Tuesday, November 27, 2012

Governance Failure: Reason for Concern



Jena came twenty years after the death of Frederick the Great; the crash will come twenty years after my departure if things go on like this.  
        Otto von Bismarck's final warning to Kaiser Wilhelm II, 1897

In the United States, Woodrow Wilson is considered the father of public administration.  In the academic world, Lorenz Von Stein is considered the founder of the study of public administration.  However, I argue that in practical terms it was Bismarck who formalized modern Western notions of public administration.  In this sense, we can consider Otto Von Bismarck the father of administration.  In the quote, Bismarck warns Wilhelm against the folly and extravagance that can ruin a nation.  

As a theory of history, governance failure builds on Bismark's warning: we may have entered a period in American history where the state will loose its capacity to perform the functions it did during the 19th and 20th centuries.  Obviously the US is not a failed state but the likelihood of such a situation emerging in the next 10 to 30 years is rising.  Complex, interdependent, and supposed black swan events in financial markets and the physical environment highlight this possibility.  

As a theory of economics, governance failure is an analog to the theory of market failure.  Under market failure, economists have noted how certain goods lack certain qualities - namely exclusivity and excludability - and thus those markets that exchange those goods do not operate as ordinary theory predicts.  Those markets do not reach the same ordinary and generally beneficial equilibria that other markets do.*  

Governance failure is the condition where the economic and logistical problems, which the state has normally addressed, exceed the capacity of the state.  Like its market analog, people (and circumstance) can seize upon these failures and produce negative economic and political outcomes.  Below are a few mini-case studies in governance failure that involve current events.  I present them not to suggest that government itself is failure prone but simply to document particularly new and meaningful cases of failure and contradiction.  Despite obvious redeeming qualities of the American government (such as a strong national defense and various state-related institutions of civil society), governance in the United States now exhibits a degree of absurdity.

2011 Debt-Ceiling Crisis
The long and short of the 2011 debt ceiling crisis is that, although the Republican and Democrats did create a short term solution, they did not create a comprehensive long term solution; and they failed to avoid a rating downgrade, which left the American taxpayer with real increased tax liabilities in the form of greater interest payments on more volatile debt.  To quote John Canavan of Stone & McCarthy Research Associates, "You increase uncertainty in the markets and the markets will demand compensation for that." Congress's failure to create a solution in a timely fashion - in other words doing the job they are charged and compensated to do - is costing American taxpayers real dollars.**

Iraq Reconstruction Fraud
Reporting on this subject has been alarmingly overlooked.  Since the start of the Iraq War, a number of articles came out addressing pallets of lost American dollars.  (See these photos.)  Various articles covered mismanagement and/or fraud involving different amounts - $6.6B, $8.8B, $9B, $23B$50B, and onward up to $150B - depending on the news source and time.  Both American and Iraqi nationals and others have been successfully prosecuted.  Some recent reports suggest that US funds may have even gone to Iraqi insurgents.  This case highlights a greater and more complex case of 'governance failure' - namely the decision to go to war itself. 

Stop Trading on Congressional Knowledge Act
The Stock Act was first introduced in March 2006 by Louise M. Slaughter (D-New York). The final bill was signed into law in April 2012 and prohibits members and employees of Congress from insider trading.  Early versions of the law covered day trading and political intelligence.  Today the law does not cover political intelligence. Let us ignore that the final law was weaker than Slaughter had hoped.  The deeper question is why did it take six years for Congress to confront a clear case of inequity.  I get that Congress members are not 'insiders' in a classic sense but they are clearly 'insiders' in a material sense.  The only reason they would have dragged their feet on this issue was financial gain.  It begs the question: if you are not up to the task of governing yourselves, are you up to the task of governing the nation?  (Here is a fun watch on the subject.)

Passing Laws Without Reading Them
Representative John Conyers (D-Michigan) has twice suggested that he and others in Congress do not read and perhaps should not read the bills on which they vote.  In response to a question about the Patriot Act, he famously told filmmaker Michael Moore in the film Fahrenheit 911: "Sit down, my son.  We don't read most of the bills".  More recently at a National Press Club luncheon in July 2009 Conyers said of the Patient Protection and Affordable Care Act (PPACA): "What good is reading the bill if it's a thousand pages and you don't have two days and two lawyers to find out what it means after your read the bill?"  

At best, Conyers is himself suggesting that a part of the administrative process of Congress does not function.  Nevertheless, it should not seem stodgy to expect our politicians read the bills on which they vote.  That is among the most simple and critical tasks that a politician can fulfill.  If they can't, then they need to stop passing laws and take the time to audit their own internal procedures and govern themselves.  Here is a related quote.  It is simply Orwellian.  In March 2009, then Representative and now Minority Leader Nancy Pelosi (D-California) said of the PPACA: "We have to pass the bill so that you can find out what is in it."  Need I say more?

Other Cases

Significant other cases of governance failure that deserve analysis include: Hurricane Katrina, the War on Drugs, and almost certainly every environmental issue involving soil quality, fresh water resource availability, and species loss (i.e. biological diversity losses). A particularly significant case that deserves attention is the Emergency Economic Stabilization Act of 2008 and the so-called Too-Big-Too-Fail issue.  However, it is an especially complex subject that deserves care and space not available here.

What might these cases suggest about governance today?  Although a robust and scientific answer to this question requires more space and resources, these cases reflect how our social and political systems and decision methods have not developed in step with our scientific and economic innovations.  Not only have systems themselves become more complex, people have perhaps become less integrous.  As such, the deeper question is not whether more politicking or new reforms are a solution but whether we even have the moral capacity to improve our lives with policy.  With both individual integrity and system complexity in mind, we have this question: is the Western state, as exemplified by governance in the US, on a downward trend?


Please comment!  Part 2 is here!

* Governance failure is not government failure.  Governance failure addresses conditions where state intervention fails when it rightly should not.  Government failure addresses conditions where state intervention inherently creates bad outcomes.  Governance failure also differs from state failure, which like government failure is a theory of political science. 

** A recent quote from Senator Tom Coburn (R-Oklahoma) on On the Record with Greta Van Susteren focuses explicitly on the issue of Washington honesty and character. Coburn recently released a book titled The Debt Bomb.  In the interview he responds to a question on why he chose to include a quote from President Lincoln regarding character and power: "Because I want people to make an assessment of where we are today and what the character is in Washington.  If we address our problems and honest with the American people, we don't have a problem in front of us we can't solve.  If we continue to lie and mislead the American people as to the seriousness and the urgency of our problems, what you can see [is] that very much replicates the character that I see in Washington today."  It's a rather sincere indictment of an environment he knows well.

Sunday, April 15, 2012

Peculiar Times: Political Rights in America Today

### Update (5-19-12):  According to the Los Angeles Times, federal district Katherine B. Forrest has ruled Section 1021 'facially unconstitutional' in the context of the 1st Amendment particularly involving free speech.  The judge issued an injunction against the use of Section 1021.

One of the most important hypotheses I hope to share in the option3 project is that the two party system is an illusion that will not likely serve our understanding of and ability to solve the complex problems of the evolving now.

A growing concern of mine reflects the artificiality and deceptiveness that lies in the division between Republicans and Democrats in relation to the issue of civil liberties; during eight years of Bush and nearly 4 years of Obama, the individual's sphere of influence and sovereignty have diminished.  Not only has the political domain of the individual decreased but the political domain of the corporation and the state have increased.  Below is a low-lying-fruit analysis of the subject in question - not an exhaustive legal account, which would be a valuable document.

Under Bush, we acquiesced (or allowed the Congressional acquiescence) to the Military Commissions Act of 2006 (MCA) as well as an assault on the Foreign Intelligence Surveillance Act of 1978 (FISA).  Certain provisions in the MCA constituted an unconstitutional encroachment on habeas corpus.  For good reason the Supreme Court suspended those provisions in 2008 in Bourmediene v. Bush.  It is worth noting that habeas corpus is a fundamental component of the rule of law.  Furthermore, it is well established that Bush ordered and the National Security Agency implemented domestic wiretapping without the legally required use of FISA courts - perhaps even before 911.  The subject remains largely unresolved today.  

Under Obama, we have acquiesced to the National Defense Reauthorization Act of Fiscal Year 2012 (NDAA), including Section 1021 which constitutes an assault on the Posse Comitatus Act of 1878, habeas corpus, and due process - another fundamental component of the rule of law.  Section 1021 affirms existing authority under the Authorization for Use of Military Force of 2001 (AUMF) to detain via our national military anyone without trial and indefinitely or at least until the end of "hostilities" authorized by AUMF, which has already been 11 years.  (See update below regarding Section 1021.)  

Attorney General Eric Holder has even attempted to argue that the executive can conduct due process itself based on legal theory that he has apparently developed, not unlike the legal methodology of former Department of Justice attorney John Yoo, who some argue committed war crimes during the Bush presidency.  The overall consensus regarding the actions of Holder and Yoo could easily differ overtime.  But the use of new administrative interpretations of law rather than established judicial interpretations transcends presidencies. 

Under both Bush and Obama, we have had to swallow the Patriot Act of 2001 and its reauthorizations as well as assaults on the War Powers Clause of the US Constitution (WPC) and perhaps the War Powers Resolution of 1973 (WPR).*  Ironically, Bush seems to have appealed to these last two pieces of legislation in invading Afghanistan; of course he did not with the Iraq War.  The issue of either legislation barely came up in the context of the Libyan Civil War.  In part as a result, one member of the House of Representatives, Walter Jones (R-North Carolina), has introduced a preemptive presidential impeachment bill given the WPC

The Patriot Act is not an easy subject to deconstruct.  It is a large document that has sunset provisions, has gone under multiple reauthorizations, and also possesses provisions, for example involving "national security letters", that have been partially struck down in federal court.  Nevertheless, some argue that Section 215 is at odds with traditional notions of search and seizure - another fundamental component of the rule of law.  In a provocative letter to Eric Holder, Senators Wyden (D-Oregon) and Udall (D-Colorado) addressed the "problem of secret law" and the "subject of secret legal interpretations" involving 215.  Wyden and Udall wrote we "believe most Americans would be stunned to learn details of how these secret court opinions have interpreted Section 215 of the Patriot Act."  Obama's relationship to the Patriot Act clearly deserves greater attention.  

However, a more exhaustive analysis of the Patriot Act or even Section 215 alone is beyond the scope of this blog; it is worth noting that the act has been more effective in addressing money laundering, immigration, fraud, and drug crimes than terrorism, which brings into focus an important question: what is the relationship between the intention of those who support the act and the actual impacts of the act?  I leave this question for the reader to consider. 

In conclusion, many people have proffered the argument that contemporary security risks require the weakening of certain rights.  To an extent this argument might have validity.  To an extent that argument is still axiomatically false.  To sacrifice our rights is to sacrifice our nature as Americans.  The act of sacrificing our rights is itself a destruction of our content.

As our civil liberties diminish and the technology and practice of surveillance sharpen, the real questions of economic history remain unanswered.  When we consider the above matters along with other cases such as Santa Clara County v. Southern Pacific Railroad** and Citizens United v. Federal Election Commission, we might legitimately speculate that the corporate and political elite have got the average person in a stranglehold today.  It is, however, a semi-conscious stranglehold where the average person has played a role in his own undoing by not voicing more dissent, which I encourage you to do.


*  The WPR has been more or less the the whipping boy of all presidents since its creation.  Perhaps with exceptions of Presidents Nixon, Ford and Carter, all presidents since its creation have largely ignored the WPR.  (I want to acknowledge that the WPR is itself not a cut and dry subject; many people question its own constitutionality.) 

**  This case is the foundation for laws that have established corporate personhood.

Sunday, March 25, 2012

The Hunger Games ( a review )

Entertainment is a pivotal component of history, meaning, culture, and self-awareness. Entertainment is also a profound instrument (conscious or not) of public policy although only in the long term - which is to say only when it counts! As such, I decided to review The Hunger Games. (Minor spoiler alerts!)

The Hunger Games is, in short, excellent. Totally engrossing, utterly imaginative, and completely disturbing. I suspect it's not an award-oriented film but people will love it and already do. It compares quite well with similar dystopian films of the last ten years but it offers something bigger and more conceptual. The Hunger Games is not a trivial film.

While it did not quite have same 'realness' of Children of Men, it paints a bigger picture not unlike V of Vendetta. It does so by shedding light on the relationship between the state, entertainment, and the individual's effort towards survival and meaning. The premise of the film is that after an apparent major war and revolution in North America, a new state, Panem, has emerged with a dominant capital city. The state has created a system of ritual sacrifice where each of 12 districts stage lotteries called 'reapings' where a young woman and man aged 12 to 18 are selected to fight to the death on television.

As I watched the film I was tempted to compare this premise with certain contemporary wars involving the US. Obviously it's not that simple. But it might be...and thats one of many terrifyingly sobering insights hidden in metaphor throughout the film. As it turns out, Suzanne Collins, the author of the original books upon which the film is based, had a somewhat similar idea. As the story goes, she was changing channels between reality TV shows and footage of the Iraq war and the two subjects blurred in an "unsettling way". It was at this moment where Collins initially conceptualized Katniss Everdeen, the protagonist (played by Jennifer Lawrence).

What is most striking about The Hunger Games is that it comes at a point in history where the forecasts of past from such thinkers as Aldous Huxley, Michel Foucault, George Orwell, and Karl Polanyi seemed to have proven somewhat accurate in foreseeing contemporary industrial and post-industrial life under various forms of administrative government. Even more revealing is how these thinkers have been accurate about the rising power of the state and the falling power of the individual to conduct his of her life. Although descriptions of the future are always destined for failure, the hypotheses that instigated these descriptions seems to have been proven more true than not as though they are merely confirmations of what we see changing before our very eyes.

The Hunger Games very clearly addresses related issues such as the management of human will, the creation of public illusions, and the regimentation of the human body. In a pivotal scene that presumably sets the subtext for all three books, President Snow (played by Donald Sutherland) give a warning to Seneca Crane (played by Wes Bentley), the 'Head Gamemaker' or producer of the games. The warning is that hope "is the only thing stronger than fear. A little hope is effective. A lot of hope is dangerous." The film has many poetic moments such as this.

Another comparable film is Running Man, which I saw as a boy in 1987. The moral distance between the real 1987 and the dystopian vision of 2019 portrayed in Running Man is smaller than the moral distance between the real 2012 and the dystopian vision of about 2100 portrayed in The Hunger Games. And that's a very disturbing idea.

If you examine the sterilization cases in North Carolina, various trends in policing the homeless and foodless, a recent Google patent request that involves using 'environmental conditions' in your home to tailor advertisements, a newly released high-tech Samsung TV that can read your facial expressions and recognize your voice, or last, CIA Director David Petraeus's recent statements regarding the ability to spy on people through their own "personal and household devices"...if you examine these stories, they provide anecdotal evidence that an incomplete but meaningful scientific dictatorship is increasingly possible. Given the economic instability across the planet, the nature of new jobs in the US, rising inequality, global food and water insecurity, you can see other similarities between the story in the film and our own lives. It is for these real and present day reasons that I find The Hunger Games so interesting.

Regardless, The Hunger Games, as a piece of art and art alone, is wonderful. Jennifer Lawrence just about flawlessly holds the film together. A good deal of the cinematography that captures her as a character and a figure is simply beautiful - not to forgot the moving subplot revolving around her protection of a younger competitor in the games named Rue (played by Amandla Stenberg). The pacing of the film is adequate though somewhat off at times. The production design is engaging, especially in the beginning portion of the film; in the capital it sometimes has a digital feel.

Josh Hutcherson is solid in the role of the loyal albeit simple Peeta Mellark. Stanley Tucci and Elizabeth Banks, in particular, play their disturbing roles to a T as game show host and premier escort, respectively. Woody Harrelson and Lenny Kravitz have endearing moments as Katniss's mentor and stylist, respectively. It is perhaps not a film designed to highlight acting but Lawrence and, to a lesser extent, Donald Sutherland are powerful. I suspect it will be among the most popular films of 2012 and, with its sequels, will yield new and refreshing analysis of the approaching now.

Tuesday, March 13, 2012

Iran and Perpetual War: Kissinger, Dempsey, and Dagan

In March 2003, I wrote letters to a few members of Congress where I basically said the the War in Iraq was a bad idea. I argued it was unsound legally and logistically. Although many people to this day still overlook the legal issues surrounding the War in Iraq during the Bush presidency, some are taking an earlier and more aggressive stance regarding new declarations of war during the current Obama presidency. As for the logistical wisdom of the War in Iraq, most people probably agree it was a mistake or at least we got dragged into supporting it under false pretenses. All these revelations put into focus the psychological, physical, and mortal losses that have occurred in Iraq - on both our side and theirs.

I share this story because I am amazed as I hear many people call for a second pre-emptive war in less than 10 years - this time in Iran. Pre-emptive wars certainly require a great deal of necessity if they are even ever legitimate. I do not think we (or even Israel) have reached that level of necessity. I especially consider two sets of questions as this discussion unfolds.

One, have we reached a point in human history where perpetual war has become inherently necessary? In other words, is our seemingly pathological need for war natural? I do not think so. Although war has a natural role in human life, that role is not perpetual. It is in the very nature of war that it should come into necessity and then fade out of necessity - similar to how individuals have arguments which eventually come to an end (even if they end violently). A world with perpetual war is neither natural nor beneficial to the average person.

So the question becomes, two, why are we in a state of perpetual war? Perhaps we are slowly lurching towards a third world war; and the last 11 years is simply a build up of tensions. Perhaps the answer to the first question is wrong; and perpetual war is the new norm due to population dynamics or some other factor. Perhaps we are simply being manipulated. But why? And by who? A candidate theory is that arms producers and international bankers want more war to sell arms and lend money to all sides of modern conflict.

This theory (T1) deserves careful analysis, which is beyond the scope of this blog. But I wanted to share the idea because, with perhaps two exceptions, I have yet to come across peer-reviewed academic literature or writing from a respected academic in the last 50 years that addresses the subject. Those two possible exceptions are the research of Antony Sutton and Carroll Quigley. I have also read quotes from authentic and informed sources such as Smedley Butler, Douglas MacArthur, and, of course, Dwight D. Eisenhower. But for the most part the subject has remained understudied perhaps for obvious reasons. In truth, perpetual war, if such a state of affairs has emerged, likely has many causes each of which merit attention.

But I digress. Although I can't decisively address the nature of perpetual war here, I can consider the intelligence of a war in Iran as it looks today.

One of my current favorite mainstream sources of news analysis is Fareed Zakaria's Global Public Square (GPS) on CNN. For the time being, I find Zakaria's analysis above average.* As of March 11th, Zakaria has actively editorialized against a war in Iran. He has made several useful observations: 1) Iran has no nuclear weapons, 2) evidence of a desire to possess a nuclear weapon is ambiguous, and 3) evidence that a nuclear Iran will create a nuclear domino effect in the Middle East is weakened by the counter-factual cases of North Korea and Israel.

Although this sunday Zakaria interviewed former US Secretary of State and National Security Advisor Henry Kissinger, who shared a somewhat aggressive perspective on Iran, the Sunday before last Zakaria interviewed US Joint Chiefs of Staff General Martin Dempsey, which had a different tone and content.

The Dempsey interview was revealing in that it illustrated that, despite aggressive political rhetoric, we have unusually analytic, wise, and prudent-thinking people involved in the highest levels of military, which is no surprise. Dempsey made at least three rather interesting points: 1) the Iranian regime has yet to clearly demonstrate the desire to weaponize its nuclear capabilities, 2) "the Iranian regime is a rational actor", and 3) most revealing, it's "not prudent at this point to decide to attack Iran."

Dempsey also said that sanctions, international cooperation, diplomacy, and our own military preparedness are working to impact Iranian decision-making. It is unknown whether or not this is true. But time and only time will tell. And although time brings risk so does premature war. A third interview sheds additional light on the question of timing.

On 60 Minutes this sunday Lesley Stahl interviewed former Israeli Defense Forces officer and former Director of Mossad Meir Dagan. The interview proffered several insights. According to Dagan, 1) Iran and Iranian President Mahmoud Ahmadinejad are rational actors albeit in a non-Western sense, 2) the risks of a "regional war" are significant, and, most incredibly, 3) military attacks can only delay the "Iranian nuclear project".

Taken together Dempsey and Dagan paint a calculated picture where the call for war is premature. I am reminded of the Orwell quote: "All the war-propaganda, all the screaming and lies and hatred, comes invariably from people who are not fighting."

It should be noted that this entire discourse might in its own clever fashion provide the political drama that ushers in the alleged need for war. Just by talking about it, we will inevitably experience it, which returns us to the question of manipulation. Some have called this pattern one application of the Hegelian Dialectic or the problem-reaction-solution process. At this stage we are simply defining what the problem will ultimately look like. It is, unfortunately, a predicable exercise with a predicable outcome. But in having an awareness of the process, we anneal ourselves against the fear, stupidity, and the herd tendency in humanity that might lead us to a possibly unnecessary war.

* Zakaria did a report last March comparing the United States with other countries, focusing on education outcomes, economic growth, life expectancy, innovation potential, and more. It was called "Restoring the American Dream: Getting Back to #1". From my perspective, it was a rare and accurate assessment of American economic and social trends and big picture questions - rare for mainstream media that is.

Some of the analysis was done by Dr. Hans Rosling using Gapminder software, which Rosling helped to develop. It is a very cool tool to better understand how the world has been evolving over the last 200 years. The Zakaria piece is really worth watching because it cuts to the marrow of where we are as a society and provokes questions as to how we may have ended up in the socio-economic situation in which we find ourselves and how to bring about a new generation of innovation, investment, and development.

Sunday, February 26, 2012

Planetary Emergencies, Santorum, & Science

The American Association for the Advancement of Science had its annual meeting in Vancouver from February 16 to 20. A few revealing quotes from the meeting seem to have gone largely overlooked in the American press. According to James Hansen, a US climate scientist at NASA, "We have a planetary emergency, and very few people recognize that (emphasis added)." According to Andrew Petter, president of Simon Fraser University, "It's about persuading people to believe in science, at a time when disturbing number's don't." Both statements are remarkable. The public's decreasing belief that climate change is real evidences Petter's claim.

Even if we ignore casualty, climate change is real. Polar ice caps are melting; species are becoming extinct; and the pH of the oceans is falling. As it is, the scientific consensus, at least embodied in the the Intergovernmental Panel on Climate Change and among other research entities, is that human activities quite likely cause climate change. (According to NASA's reading of the IPCC's Fourth Assessment Report, the probability that human activities over the last 250 years have warmed our planet exceeds 90%.)

AAAS president Nina Fedoroff also made an interesting point: "Belief systems, especially when tinged with fear, are not easily dispersed with facts." The implication here is that people who reject science may reject it further as climate science presents them with scary facts. And the simple truth is that we should have fear - not paralyzing fear but healthy, natural fear. For instance, an upcoming article by Pierre Rampal, a researcher at the Department of Earth, Atmosphere, and Planetary Sciences at MIT, suggests that the IPCC estimates, which are themselves provocative, are actually too conservative.

Enter Santorum. I hesitate to single him out from other candidates but his recent statements are quite relevant. The former Senator and Republic presidential candidate recently in eastern Ohio said that "I refer to global warming as not climate science but political science." Another quote implied that President Obama maintains a "world view that elevates the earth above man." Elsewhere he has said: this "idea that man is here to serve the earth, as opposed to husband its resources and be good stewards of the earth - I think that is a phony ideal." Ignoring his use of language, he overlooks a) the idea that humans might have a mutually beneficial relationship with the earth and, more importantly, b) we aren't 'husbanding' earth resources.

If Santorum had any scientific training, he might step back and ask himself a few questions: Is man (or woman) above the earth? How can we be greater than that which makes us - at least on a physical level? Could it be that the very attitude that we are greater than the Earth is why we are in such trouble. These are not trivial questions; and I don't pretend to have definitive answers. But I wonder if Santorum has the ability to handle them with substance.

I believe in God. And I even believe that evil is probably getting stronger in the world (as is ignorance).* However, I also believe in science; and I know decisively that climate change and other environmental issues could soon define the 21st century just as science and technology defined the 20th century. Furthermore, I don't necessarily believe we need to look to administrative and state solutions to climate change as much as innovation-based and market solutions. It is also worth noting that just as people seem to ignore climate science, many ignore the evolving scientific knowledge of macroeconomics and financial economics when it comes to setting policy - a subject I will leave for another day.

Post Script: One of the concepts I do advocate with the option3 project is ability to look beyond rationality. There are many reasons why one might do this. I'll leave that subject for another day except to share this link, which sheds light on one set of conditions where rationality can break down.

* Post Script (November 2013): If evil is getting stronger so is its antithesis.

Friday, February 17, 2012

The Future is Now: Political Activation

UPDATE: This entry was reformatted for presentation on 12/31/14 and the Hawken quote has been added.  And the subtitle was added on 7/4/17.

For a long time, I have found valuable ideas missing (or perhaps still developing) from many economic and policy dialogues. As much as I see well-intentioned people in public policy and elsewhere, I find that our priorities, as Americans and Westerners in general, seem off.

How and why we have reached this point in history is not obvious. But clearly, inequality and instability are becoming the hallmarks of today. Furthermore, whether or not people in the United States want to admit it, the balance of power in the world is somewhat in play. It is not clear what the new pattern will look like; it's not even clear that nation-states themselves will come out on top.

Political Activation and the Information War

For the first time in history almost all of humanity is politically activated...global activism is generating a surge in the quest for cultural respect and economic opportunity in a world scarred by memories of colonial or imperial domination.
        Zbigniew Brzezinskiformer US National Security Advisor2008

Last March Secretary of State Hillary Clinton gave testimony before the US Foreign Policy Priorities Committee in the US Senate. The aim of the testimony was in part to secure funding for media outreach. She quickly made a number of points: i) the US needs to portray a more unified narrative, ii) alternative English-language news channels and websites have increasing readership and influence in the world, and iii) these sources focus on 'real news' rather than talking heads and pseudo-analysis. She also said in frank terms that we are losing a supposed information war. (It is worth noting that perhaps all governments are losing this war - not only the US.)  

Brzezinski's quotes affirm this thinking.  He is no Leftist.  This is Brzezinski.  In short, the jig is up; people increasingly understand how narratives and social construction have been used to manage and manipulate people throughout history.  The question of the future is not only political but also and more importantly economic. 

Economic Retool

The question today is whether democracies can thrive with financial systems that are out of control, that are capable of generating selfishly beneficial consequences only for the few, without any effective framework that gives us a larger, more ambitious sense of purpose.
        Brzezinskiformer US National Security Advisor2012

This is not an OWS protester speaking. Again, Brzezinski.  He goes on to say that we are living "without any larger conception about which direction our societies as a whole should be heading". I am not here to advocate central planning; hopefully neither is Brzezinski.  But we are in unfamiliar territory: no Cold War, a poorly delineated perpetual War on Terror, a collapsing middle class, fewer and fewer medium and high wage jobs, a weakening infrastructure, struggling education system, and an environmental situation which is misunderstood by all but a growing minority. While we need to balance our budgets over the long term and stay committed to real freedom and liberty, we are toying with calamity by not addressing big-picture questions. Top among those questions are the health of the economy and the environment.

Fortunately, we have an opportunity to re-tool our economic future by realigning the physical economy with the environment. Becoming a service economy serves only a minority of Americans. Physical production serves all Americans. Manufacturing 2.0, if you will, is the re-design and re-engineering of cars, buildings, and energy systems. Physical production generates income and jobs for average people, wealth for managers and owners of capital, and research institutions for the benefit of society.  Physical production is the very core and nature of development (as opposed to growth alone*), which will ultimately provide the resources to re-design how markets create and distribute food and medicine. Utopia is not possible. Aiming for greater stability and equality (of opportunity) are possible.

Unfortunately, we are not likely to make such changes with ease and certainly not soon. Introducing change in a system always creates new economic losers even if the net benefit is positive. The people who benefit from the existing order have so much to loose and so much influence on the people who live under them that change will produce enormous economic pain - subjective or not. Furthermore, change will alter the conveniences we all experience, which is hard for people today. We are not the sturdy people we were 500 years ago.


A New Operating System

[Y]ou are going to have to figure out what it means to be a human being on earth at a time when every living system is declining, and the rate of decline is accelerating. Kind of a mind-boggling situation... but not one peer-reviewed paper published in the last thirty years can refute that statement. Basically, civilization needs a new operating system, you are the programmers, and we need it within a few decades. 
        Paul Hawken, 2009

The rigidities of industrial food, fossil fuel, and conventional medicine along with the nexus of property taxes, public education funding, and institutional discrimination all together make significant policy change difficult.  As such, it may well remain that inequality will persist and worsen into future. But the environment is a very different issue. The environment that we all live in today distinguishes us from that of people living as recently as a 100 years ago in that the pace of environmental change is now possibly orders of magnitude faster than before; that claim is not based on climate change but rather on biodiversity, which is a key measure of environmental health. And some speculate that non-linearities in environmental systems may further hasten the speed of environmental change. From an abstract modeling perspective, the picture of chaos is not unreasonable.

Rationally speaking, I do not think we, as a race, will go much further without significant alterations to our numbers, our lifestyles, or our production strategies. We are due for change of some sort either within five years or 25 years. I doubt either our nation and our planet will make behavioral changes until serious suffering has begun at every level of society. However, when I resist the impulse to rely on rationality, I remember, that up to a certain unknown point, we always have options. If people choose food, construction processes, energy, medicines, and transportation goods and services that are clean, healthy and produced in less centralized fashion, anything can happen.

For more info visit my website option3.

* Innovation in the goods and services within the loanable funds market is a form of economic development. But such development is second in importance to development in physical production. In other words, in the super-long run, I value food and health over stocks and bonds. But I digress.