up terms they're not yet familiar with. The internet allows that latter task to be done in seconds nowadays.

Sounds Like Switzerland Just Might Understand Fiat Currency Operations

Commentary by Roger Erickson

Rather than savage cuts, Switzerland considers “Star Trek” economics
"Switzerland will vote on giving every adult in the country a $2,800 check every month. How would that work?"

John Schmitt, a senior [orthodox] economist at the progressive Center for Economic and Policy Research pooh poohs the idea as unworkable for the USA - largely because we're racists?

Thanks for nothing, John!

So one dumb economist says a particular option of any fiat currency system won't work here? So why are citizens who are actually closer to real operations on the street even listening to what one dumb [orthodox] economist says? Just because some media hack is touting ONE dumb economist as an "expert" that 315 million should listen carefully to?

Wow! The weight of the statistical sampling - let alone the subsequent verification - is suppressing me!

Listen, Josh [reporter on this story,] if you really want us to listen to dumb economists, just have 'em mumble incantations in Latin or some other extinct language, not just in OUR language, using their unique semantic definitions. Their semantics is 80 years out of paradigm. Citizens are going to catch on to the zany semantics - some day. Is that really a chance you are willing to take?

There's this thing called a thesaurus, you know.

However, if you codify the stupid in an extinct language, and put it in a ritual, then trusting serfs .. er, citizens .. often accept the message that some traditions aren't SUPPOSED to be understood, or ever questioned.

Then the self-fraud will never get old. Just institutionalized.  Capiche?

ps: It also protects the sanctity of the dumb economic priests in the hood, where they can have guaranteed ... discretely fettered ... access to young cultural options.  If you play your cards right, Josh, you might even get a guaranteed dispensation from the new institution. I'm sure you get the message.

ps: ps:  On the other hand, if the descendants of current hominids ever learn to wield fiat currency with increasing group agility, just think of the evolution that might yet await!

Our Struggles Start With Semantics. And Quickly Scale Up To "ParadigmAntics."

Commentary by Roger Erickson

At either scale, we just don't enjoy their antics. Here's yet another case in point.

A color-blind MICC clown school is accidentally* putting on a tragedy.

Invisible War - Depleted Uranium and the politics of radiation

This is worse than semantics. It's "paradigmantics" that are rather reminiscent of our ongoing lunacy over fiat currency operations, expressed by a Orthodox clown school attended by fiat-blind Luddites who can only see gold.

However, in this latest case of paradigmantics, yet another crop of idiot savants have THEIR heads up THEIR asses, obsessively fixating ONLY on distributed radiation from depleted uranium used in military arms.

Meanwhile, reality is trying to get their attention, and is literally screaming that it's the heavy-metal toxicity of uranium isotopes that's catastrophic, absolutely REGARDLESS of the radiation half-lives!

"Nonsense," the idiot savant replies. "There's too little radiation to be a threat!"

Cue distributed "BMHOTKs!"

A few experts are publishing in specialty journals, about the newly recognized phenomenon of "paradigmantics," but the bulk of the populous doesn't even grasp that the entire MICC clown school is metaphorically color-blind, and has a view cluttered by the confines of their own asses. That's paradigmantics in action! It runs by it's own peristalsis, so it literally doesn't matter what anyone says, because whole groups have cognitive momentum which traps their interpretation of literally any communication, sucks agility out of it, and molds it into pre-ordained ideological stools ... er .. talking points. No matter what goes in, what comes out is only their prior paradigm.

While the MICC clowns & some initial opposing activists are arguing about the impact of DU (depleted uranium), another phenomenon is slowly developing beneath everyone's noses. The bulk of the populous is starting - subconsciously at first - to define DU as "depleted unity," and nervously looking around for the exits.

So the clown tragedy show goes on, to it's toxic finale. The MICC clown sees ONLY weak radiation, and goes on with their act, oblivious to the red blood of other performers, slowly drying to black.

The audience is just beginning to be horrified, and a stampede for the exits could occur at any second.

* What if it's NOT unwitting?

ps: Clown, audience disconnect.

      Clown:     "If you think semantics is confusing, just ask yourself, what's a semaphore?"

      Audience: "Look, we're hungry. 1%, can you spare us our own paradigms?"

"Why-Fidelity" Always Matters More Than All Tactical Information Combined. We need Why-Fi hotspots far more than just Wi-Fi.

Commentary by Roger Erickson

Why is it that we don't know that? :(

Google Knows Every Wi-Fi Password in the World?

Should we panic? Even if they do?

What's the ancient saying? Without context, data is meaningless? Anyone with a superior paradigm will always be able to operate in complete secrecy, while operating in plain site, using all the right symbols predicted by their own parasites. That's how evolution works, through domestication and assimilation. For optimal utilization, hosts allow parasites to see literally EVERYTHING, simply because they understand NOTHING that matters critically to future survival.

Rest assured. No one knows all the emerging Why-Fi passwords. There are none!

Look at it this way. How many conversations have you had where you slowly realize that two or more people are carrying out a seemingly coherent discussion exchanging the same words ... but it, only slowly to you, if at all to them, becomes apparent ... that they are assigning entirely different meanings to the shared words they're both seamlessly using! And neither knows the full extent of what they THINK they are really saying and hearing?

Ok, leave out the glaring example of Deficit Hawks talking with those capable of rational thought. That's a skewed example. Think of other, less critical cases.

It's called semantics, and it occurs - intended or accidentally - everywhere from comedy to philosophy to propaganda and now, of course, for decades in daily policy discourse, entirely unintended we assume. Without defining terms, however, group discourse does NOT hold or express potential group intelligence.

And so, in our endlessly divisive arguments over who's got the fiat, where public initiative comes from, and who's got what ... is our net search for gorup meaning getting warm yet?

No? Then perhaps it might help to heat up the national intelligence with a few Why-Fi hotspots, not just Wi-Fi transimission of data missing context?

Throughout history, Elders, then Shamans, then Libraries and Universities served as early Why-Fi hotspots.

Where can you find even one now, that logically discriminates context from just data? Is the Center of the Universe really found at the Harvard Economics department - or is it unwelcome there by the elite, Sophist residents?

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

How to Discuss Fiat Currency Supply With Luddites, Small Children and Non-Initiates (like Politicians)

Commentary by Roger Erickson

Luddites (and/or petty crooks and sophisticated Control Frauds) are constantly heard discussing fiat currency supply in panicky tones and fearful terms.

It's as though they live in constant fear that we will run out of fiat. (Although I've never heard a definition of how such an abstract condition could ever actually occur. Maybe among the severely ill, depressed or lethargic? Perhaps in patients with advanced Parkinson's Disease - bereft of the neural ability to trigger even volitional thoughts, let alone motor actions?)

Even most of those trying to help Luddites understand fiat currency don't help. The "helpers" often complain that Luddites just won't listen.

Yet what is it that they won't listen to?

Semantics always seems to be a big part of the problem. Please stop sloppily calling net fiat currency creation a "debt," or even a deficit - at least with novices. Without defining terms, semantics lapses into useless sophistry - a perennial tool used by crooks to separate fools from their resources.

Nearly every word in every language has multiple meanings, based on context. That's the price we pay for having lean, dynamic linguistics. Don't argue over it. Just define your terms, and the context they're used in!

Imagine 50 people meeting at the Tower of Babel and discovering to their joy that they all use the same alphabet, script and words! Happy coincidence! They're problems are half over - but only half. Imagine their horror to discover that all 50 assign different meanings to the exact same spoken and written words. Worse, they all have multiple meanings for every shared word, based on the particular context discussed using their particular grammar and phraseology. To be exactly sure of the meaning of a given sentence, you could easily have a 50x50 matrix of possible meaning options to parse! Actually, this situation applies to everyone's daily experiences. So how do humans manage this nightmare scenario? Easily, it turns out. Everyone simply defines their terms whenever initiating a discussion - everyone except priests and economists! Those two professions are wont to chant long strings of incantations mixing in just enough familiar words to be mesmerizing, but perverting them with such a jumble of ambiguity and archaic expressions so as to render them unintelligible for pragmatic use. 

Please. When discussing the topic of fiat currency supply with Luddites - or simply the uninitiated - respect your audience, and take care to talk about bonds, banking reserves, return on coordination, interest rates, inflation or deflation levels, currency supply, Output Gap, jobs, national capabilities ... anything but confusing sophistry.

You don't convince many people to be atheists ONLY by repeatedly telling them that there is no God, there is no devil, there is no hell and that they're NOT going to heaven. The ONLY thing they'll know is what you're telling them not to pay attention to. FAIL! Losing strategy.

So, remind novices entering every topic unfamiliar to them that there are these concepts called semantics, sophistry and linguistic redundancy.  Then stick to talking about concepts that ARE adaptive for that particular conversation. Define terms and context, and then talk about desired outcomes. Nothing more & nothing less.

Organized "Systems" Cannot Grow by Decreasing Use of Their Own Liquidity Tools

commentary by Roger Erickson

Consider the "Austerity Now" drumbeat still rising in Europe, and then think outside isolated perspective of any one speciality blindly groping an elephantine context.

Do the specialists calling for austerity even know that there their calls produce contradictory signals in the perspectives of other, invaluable segments of their own population?

"Two less steel factories in every country, and two less chickens in every pot! Yeah!!"

Cameron tells EU leaders to stop budget 'tinkering' and instead impose big cuts

Cameron digs in to protect UK rebate [rebate? freeze the rebate from a shrinking budget?  dead-on-arrival negotiating ploy?]

Tata Steel is to axe 900 jobs and shut a dozen plants in the UK in a bid to cut costs after it revealed it had tumbled into the red earlier this month.

It's already evident that when perspectives from inseparable system processes become isolated, their inevitable re-collision invariably sounds much like a script from Alice in Blunderland, especially the paragraph on things sometimes done twice before lunch.

Fuel for poets, comedians and cynics also result. What's the inverse of building the British Empire? Self-degradation? Dismantling, and taking others down with you? Burning the furniture in hovels below Camelot? A burning sewer beneath a hill?

Humor aside, let's imagine stepping back far enough to get a full view of the entire group of blind specialists groping this context and shouting out their blindly local advice.

The first, obvious lesson from our encompassing view is that continuous growth of an organized "system" cannot occur by decreasing use of it's liquidity metrics. That's logic 101.

In the isolated sub-context seen by most economists and politicians, disuse of liquidity metrics equates to hoarding fiat currency, aka sequestering 'profit' margins. Yet in the perspective of all system analysts, liquidity as a concept is inseparable from quality (including tempo) of feedback distribution, which is what greases the quality of distributed decision-making in supposedly organized systems.

Astute readers may immediately jump to the conclusion that Political Economics is too important to be left to the combination of politicians and academic economists? Ya think? The isolated views of politicians and economists are meaningless unless shaped by the full range of operational feedback (aka, context models), from all other sub-processes existing in a given economy and culture. A context model = the full body of group feedback, it's that simple.  We have no higher authority available to appeal to.  Just ourselves.

By now it should also be blindingly obvious that every process is too important to be left to the presumed process owners, especially in any group growing by either diversity or population. That's a truism precisely because liquidity for decision-making in such groups is mediated by increasingly context-specific re-use of the same language signals. Given that data is meaningless without context, no specialist part of a complex system can ever - by definition - access or wield the inter-dependency data required for full-group tuning, aka policy agility - unless they receive adequate samplings of full-group feedback, in real-time.

Just as unlimited fiat currency supplies accurate records of transaction liquidity, "unlimited cross feedback" in group discourse constitutes "awareness liquidity," and supplies accurate instantiation of Situational Agility. That's why optimal organization =  OpenSource.  To be blunt, agile group actions track our rate of updating group-wide Situational Awareness (aka, NOT isolating process management from timely group feedback). Distributed Situational Awareness only occurs with adequate feedback liquidity, constantly cutting across all sub-context-specific wording, taxonomies and semantic triggers to continuously rebuild and drive just-adequate Group Agility.

The very act of restricting semantic liquidity - aka, leaving sub-processes to presumed process owners - precludes system tuning. Leaving political economics to politicians and economists was not only doomed from the start, it was always an act of outright imbecility. Without scalability of council interactions, every culture quickly degrades to action patterns driven only by mob ignorance.

Every collection of highly organized tribes fusing into a super-culture must, by definition, get collectively dumber before new methods allow them to regain and then actually grow group smarts. Re-growing expanded group intelligence always starts with complete redesign of feedback channels, bandwidth, and methods for relaxing information flow patterns to states first to deliver just-adequate Adaptive Rate performance.  [After all, adequate Situational Awareness today is better than perfect historical awareness next year.]

Survival depends on developing distributed methods for doing all of the above faster every year. In human cultures, one small part of that involves methods for adjusting lean, coherent language taxonomies and managing local variance of semantic triggers.

In a population as large and dynamic as ours, we cannot survive unless an informed electorate is aware of different patterns of things every year, is acutely responsive to the moment to moment demand to alter it's Situational Awareness, and is also aware of tools and methods for tuning and leveraging it's own, distributed awareness.

Having said all that, a simple question results. Has anyone ever seen a single taxonomic model providing rapid, population-wide visualization of Public Policy Perceptions? Without models for increasingly rapid tracking of degenerate use of terms by diverse sub-audiences, we will, with absolute certainty, grow into an unstable mob, not a growing nation.

A Very Condensed Introduction to Currency Operations, for Erskine Bowles

If you claim to grasp the concept of situational awareness then you have to go back and ask about the fundamental change in our currency situation that occurred in 1933, when we transitioned from a gold-standard to a fiat-currency-standard. It’s quite a fundamental change, with trivially obvious consequences. Anyone not at least looking into that situational change is doing their country a grave disservice.

Would a military deploy soldiers who were not able to fully disassemble and reassemble their personal weapons in the dark? Similarly, no citizen should try to discuss fiat currency operations or fiscal policy without learning at least the simple rudiments of how they actually work.

What follows is a very condensed summary of much of the content found at Mosler's Mandatory Readings and from follow-on references where noted.

1) On a "fiat" currency regime, there is no such thing a “national debt,” there is no REAL purpose for “balanced fiat,” and it’s plain ignorant to directly compare the budget of currency users (e.g., Greece or, say, Nebraska) to currency issuers (e.g,. USA, UK, Sweden, or even the ECB [european central bank]). Countries using the “euro” are not sovereign masters of their own currency. Comparing them to sovereign currency issuers like the USA is worse than comparing apples & oranges, it’s more like comparing predators & prey.

2) “Fiat” means there’s no static asset metric that a unit of account (currency) is convertible to upon demand. Rather, the unit of account is backed purely and only by the initiative of the public issuing the currency - and it's conversion rate to static assets must float, by definition.  Simple network dynamics dictate that to make liquidity co-scale with expanding options, a growing population and economy must steadily increase fiat incomes and fiat-currency-savings, NOT maintain buying power of the unit of account.  If population & economic options are increasing, then price stability must float, although hopefully within variance tolerance limits allowing continuously smooth transitions instead of wasteful gyrations.

3) Fiat currency isn’t obtained by the issuer from anyone, hence there’s no one to “pay it back” to. The fiscal goal for a nation using fiat currency reduces to maintaining adequately distributed currency supply within tolerance limits, neither too much (contributing to EXCESS inflation) nor too little (contributing to EXCESS deflation, what is we have had in the USA from 2008-2013).

4) The concept of currency revenue is obsolete for a fiat currency ISSUER. In 1933, the entire function of taxes was changed, from getting revenue from a net currency supply dictated by gold-hoarding plutocrats, to managing net aggregate demand and shaping it’s profile (i.e., taxes as deterrents for specific transaction types).

5) Do not conflate the concepts of foreign currency (Fx) reserves, Treasury bonds, and fiat-currency budget “deficits.”

a) Countries who export to the USA are paid in $US, and THEY HAVE ALREADY BEEN PAID IN FULL! Their payments are sitting in accounts at the US Federal Reserve bank – as Fx Reserves. We DO NOT BORROW OUR OWN FIAT CURRENCY FROM ANYONE ELSE! It’s actually impossible, since the US Treasury is the monopoly issuer of $US.

b) As part of the double-entry accounting process for acknowledging currency creation (i.e., an accounting entry w/o a corresponding debit), we use TTL Accounts & T-bonds to drain banking-reserve notation from the accounts of private banks at our Central Bank, the Fed (Federal Reserve Bank). T-bonds are just a habit left over from the gold-std days. They’re simply a policy decision to spend more fiat, not to borrow fiat.
“The Treasury tax and loan account system was designed as a mechanism for minimizing the dislocations on bank reserves and the money market arising out of the sizable and irregular transfers between the Government and the public.”
Treasury tax and loan accounts and Federal Reserve open market operations

c) For countries using a fiat-currency-standard, a fiscal “deficit” is purely an accounting term, denoting the growth in net currency supply used by a growing nation. The fiat deficit is the yearly difference between currency created by Treasury spending and that amount clawed back as federal taxes. The cumulative, so-called, “public debt” is therefore equal to net private currency-savings, to the penny. Given a monopoly currency issuer and tax authority, a growing economy can only accumulate net currency-savings (credits) if the issuer commits to net issuance (debits). So fiscal "deficits" and "debts" are simply the accounting terms necessary to manage national currency supply. When the same words have different meanings in different contexts, it's YOUR responsibility to use them properly. That reality is part of what we call semantics.  For efficiency, every existing language maintains the right to assign context-specific meanings to words.  That makes language an efficient, agile tool, yet the utility of every tool depends upon intelligent use.

If you want to at least learn the rudiments of fiat currency operations and reserve banking, here’s a Dick&Jane level primer.

After that, please read up on Marriner Eccles, the Fed chief who oversaw our transition from the gold std to our existing fiat currency.

Marriner S. Eccles and the Federal Reserve Policy, 1934-1951

Marriner Eccles – HEARINGS BEFORE THE 1933 Senate COMMITTEE ON FINANCE

DIRECT PURCHASES OF GOVERNMENT SECURITIES BY FEDERAL RESERVE BANKSMarriner Eccles, 1947

For those already steeped in financial semantics, these topics are tediously reviewd in full by Stephanie Kelton.
Can Taxes and Bonds Finance Government Spending?

Can anyone get Erskine Bowles to read this?  If so, can you also determine whether he knows the linguistic definition of semantics?

RyanoBachmannalia - Where Does it Leave Us?

Warren Mosler has some succinct observations about the politics of fiscal policy, which are worth re-posting as is. However, even after his comments, the same 2, perennial questions remain.  First, if it's long past time to start doing things differently, how do we take the 1st step on that 1000-mile journey?  We've been asking that question periodically, since Ben Franklin, Abe Lincoln & Marriner Eccles.  Isn't it past time to permanently capture known answers?  Second, how do we bite the bullet and take steps to permanently capture this as an obvious, incidental part of cultural knowledge base?  Yes, it's embarrassing, and a travesty.  What do we DO about it?

Ryan the next Bachman - (by Warren Mosler)

There's a reason the hardcore budget balancer/deficit hawks don't last long under the microscope. Their numbers can't add up, which leaves them with contradictory statements.

Why can't they add up?
[Because dollars are part of] a 'closed system,' what's called a case of 'inside money,' due to the fact that they all come from [government] and/or its designated agents (apart from counterfeits).

This means the [growing number of] dollars in our pension funds, ira's, corporate reserves, cash in circulation, foreign central bank reserves, etc. etc. all come from someone else spending more than his income.

Yes, the rest of the private sector can and does often spend a bit more than it's income to supply those 'saver's dollars,' but most of it comes from the $15 trillion or so the US govt. has spent [yearly] in excess of its tax collections.
That's called federal deficit spending.

[RGE:  Don't ask me why the REAL economy acquiesces in calling fiat currency creation a "deficit." Accounting semantics should converge to reality. The inverse doesn't seem realistic, or even temporarily useful.]

In fact, the US govt. "debt" is equal to the net dollar denominated 'savings' of all the other sectors combined.
To the penny.
It can't come from anywhere else [except currency creation].

That means any plan to balance the federal budget is also a plan that doesn't allow global dollar savings to grow. [That includes all] the 'automatic savings' like dollars going into and compounding in pension funds, ira's, corporate reserves, cash in circulation, and foreign central bank reserves, etc. etc. [All that savings] either can't happen or [they] are 'supplied' by equal private sector debt increases.

So a plan to reduce the "deficit" [by] $10 trillion from current forecasts is also a plan that either causes private sector debt to increase by that much and/or causes pensions, ira's, corporate reserves, cash in circulation, and foreign central bank reserves to decrease by that much.

None of which is consistent with a growing economy, to say the least.

This means, any plan for long term deficit reduction that includes relatively high rates of growth is what can be called a financial optical illusion, [one] that doesn't hold up on close examination.

And that's why all the budget balancers ultimately fail.
Yes, their headline rhetoric can be casually convincing and even win local elections. But under serious scrutiny, it all falls apart.

But maybe this time it's different.
:( 

[RGE: Don't hold your breath, Warren. The problem is not with currency operations. The key problem is mixing semantics across fields which insist on using different semantics without accurately defining their terms when interacting. That's a situational awareness task, not a monetary operations task. We're arguing over tactics & strategy using sloppy, disorganized terms, while not even defining what success means.  The result is tactics masquerading as national goals.]

The Original Liar's Loan

Who had proper title to Eden? :)

Clouded Title: The history of religious crusades and ethnic cleansing of indigenous peoples by invaders claiming the right to appropriate other peoples property based on Papal dispensations, biblical manipulations, or ancient religious connections to other peoples territories.

That's a fascinating topic, with deep implications.

Law of the Jungle <==> Law of Bungled Title? <==> Law of Semantics?

Before getting lost in the maze of implications, let's jump straight to the conclusion.

The only higher law is the Law of Recombination, given that the highest return is always the return on coordination. Anyone settling for ownership & theft is settling for far, far less than they could be part of.  Ben Franklin recognized this, in his famous "table talk" to the 1st Constitutional Congress.

We should stick with our original rallying cry. "We came, we saw, we made a more perfect union."  That focus on coordination is what produced the greatest wealth in human history.  Anything less is embarrassingly stupid. Progress always follows Open Recruitment and careful selection of optimal recombinations.

ps:  Multiple CopyWrong lawsuits are in process in the Court of Reality, claiming that Eden was a plagiarized idea.  Is nothing really sacred among crooks?