Now what - contemplating the market crash

You say "Americans deserve to hear much more detail about how the candidates would reform the financial system to prevent another crisis like this one."

I think we desperately need to expand the frame in which "this problem" is perceived. That discussion should precede solutions within that frame.

For one thing, this cannot be isolated to be a "financial system" problem. It involves other economic and social systems, including trust, social decision-making, governance, jobs, social safety nets, education, attitudes towards expertise, sources of blindness in how humans see the world, etc.

They are all tangled. They cannot be solved "separately", or put into a priority order. If there are 200 holes in the bottom of the boat, addressing the "three most important ones" doesn't really cut it. Causes, effects, symptoms, are in tangled feedback loops.

Most of all, I don't think that 200 bright people can "solve" this while the rest of the country and world watches TV, or that it will be solved by voting to pick the best of the two solutions they come up with in some back room somewhere.

A billion people are willing to help. How can that work? THAT's the question we should be addressing.

— Raymond, Detroit

See also:

Failure is perhaps our most taboo subject (link to John Gall Systemantics)

Active strength through emergent synthesis

Why more math and science are not the answer.

OECD PISA - Our education system should teach collaboration not competition

US - Economy of arrogance (and blindness)

Virtue drives the bottom line - secrets of high-reliability systems

High-Relability Organizations and asking for help

Secrets of High-Reliability Organizations (in depth, academic paper)

High-Reliability.org web site

Threat and Error Management - aviation and hospital safety

Failure is perhaps our most taboo subject (link to John Gall Systemantics)

Houston - we have another problem (on complexity and limits of one person's mind)

Institute of Medicine - Crossing the Quality Chasm and microsystems (small group teamwork)

Pathways to Peace - beautiful slides and reflections to music on the value of virtues

You say "No system can be smart enough to survive this level of incompetence and recklessness by the people charged to run it."

T.S. Eliot, writing in the last Great Depression, in "Choruses from 'The Rock'", said it well.

"They constantly try to escape
From the darkness outside and within
By dreaming of systems so perfect that no one will need to be good.
But the man that is shall shadow
The man that pretends to be."

===========================

MIT's John Sterman, in his book "System Dynamics - Systems Thinking and Modeling for a Complex World", describes how poor intuition is at predicting the behavior of "complex adaptive systems."

Books like Gene Franklin's textbook for control system engineering, "Feedback Control of Dynamic Systems" describe the universally applicable conditions for any system of any type to be stable, and I don't see them met or even discussed.

The only thing that seems CLEAR to me is that a whole new feedback loop has been added, responding with almost certainly short-range horizons to events that used to be decoupled and now that will be coupled by that unpredictable response.

We are way past the point where well intentioned humans can follow their "insight" and improve things with that strategy.

I have a number of relevant quotes from Sterman's book on my weblog post on the credit crunch that I made in August, 2007: http://newbricks.blogspot.com/2007/08/credit-crunch-reaches-larger.html and this post I made in January, 2007 on Jay Forrester's Law of Unintended Consequences: http://newbricks.blogspot.com/2007/01/law-of-unintended-consequences.html

At risk of running on, I briefly quote that paper: The classic paper in this field is Jay Forrester's congressional testimony: "The Counterintutive Behavior of Social Systems", http://web.mit.edu/sdg/www/D-4468-2.Counterintuitive.pdf

Quoting the abstract: Society becomes frustrated as repeated attacks on deficiencies in social systems lead only to worse symptoms. Legislation is debated and passed with great hope, but many programs prove to be ineffective. Results are often far short of expectations Because dynamic behavior of social systems is not understood, government programs often cause exactly the reverse of desired results.

==============================

=============

Reality-based Bailouts

I can imagine an economy in which there were no "banks" and businesses simply bought and sold shares in each other, or made loans to each other. That could work.

I cannot imagine an economy in which there were no underlying businesses, only banks lending (or not lending) money to each other.

The failure to realize which one is real and which one is an illusion will lead to ineffective strategies for national prosperity.

- rws

Loss of Trust on Wall Street and Main Street

(comment)

2008 12:35 pm

I think there is a more specific kind of "trust" that has been lost, not just banker's knowledge of individuals.

It is my clear impression, perhaps wrong, that decades ago there was a social norm of honesty and an ethic of hard work. Everyone didn't have an attorney who found loopholes, and people depended on having "a reputation" in the community, that they cared about, whether anyone was watching or not.

A man's record of honesty is what generated "trust" in the society, because he was, well, trustable.

These days it seems that the social norms have changed, and people in general certainly seem less "trustable" to keep their word, even when inconvenient or expensive to do so. Bankers do not trust other bankers. Countries sign treaties and then abandon them at the first inconvenience.

Some political advisors not only recommend dishonesty but seem to exult in their ability to be dishonest "successfully."

Political candiates seem willing to promise whatever suits them, or the crowd, at that moment, and seem to feel no obligation whatsoever to do what they promised before being elected. The idea seems strange that they should be, in any way, "held to" what they promised.

Without THAT kind of trust, no one is willing to make any sort of verbal deal with anyone else for anything. No politician is willing to give away X now in exchange for a promise from another politician to give back Y later. The promise, which used to be disaster to violate, now seems to have no weight at all.

Not too surprisingly, by discounting the past and wantonly disregarding the future, there is very little room left to negotiate in "this instant."

Maybe rich people never trusted each other, and they certainly never trusted poor people - but many poor people actually do trust each other, surprise. Many communities are places where neighbors don't lock their cars or their doors. [see note]

That worked. This doesn't.

=============================
[note: - Michael Moore noted in one of his movies the amazing distinctions crossing the river from Detroit Michigan to Windsor Ontario, heading South. (check the map, yes, South.) In much of Windsor, people don't lock their houses. Moore interviewed one person and asked if they had ever been robbed. Yes, they had. So now do they lock their house? No, "it would just feel wrong." ]

Re Rescue the Rescue ( Friedman, NYTimes)

You say "No system can be smart enough to survive this level of incompetence and recklessness by the people charged to run it."

T.S. Eliot, writing in the last Great Depression, in "Choruses from 'The Rock'", said it well.

"They constantly try to escape
From the darkness outside and within
By dreaming of systems so perfect that no one will need to be good.
But the man that is shall shadow
The man that pretends to be."

It's worth reading the whole thing. There is a huge amount of content and reflection there.

"But you, have you built well,
that you now sit helpless in a ruined house?"

It is very hard to find the entire poem online, so here's a link to a copy in google books.
http://books.google.com...

— Raymond, Detroit

response to Nihilist's Revolt - Bailout Plan

30, 2008 4:13 am

Let's take this pause to examine several alternative "frames" for "this crisis", and what candidate solutions each one would suggest. In every case except psychological, we need to distinguish perceptions from reality.

One view is that something has "broken" in the global system to extend credit to responsible borrowers, and it needs to be "fixed." Perhaps what has broken might break more, and we need more attention and adrenaline.

A different lens would say that the credit business is a symptom, not a "root cause." What is broken is psychological, a global sort of unjustified panic, and what we need is to calm the panic and then everything will be fine again. Actually, less attention and way less adrenaline would be good in this scenario. "Nothing to see here folks, false alarm." A calm voice, a firm hand on the helm, a sense of authority would be good, we can all go back to watching television.

A third view is that this is a crisis of "social capital." In that view, what has bottomed out is "trust" and delayed gratification. What has replaced those is distrust and a "me first, right now" mood.

Psychological issues and passing unjustified anxieties can be calmed by the media - although the voice from the box seems to be crying "panic now!" Financial systems might be improved with more "regulation", or possibly by letting American ones fail and relying more on global ones with less credulity that are still strong.

But the issue of a sudden realization that we have no social capital left remains. To the extent this is the root cause, we have a much different problem here, calling for different solutions.

This seems to me to be the case, as each year's Federal Budget takes longer and longer to get passed, with bickering and paralysis replacing negotiation and reasoned discussion and even horse trading.

Negotiation and deals require trusting the other party to keep their promises, and that seems to be gone.

If that is the problem it is a huge one, and the wrong parties are at the table. All those social scientists and all those subjects we've been throwing out of the curriculum because they were not "math" or "science" are more relevant than high finance. We need cultural anthropologists. We need to understand the role of religion and morality in building trust in the future, and, for that matter, a thought for the future in present decisions.

The bailout bill will not address this latter problem. It's the wrong frame.

Before solving the problem in one frame, let's be sure it's the right frame, and that we're solving root causes, not symptoms, because there's not much ammo left in the box. There's only so many more trillion dollar rescue plans before we are, sadly, broke.

Political Grace

this from the Wall Street Journal: (Peggy Noonan):
=======================

Veer

Where is America?

America is on line at the airport. America has its shoes off, is carrying a rubberized bin, is going through a magnetometer. America is worried there is fungus on the floor after a million stockinged feet have walked on it. But America knows not to ask. America is guilty until proven innocent, and no one wants to draw undue attention.

America left its ticket and passport in the jacket in the bin in the X-ray machine, and is admonished. America is embarrassed to have put one one-ounce moisturizer too many in the see-through bag. America is irritated that the TSA agent removed its mascara, opened it, put it to her nose, and smelled it. Why don't you put it up your nose and see if it explodes? America thinks, but does not say.

And, as always America thinks: Why do we do this when you know I am not a terrorist, and you know I know you know I am not a terrorist? Why this costly and embarrassing kabuki when we both know the facts, and would even admit privately that all this harassment is only the government's way of showing that it is "fair," of demonstrating that it will equally humiliate anyone in order to show its high-mindedness and sense of justice? Our politicians congratulate themselves on this as we stand in line.

All the frisking, beeping, and patting down is demoralizing to our society. It breeds resentment, encourages a sense that the normal are not in control, that politics has lessened everything, including human dignity. Another thing: It reduces the status of that ancestral arbiter and leader of society, the middle-aged woman. In the new fairness, she is treated like everyone else, without respect, like the loud ruffian and the vulgar girl on the cellphone. The middle-aged woman is the one spread-eagled over there in the delicate silk blouse beneath the removed jacket, praying that nothing on her body goes beep and makes people look.

Getty Images

Hail to the Candidates

The 2008 presidential campaign has generated a range of original songs.

• Read more about the tributes and listen to clips from some of the numbers.

America makes it through security, gets to the gate, waits. The TV monitor is on. It is Wolf Blitzer. He is telling us with a voice of urgency about the latest polls. But no one looks up. We are a nation of Willy Lomans, dragging our wheelies through acres of airport, walking through life with a suitcase and a slack jaw, trying to get home after a long day of meetings, of moving product.

No one in crowded Gate 14 looks up to see what happened with the poll. No one. Wolf talks to the air.

Gate 14 is small-town America, a mix, a group of people of all classes and races and ages, brought together and living in close proximity until the plane is called. Our town appears, the plane is boarded, the town disappears. An hour passes, a new town begins. This is the way of modern life. We live in magic and are curiously unillusioned.

Gate 14 doesn't think any of the candidates is going to make their lives better. But Gate 14 will vote anyway, because they know they are the grown-ups of America and must play the role and do the job.

But here's something they notice, we notice. Our leaders are now removed from all this, removed from life as we live it each day.

There is as I write broad resentment toward President Bush, and here is one reason: a fine and bitter sense that he has never had to stand in his stockinged feet at the airport holding the bin, being harassed. He has never had to live in the world he helped make, the one where Grandma's hip replacement is setting off the beeper over here and the child is crying over there. And of course as a former president, with the entourage and the private jets, he never will.

Nor will Bill Clinton, nor the senators and leaders who fly by private jet.

I bet a lot of Americans, most Americans, don't like it. I'm certain Gate 14 doesn't.

Giacomo Marchesi

All this is part of the mood of the moment. It is marked in part by a sense that our great institutions are faltering, that they've forgotten the mission; that the old America in which we were raised is receding, and something new and quite unknown is taking its place; that our leaders have gone astray. There is even a feeling, a faint sense sometimes that we have been relegated to the role of walk-on in someone else's drama, that as citizens we are crucial and yet somehow...extraneous.

But we are Americans, and mean to make it better. We long to put the past few years behind us, move on, and write something good on the page we sense turning.

In all this I am not saying, as Rodney King did, Why can't we all just get along? We can't because we're human: something's wrong with us. But we can do better.

I don't mean "we must outlaw politics," or "splitting the difference is always best." Politics is a great fight and must be a fight; that is its purpose. We are a great democratic republic, and we struggle with great questions. But we can approach things in a new way, see in a new way, speak in a new way. We can fight honorably and in good faith, while -- and this is the hard one -- both summoning and assuming good faith on the other side.

To me it is not quite a matter of "rising above partisanship," though that can be a very good thing. It's more a matter of remembering our responsibilities and reaffirming what it is to be an American.

If nothing else, this means we must now have our fights over big issues, issues of real consequence that are pertinent to the moment we're in. We shouldn't be fighting and hitting each other over the head over little things, stupid things, needlessly chafing ones. When I would think of this the past few years I'd always return to one thing, a prime example of the old way of doing politics. This was the movement, now quiescent, to alter the Constitution of the United States to outlaw...flag burning. Imagine changing that great document for such a stupid thing. As if it meant anything if an idiot burned a flag; as if a lot of idiots were even burning flags -- which they weren't, and aren't. I called it a movement, but of course it wasn't: it was a political game played by one team in order to embarrass the other. "He doesn't love our flag -- he won't even protect it!" Boo! goes the crowd.

And yet the oddest thing is...the crowd knows it's being played. They know their buttons are being pushed. And this doesn't leave them feeling more inspired by, more trusting in, the system. So much of our silliness is, in the end, destructive.

And so I came to think this: What we need most right now, at this moment, is a kind of patriotic grace -- a grace that takes the long view, apprehends the moment we're in, comes up with ways of dealing with it, and eschews the politically cheap and manipulative. That admits affection and respect. That encourages them. That acknowledges that the small things that divide us are not worthy of the moment; that agrees that the things that can be done to ease the stresses we feel as a nation should be encouraged, while those that encourage our cohesion as a nation should be supported.

So where are we now? I yank this into the present to look at the landscape on which a rise to the challenge is possible, but not, I'm afraid, very likely.

Veer

It is autumn, and America is picking a president. It has been exciting. The whole year was confounding, putting the professional political class in its place, leaving the experts scratching their heads, and giving us all the feeling -- so precious, so rare -- that the people are in charge. They make the decisions, not pollsters. And you never knew what they'd do next. John McCain was over and done a year ago, out of money and out of luck. And then: he wins the nomination. Barack Obama was unknown and outmatched a year ago, sure to be a victim of someone else's inevitability. Well. Nothing is inevitable. And he wins the nomination.

A year of marvels. And now two men, McCain and Obama, each worthy in his way of admiration, battle it out. Neither seems by nature inclined toward brute, gut-player politics. One, McCain, had been hurt by it in the past, his presidential prospects in part done in by it in the Republican primaries of 2000. He has a temper, and at some point he'll have shown it, but the ugly road, I think, embarrasses his pride. The other, Obama, seems temperamentally not inclined to be a killer, to encourage the dark side of politics. It's not his history: he took down a machine without raising his voice.

However.

Something tells me that the election will show itself to be rough indeed, if not because of the candidates themselves then very much because of their surrogates or would-be surrogates -- a million freelancers and operatives, YouTube Fellinis, and political action committees.

Two huge teams are in a massive public brawl in an era in which the Internet has liberated everyone in the country from the old restrictions, the old establishment, the old, encrusted media monopoly.

YouTube has yielded, this year, the most moving and wittiest advertisements about each of the candidates. Professional political consultants with their piece of the buy didn't produce them, artists did. For Obama, it was the video by will.i.am, with the Obama speech and the snatches of song made from his words. More than anything else this year, it captured the feeling behind his movement. The McCain video, alas, was anti-McCain, and keyed off the will.i.am video. It featured young people and artists taking snatches of McCain speeches, turning them into song, and then starting to...freak out as they listened to the words. It made you laugh out loud. Anyway, one of the untold stories of the year is the failure of the political professionals to compete with the art and brightness of the nonprofessionals.

All of this will be part of the background music of the 2008 campaign. So: it's probably gotten mean out there.

And of course it is not only the result of technology, and partisanship, and human mischief. Some of it has been the result of the past seven years, that trying time with which we have not fully come to grips. Some of the personalities and circumstances that shaped the era are about to ease off the stage. In some way we're about to turn the page. Maybe John McCain or Barack Obama can help us write something good on it.

Yet the economic crisis brings a new question, only recently being articulated, and I know because when I mention it, people go off like rockets. It is: Do you worry that neither candidate is up to it? Up to the job in general? Is either McCain or Obama actually up to getting us through this and other challenges? I haven't heard a single person say, "Yes, my guy is the answer." A lot of shrugging is going on out there. The big shrug is a read not only on the men but on the moment.

The overarching political question: In a time of heightened anxiety, will people inevitably lean toward the older congressional vet, the guy who's been around forever? Why take a chance on the new, young man at a time of crisis? Wouldn't that be akin to injecting an unstable element into an unstable environment? There's a lot at stake.

Or will people have the opposite reaction? I've had it, the system has been allowed to corrode and collapse under seven years of Republican stewardship. Throw the bums out. We need change. Obama may not be experienced, but that may help him cut through. He's not compromised.

The election, still close, still unknowable, may well hinge on whether people conclude A or B.

—Adapted from "Patriotic Grace: What It Is and Why We Need It Now," by Peggy Noonan. Copyright 2008 by Peggy Noonan. Published by Collins, an imprint of HarperCollins Publishers.Peggy Noonan is the author of seven books. This is adapted from her next book, "Patriotic Grace," which will be pu

Clueless, says NY Times Op Ed

My Comment on NYTimes op-ed piece.
==========================================
Desired comment:
==========================================
Curious logic, both of you. Let's separate economics from politics and problem from solution and fall back on basic principles.

To paraphrase Bertand Russell, when experts disagree, you cannot be sure any
position presented is correct. We don't even have recognized and trusted experts. The activity proposed is unorthodox, if not unprecedented in this country, so even experts admit we are in uncharted territory.

What are we sure of? Enough, it turns out, to reach a conclusion.

Is there a crisis? Yes.

Does anyone comprehend all of the national and international aspects of the crisis, its full scope and scale and character, and all the players involved? No.

What are the odds that complex, interconnected systems with huge stakes are capable of behaving unexpectedly, even paradoxically, as well as generating unintended and unanticipated "side-effects"? 100 percent.

So, how many people in the world, after extensive study and modeling, could reliably predict all the significan teffects of any of the proposed interventions? None.

Then, how many people in the world, after incomplete study, little discussion with experts, and no simulation or modeling, could reliably predict all the significant effects of the proposed solutions? None.

So is it possible ANY proposed solution would actually make things worse, not better? Yes.
Is our intuition a good guide to behavior of complex adaptive systems with feedback? Demonstrably no. John Sterman at MIT and others have demonstrated that even simple feedback baffles most people and their predictions, while confident, are well off the mark.

If we cannot reliably predict the outcome, then how good a track record do we have in quickly realizing and admitting that a course set out upon is not looking good, or in fact, should be rejected after all? Sadly, history suggests continuation of even blatantly failed policies is human nature.

If it turns out to be the right direction, are we sure we are going far enough? No.
Is it possible the true final cost might be well larger than initial predictions? Yes.,

if this turns out to be the wrong direction, is it relatively easy to undo? No.
Is it possible to undo at any cost? Not clear.

Would an attempt to undo it result in yet another case where we are spending most of our effort trying to undo the impact of prior, ill-conceived "solutions"? Yes.

Are well all very good at recognizing when our help is only making things worse? No.

If someone else was doing this in a parallel economy, say on Mars, that we had no stake in, what would we think the odds are that their first intuitive guess as to an obvious solution is, in fact the solution? I think, very low.

Does having a strong vested interest, and a sense of panic, improve human judgment and decision making? Not generally, no.

All of this comes together to say that the a priori odds that any solution proposed will solve the crisis are very low, close to zero. It may be the same odds that you could fix a broken television by reaching inside and cutting the obvious wire, and we're arguing over which wire is the obvious one.

If we take this action, and it doesn't work out, how many more such tries do we have? Not many, at that price tag. A failed attempt not only fails to solve the problem, it uses up limited ammunition andt time.

Now, this is hard but try. Aside from political considerations, and group psychology, are we more likely to improve things or to cause yet more damage by any such large-scale action? I have to conclude from the above that carefully-considered inaction is more defensible, safer, and stabler than (re)action, politics aside.


======================= actual comment ======================

• 
  
• 72.
  September 26th,
  2008
  8:23 pm

  A drama in one act:

  * Pilot?! The wing is on fire!
  Yep, seems to be.
  * Should we dump fuel?
  Well, it might be the exact wrong time to do that.
  * Don’t we need to do something?
  Yes.
  * So we dump fuel?
  No, that would just catch fire from the wing and cause the airplane to explode.
  * But it’s the only suggestion we’ve come up with and we need to DO something NOW!
  OK, then I’ll put the airplane into a dive and go so fast that the wind blows out the fire, as it says in the manual.
  * NO, we want to stay UP!

  The crowd of passengers forcibly removes the pilot and pushes the fuel-dump button.

  The end.

  — Posted by Wade

=========================================================

OK, now bring politics back into this picture. Do the American people tend to support carefully-considered inaction? No. Do we care what the American people think? Both journalists say "No." That's a story in itself, but for another day.


Wade

Yes, yes! A Bailout Plan at Last!

All this talk and no one has addressed how they intend to value junk, if we don't use a market.

So I will offer a plan. Then we can look for any better plans.

Here's my plan = "The Plan version 1.0" :

How about they start by offering to buy at 1 cent on the dollar any existing mortgage backed debt anyone, individual or corpation wants to sell?

When no one offers to sell any more, raise that to 2 cents on the dollar.

Keep going, adding 1 cent per dollar a day to the offer, till the $700 Billion is invested.

Advantages:

* Comprehensible plan of action.
* No questionable computations.
* No charges of favoritism.
* Easy to audit
* And, I think, most subtly but most importantly, is that this would have an immediate calming effect on the market, and one that improved gradually over time.

After the first day, you may not know how much that junk in the vault is "worth" but you and everyone else knows that you think it is at least 1 cent per dollar. Each day its effective worth gets both larger and stabler, in a gradual fashion.

The advantage, to anyone who grasps complex adaptive systems, is that no abrupt "step-function" change is put into the market, which would reveal and trigger all manner of new instabilities and demons. The firm hand gets slowly firmer, the ones most in panic get resolved the soonest, and things simply get better over time.

* Oh, and it probably is defensibly prudent - the investing public gets the most face amount of junk assets it possibly can for each dollar invested.

* In fact, there could be a market in this pool of dubious assets being collected, which could bring in more cash and make the entire plan become self-funding after some point.

* Probably, just issue each American Citizen 2,500 shares of stock in this junk-asset holding agency, in exchange for the non-optional investment of $2,500 of their money being taken on as US debt. If people want to hold the shares they can, or they can sell them to anyone else who wants to buy them up. If this thing makes money, all US citizens make money. If it loses, hey, that was in the cards regardless, then.

===
OK. Next? Who has a better plan than that?

No No, a Thousand Times No!

To address the problem we need to grasp the nature of the problem, a task that seems to have been largely overlooked.

Let's look at the whole question known as "stability" and "health" of the financial sector, and reason from solid underlying basic principles that govern all complex adaptive systems, caring as little as does gravity about politics and winners and losers.

As I have stated numerous times in the past, there is expertise in the world regarding what is involved in stabilizing a system, any system. There are universally applicable principles. This field is called "Control System Engineering". The principles are the same whether the system is a jet aircraft in flight or an economy in motion.

Probably the first thing that needs to be said is that "intuition" as to what to do is uniformly wrong. Our intuition is based on very simple systems, almost uniformly lacking feedback, or having consequences we have carefully built a narrative allowing us to ignore.

This sin is equivalent to designing a car so complex no human can drive it, and then blaming the drivers for the subsequent crashes, instead of blaming our own design.

So, doing the "obvious thing" is almost always the wrong answer. This does not depend on how stridently one asserts that it is "obvious" or what caliber gun one can point at the head of those who disagree with one's "obvious" brilliant insight into a system no one else can fathom. It is, after all, "obvious" only if you ignore all the parts that don't work, and focus on the few parts that
do.

There is an entire science of "stability" and a whole field of designing "controllers", electronics that can provide such stability to a given engine or system. Even to those with PhD's and a lifetime experience, the solutions that the computers reveal are seldom "obvious".

We need now to make an extremely important distinction and disentangle two concepts that are generally incorrectly mushed together.

One is the concept of "being under control" and the other is the concept of "controlling".

It is desirable that systems we rely on, drive in, fly in, or put our offices within are "stable" and "under control." The alternative is bridges, planes, or economies crashing down with significant loss of life and treasure.

That said, how the "controlling" occurs, and what the agent is of such controlling, turns out to be a more complicated issue that we are used to.

Let's consider some alternatives. There is the "great man" or "king" or "Czar" approach, in which a single human, possibly with or without advice, uses his great wisdom to decree each step in turn in order to bring about stability. If there is no stability, the solution is either "more wisdom" (seldom mentioned) or "more authority" (a far more popular request.)

On the far side, there is a more complex type of agent, spread more diffusely, hard to see on a small scale, but easy to see on a large scale. One example, and mind you this is only one, is the "Invisible hand of Adam Smith", or the functioning of a "free market."

This is just one example of millions of possible "emergent agents" that brings about stability, often in a way baffling to humans, or incomprehensibly difficult for humans to fathom. One example often cited is the set of decisions involved in feeding New York City on a daily basis.

The conservatives have it right, that some kind of emergent agent can be far more powerful at setting things right and repairing instability than can any single local human with their local perspective. What they have wrong is that there is only one such solution, so they don't put in the time and effort to find one BETTER than Adam Smith, but still not in the hands of any small clique of people, regardless how sincere, who as all humans do, will lose all sense of perspective once they gain power, and who will therefore spend all their assets attempting to acquire more power, which they incorrectly think will finally solve things. It is so "obvious" to them that the solution is close, if only they had complete control.

The problem with this logic is that other people are only part of the obstacle. Another obstacle is that complex systems have a mind of their own and do not behave in a manner comprehensible to a human, or predictable by a human, any human, regardless who they are. the only reason it seems that it is close to such a Nirvana is that all of the things not understood have been diminished and discarded. So, all the points I have kept on this graph form a straight line, see? (of course, I had to discard all those that didn't fit my preconceived notion that there is in fact a line here, not a sine curve or something more complicated.)

Ok, so, say for a moment you had 100% of the world budget, 100% of the world in worshipful obedience, and total authority. Then what?

It's not like the world has a steering wheel and only needs to be brought back onto the road, now that we've decided who's driving. The world is more like a 747, and we are more like 6 year olds, and having total authority to push buttons does not a pilot make.

The only solution remaining for us is to find a type of distributed emergent agent, like Adam Smith's hand only better, that can be created using simple decision rules, such as "be greedy", and that collectively form a stabilizing field.

My perception is that "be greedy" as a generative rule is not a very good solution and "be nice" is a better one. Before concluding such a solution is impossible, we need to study the role of context in making behaviors occur and sustaining them in the face of apparent results.

That is the task that we should be putting 700 billion dollars into, not fighting over WHICH human should make 'the decisions",

Wade

We need an improved "invisible hand", Adam

David Brooks wrote a piece in the NY Times this morning on regulation of the financial industry.

Incidentally, there is essentially no engine today in any product that does not have a "controller" as part of the design, to increase stability, response time, etc. No elevator would stop at the floor without an abrupt "jerk" without a controller. The design of such controllers is in the field called "Control System Engineering."

A sample text book is this one: Feedback Control of Dynamic Systems, by Franklin, Powell, and Emami-Naeini. These are the concepts we need for a "governance" or "regulatory" system that actually works as advertised.

Control system engineering is to complex systems what "civil engineering" is to automobile bridges across rivers -- it is completely general and non-political, it won't tell you where to build or what to build with, but it WILL tell you the required properties of the materials and that some things will simply not work. You can't build the Brooklyn Bridge out of plastic, for example, regardless how cheap it is. You can't design a regulatory system that depends on feedback, for another example, and then blind the sensors that are supposed to determine the feedback.

The advantage of such engineering is that it focuses on issues such as "stability" (a big one right now) and gives power to insight, such as that blinding the eyes of a system will make it drive off the road for sure.\

Search "feedback" or "system thinking" in this weblog for other posts on such matters!
====================================================


One obstacle to a good solution is the incorrect assumption that a process "under control" equates to a small group of people doing "the controlling." Let's keep those separate.
The question of whether we need more "governance" should be distinct from who, or what, should be the active agent. For much of the US History, many have favored Adam Smith's "invisible hand" of the marketplace to do this controlling.
The classic debate over more or less "government" desperately needs this distinction.
The question should be whether there is an improvement on the class of "invisible controllers" that (a) do a better job and (b) are even less corruptable by those who would hijack the process.
There is no question that we have very complex processes running out of control, and that this is not the preferred state. Fine.
The question is how to achieve the "under control" part. The institution called "government" has typically decayed to "a few people" who, regardless of wisdom and intent, have been unable to grasp the com
plexity of the beast or improve on its operation and results.

The deep cynicism resulting from such failure seems related to the abandonment of a goal of prosperity for all and replacement with a goal of "prosperity for me and my friends at everyone else's expense" which turns out to be a short-term illusion, given how interconnected everything is.
These are problems in the area of "control system engineering" and "complex adaptive systems" and the necessary insights are probably in those fields.

Why more math and science are NOT what we need

I had a post recently, the link I'll add here soon, in which I protest the emphasis on math and science education in our schools, because, I believe, that is not where things are breaking.

For example, I really don't believe that if every Senator had more math and science, or even, say, twin PhDs in math and science, that they would be any better at reaching consensus than Oxford University professors are at deciding what e-mail system to purchase.

The reason is that all this "math" and "science" takes place in a social context that can magnify or neutralize or reverse essentially anything.

The following piece from today's New York Times makes it clear that having computers and "quants" doesn't really solve much. As I continue to repeat T. S. Eliot, they continue "dreaming of systems so perfect that no one needs to be good." It won't ever happen.

================================================

September 18, 2008, 7:52 am — Updated: 5:00 pm -->

How Wall Street Lied to Its Computers
By Saul Hansell
CORRECTED 5 p.m.: Spelling of Leslie Rahl.

So where were the quants?

That’s what has been running through my head as I watch some of the oldest and seemingly best-run firms on Wall Street implode because of what turned out to be really bad bets on mortgage securities.

... I got to know bunch of quantitative analysts (”quants”): mathematicians, computer scientists and economists who were working on Wall Street to develop the art and science of risk management.

They were developing systems that would comb through all of a firm’s positions, analyze everything that might go wrong and estimate how much it might lose on a really bad day.
We’ve had some bad days lately, and it turns out Bear Stearns, Lehman Brothers and maybe some others bet far too much. Their quants didn’t save them.

I called some old timers in the risk-management world to see what went wrong.

I fully expected them to tell me that the problem was that the alarms were blaring and red lights were flashing on the risk machines and greedy Wall Street bosses ignored the warnings to keep the profits flowing.

Ultimately, the people who ran the firms must take responsibility, but it wasn’t quite that simple.

In fact, most Wall Street computer models radically underestimated the risk of the complex mortgage securities, they said. That is partly because the level of financial distress is “the equivalent of the 100-year flood,” ...

But she and others say there is more to it: The people who ran the financial firms chose to program their risk-management systems with overly optimistic assumptions and to feed them oversimplified data. This kept them from sounding the alarm early enough.

Top bankers couldn’t simply ignore the computer models, because after the last round of big financial losses, regulators now require them to monitor their risk positions. Indeed, if the models say a firm’s risk has increased, the firm must either reduce its bets or set aside more capital as a cushion in case things go wrong.

.... Wall Street executives had lots of incentives to make sure their risk systems didn’t see much risk.

“There was a willful designing of the systems to measure the risks in a certain way that would not necessarily pick up all the right risks,” said Gregg Berman...
...

But since the markets were placid for several years (as mortgage bankers busily lent money to anyone with a pulse), the computers were slow to say that risk had increased as defaults started to rise.

It was like a weather forecaster in Houston last weekend talking about the onset of Hurricane Ike by giving the average wind speed for the previous month.

But many on Wall Street did even worse, as Mr. Berman describes it. They continued to trade very complex securities concocted by their most creative bankers even though their risk management systems weren’t able to understand the details of what they owned.
...

So some trading desks took the most arcane security, made of slices of mortgages, and entered it into the computer if it were a simple bond with a set interest rate and duration. This seemed only like a tiny bit of corner-cutting because the credit-rating agencies declared that some of these securities were triple-A. (20/20 hindsight: not!) But once the mortgage market started to deteriorate, the computers were not able to identify all the parts of the portfolio that might be hurt.

Lying to your risk-management computer is like lying to your doctor. You just aren’t going to get the help you really need.

They would have gotten things right if only they were fed the most accurate information. Ms. Rahl said that it was now clear that the computers needed to assume extra risk in owning a newfangled security that had never been seen before.

“New products, by definition, carry more risk,” she said. The models should penalize investments that are complex, hard to understand and infrequently traded, she said. They didn’t.

“One of the things that has caused great pain is complex products,” Ms. Rahl said.

....And, ultimately, the most important risk-management systems are the ones that have gray hair. “It’s not just the Ph.D.’s who must run risk management,” Ms. Rahl said. “It is the people who know the markets and have lifelong perspective.” And at too many firms it is those people who failed to make sure the quants really did their jobs.

(c) 2008 the New York Times Company

Musings on the nature of prayer

If we simply take the concept that psychological context has a great deal of impact on both the results of thinking and the results of actions, then there is a place in our model for what religions call prayer. It's not a full match, but it is close enough to some aspects of prayer and meditation to be interesting.

Given that a billion people or so have reported success with prayer in some manner, it does seem worth investigating whether they are all deluded, or whether something is going on.

This context model does not require "God" in order to work. It simply says that if you can get yourself in some way into the right reference frame, with the right mental model of what is going on, that your outcomes will be better, as measured by you and as measured by the people around you and your organization, tribe, family, culture, nation.

That much is worth clinical study. There are good solid reasons in simple physics (well, General Relativity) for why context matters and there is already mathematically sophisticated equipment for analyzing and modeling this. At the current time this is not generally accessible, but computer front ends could easily do for this what they have done for statistics, namely, make the arcane suddenly available for use (and misuse) by the normal scientist.

The same is true for feedback effects and modeling situations involving feedback.

I am fairly certain that, if there were tools on the market that made analysis of feedback as easy as SAS or SPSS or Stata make analysis of regression, or Excel makes analysis of budgets, the psychological resistance to the idea would suddenly evaporate.

(Sadly, the field has not yet had the equivalent of Sir R. A. Fisher, to define the basic statistical tests so that everyone else can use them with only vague comprehension of what they do and how they work. And, there is not a stable / pool of feedback-icians one can assess or hire or build into the grant, or a Feedback-Effects-Core one can go down to and ask for assistance. Again, the existence of these would remarkably reduce the resistance to considering whether this is a valid construct or not.)

In any case, in a "weak hypothesis", a person doing a good job of psychologically putting themselves back into a strong social context should be observably different from a person who does not do that, even if this is "all in their head." That would be measurable.

In a "strong hypothesis" there is more going on in the world here than simply what is happening "inside the person's head." Odds of various outcomes are changing.

It is not necessary to buy the strong hypothesis to study the weak one. If there are in fact effects that cannot be explained by it, they will show up.

And, if scientists want to "debunk" the power of prayer, then it would be a marvelous move if they came up with something that worked even better.

So far, they neither accept that challenge nor have delivered something that works better for the average person than prayers of submission and reconnection.

"Reason" is put forward as the answer to everything, but it is remarkably devoid of motivational power or of regenerating a depressed spirit. Maybe psychoactive drugs is the solution suggested?

Beyond Reason to Action

(continuing a series of posts in the last 3 days on "reason")
===========================================

There is one additional problem with "reason" that I have not mentioned that is immediately relevant, and that is that "reason" is so "academic."

What I mean by that is that reason has, by itself, absolutely zero action component. One could "reason" all day, or a million years, and it would never affect any external thing one whit.

In the real world, the one academics avoid, there is no point in thinking about something if you aren't contemplating action of some kind.

So, I just discussed the idea that the context in which we think or reason has an impact, and alters the outcome of such reasoning. The mechanism for this is pretty obvious, once you think about it.

However, context has a different function as well. We are, after all, cybernetic organisms. We perceive the world, map that into some model, determine some action to initate, initate it, and quickly repeat that loop endlessly, attempting to converge on some goal.

So my point is that context influences, and may alter or determine the outcome of any action.

One very specific context I have in mind here is the intention of the actor, assuming the actor is human. Along with that context, and mixed into it, is the mental model, i.e. framework, i.e. meaning associated with this action and possible outcomes.

So, it matters "what we think we are doing" in addtion to what we are doing. More specifically, what we think we are doing is in fact part of what we are doing, and colors it in some manner, almost epigenetically, as methylation states color genes on DNA.

This effect has anecdotally been reported by a great many people over the past several thousand years.

An example of this was the story I told, probably made up, of two stone-masons working in a Medieval church construction. One was doing poor work and one great work, and the supervisor went to see what was going on. He asked the one doing shoddy work what he was doing, and he replied, as if it was obvious and what a dumb question, "Building a wall."

Then he asked the one doing great work what he was doing and that mason replied, again as if it was obvious and a dumb question, "Building a cathedral."

Clearly, and probably undisputed, the meaning with which a human holds an action influences the outcomes of that action in many ways.

What is surprising is what a powerful effect this seems to be, even in cases where you cannot see how the work itself is being influenced, but you can observe the overall outcome.

Here, like M. C. Esher's waterfall in some cases the large-scale outcome of building a cathedral is a cathedral, and the outcome of "building a wall" is nothing.

The same seems to be true in software engineering. The mechanism is not clear here, and one would think that "Java is Java." Yet, seemingly good code written by angry people works less well than similar appearing code written by happy people.

It is not clear exactly how the mood gets under the skin of the program, but to myself, and to some other senior IT people I discuss this with, this effect is very real, and they know immediately what effect I'm talking about.

In any case, I wanted to open up the door for further discussion about the failings of pure reason, and one of them is that humans are never pure anything, and so being reasonable, even being able to totally prove one's point, is not necessarily a good guide to the outcomes of action. It is an often necessary but also often not a sufficient criteria.

The busy executive who has his secretary buy flowers for his wife, versus one who buys them himself, may find a very different result once he gets home.

It is not my point to analyze all the possible pathways and mechanisms involve here. My point is to raise another dimension in which pure reason, by itself, is insufficent for daily living, and not a very good guide to action.

Certainly, for every one of the cases I mention, something can be defined as the locally causative agent. I am asserting that if it wasn't that agent, it would have been another one, because the actual cause of the outcome is only expressing itself through whatever is handy. We need to look further upstream to actually see what is going on.

The difference, incidentally, is not just in the external world. The meaning of some action or activity greatly influences the ability of someone to carry it out, and affects how they feel afterwards - exhausted or elated.

Again, to understand what is going on we have to look beyond "content" to "context" to get a complete picture. I'm asserting that it matters to more than a court of law. It matters to phsyiological outcomes in the body of the person acting. It matters to the impact of the action, seen from afar, on the outside world.

It is as if, mentally connecting an action and a larger game plan or framework of meaning somehow completes BOTH the action and a little bit more of the framework's agenda than would have occured otherwise. The effect may be "negligible" locally, but over time, it can accumulate to something and even accumulate to totally dominate the resultant, seen from afar.

The key point here is that this effect which I allege, anecdotally, is not within the realm of "reason" for action. Listing the reason for an action is a dormant activity. Having an intent is very different.

Let us suppose for a minute that this is true. The advocates of reason would argue that such "emotional" content is baggage, in the way of a pure life, and should be discarded. I would argue that this "intent" or "will" thing is, in fact very real, and very important, because not only can it be a thing that destroys a desired outcome -- it can be the only thing that can create a desired outcome.

Great victories are never won on the basis of "reason". If that is true, then we should be paying attention as well to something else, or we might redefine (reason + something else) as "reason-2.0".

Wade

more problems with reason

A profound and relevant insight was shown in a Charles Schulz "Peanuts" cartoon strip one day.
Snoopy, the beagle, is lying on top of his doghouse and pondering. He says...

"Did you ever notice,
that if you think about something at 2 AM,
and then again at noon the next day,
you get two different answers?"

Snoopy manages to capture one of the problems with reason, as practiced today - namely, both the meaning of "facts" and the outcome of logical reasoning are context sensitive.

"Reasoning" alone is not sufficient. One has to track not only the math of how the contents relate to each other but also how the contexts relate to each other.

Probably this would require a new kind of computer which was a context processor, not a contents processor.

This is a very familiar problem in Einstein's General Relativity, and it is not insurmountable.

It is also a familiar problem to any mediator or serious negotiator, who knows that the meaning of a phrase or word or step is highly dependent on context.

In Relativity, it is clear that perceptions are a very specific combination of something which might be observed, and some type of distortion of the observer's measuring equipment. This means that the meaning of an observation is relative to the reference frame in which it is being observed.

This effect is terribly misunderstood by people, and misquoted as "Everything is relative" and "no view is right" and "There is no underlying reality." All those are wrong. What Einstein said is that, you need to make corrections to observations that depend on the type of distortion of the observer's world, and, after you do that, any two observers should agree on what they see.

So, there is very powerful mathematical formalism, originally involving "tensors", that allow these effects to be described relatively easily -- compared to the alternative of having to write down 256 components of the curvature tensor every time you said something about it.

This is good news, because people have a very similar problem. What we "observe" is in no way what is actually "out there" -- it is a similar conflation of our current set of biases, prejudices, mental blind spots, stereotypes, and what is "actually there". As in General Relativity, we cannot see our own blind spots, and are unable to detect where our biases have taken over and warped our judgment which, to us, looks just fine.

This, of course, is why "double blind" experiments are good if you can get them, so that the unconscious biases of the experimenter, regardless how hard he or she tries to be careful, do not alter the final conclusions.

Humans are excellent at mentally "papering over" their blind spots with what they think should go there, and not being able to detect that they have done this.

Anyway, "reasoning" alone is not sufficient. One has to track not only the math of how the contents relate to each other but also how the contexts relate to each other.

You could, I suppose, say that,well, yes, this is just reasoning. No, it is not "reasoning" as currently understood and practiced. The current interpretation of reasoning is that space is flat, there is no curvature, scientists are capable of being unbiased, and if A+B=C over here to this scientists, then it will still equal C over there or to a different scientists, without correction for where it was observed.

In fact, a basic assumption of physics is that it doesn't matter where you are, or what time you start, or what direction you are pointed, you should still measure exactly the same physical laws. I'd add, they also assume that you get the same reading regardless how large a ruler you use.

In reality, it seems that there is context dependence, and life is fractal or at least non-uniform, and what is measured at large scales may be exactly the opposite of what is measured at small scales, for the "same" physical event. (See post on "hybrid images" for examples, such as "Marilyn Einstein" or the "happy/angry faces" that look different, depending on how far you stand back from the picture.)

So, at a minimum, it would help if people understand how much of what we think we see is actually a function of our viewpoint, our biases, our mental models, our context, what we had for breakfast, what our spouse had for breakfast, etc.

Responsible observers making careful observations in different contexts will get different answers.

Responsible logical thinkers, starting with the same facts, in two different contexts, will assemble them into different, and possibly contradictory conclusions, regardless how carefully they work.

This is a crucial fact to sort out, and even it is not dealt with well by science, let alone by laymen. All of these effects can be demonstrated, and can be counteracted, but seldom are.

All of these effects can be adjusted for, to remove them from the final conclusion, by different people, but again, this kind of meta-reasoning, or reasoning about the impact of deterministic context in which reason is applied, is not currently the usual practice on Earth in 2008.

Even it is blocked by those who refuse to consider the possibility that there is something that can be improved about the process they use to reach conclusions and to consult with ech other.


Wade

further beyond reason

(note - this post extends the prior post here, "Beyond Reason" )

There are several other dimensions in which this argument can be supported.

The first is models of any kind of collaborating agents, as I mention in my comment to my last post.

For those who insist on purely academic and "scientific" examples, I'd suggest the model of connecting many legacy computer systems together in a company and trying to get that mess to work.

The "tinker toy" model of little balls (legacy systems) connected by little rods (messaging pathways) simply doesn't work, and breaks down pretty rapidly as you attempt to scale it up. Having each agent determine its own version of "truth" doesn't work.

However, having each one chip in to the discussion about accepting each fact does - in what is known as a "two-phase commit."

A true "distributed operating system" is one in which each agent gives up some level of control and self-determination in exchange for the entire thing working at all.

It's a model that works. It's a model close to the way cells relate in the human body, or neurons in the visual system.

It should be explored more as a model for civilized behavior.

A second strong support are the deviations from Turing's hypothesis. Computability is generally determined on the basis of a Turing Machine model, which is complex to explain but basically says any computation can be reduced to a very long tape of ones and zeros and a machine that reads them and decides which way to move the tape.

The problem with applying that model to human beings is that humans have finite energy, bandwidth, and attention span. In fact, often a very small volume in communication space. Any communication that has any longer-wavelengths in it that fit in such a small box will simply be lost and are not possible. No "long-term" issues will "make sense" at all.

"Reason", if by reason we mean the application of logical steps to a series of strings of symbols, is thereby limited for humans to what can be said, via shared symbols, in a short period of time. And, for the symbols to be shared, they have to at least have been learned, which means they can take no more than 100 years to learn. Again, we have huge limits here on what can ever be communicated that way, even neglecting how fast things are forgotten and partial understandings evaporate. In reality something that takes over a day to communicate is highly unlikely, especially if it has high information content, i.e., is very surprising and doesn't fit preconceived notions.

Furthermore, human brains and perception fill in gaps, leap ahead, resolve ambiguous phrases into stereotyped meanings short-circuiting the whole process. The communication is, in sort, noisy, misunderstood, mis-resolved, and decays rapidly.

The power of reason to accomplish synthesis of meaning and action and synergy in such a context is demonstrably poor. And, we have no other context.

On the other hand, if we go to higher dimensionality communication, such as image processing or higher, many of these bandwidth limitations can be pushed back at least an order of magnitude. These communications would be somewhat holographic, conveying many related idea and their relationships in parallel, not in serial order. This works. "A picture is worth a thousand words".

Actually, I think virtual reality and immersive experiences can be even more compelling and complete than pictures, but that's a different post.

I simply don't see any other conclusion than "Therefore, reason is not a good tool to use for stabilizing civilization and getting the mutual destruction to stop."

Reason may be part of a set of tools, but it is not complete, and I can see no empirical evidence that it works at large scale, at all, ever. Our toys grow more sophisticated, yes, but our conversation about them grows less sophisticated, increasing daily the risk that our toys will be misused.

Frankly, we are stymied by the simple problem of making N plus 1 people more powerful than N people at deciding something or perceiving something. We have what is referred to as "committees" and God help us if the committee size is over 5. We are without tools to help. Unassisted appeals to reason do not seem to do the trick, in realistic contexts.

Third, all reasoning assumes, essentially, that the metric space in which we are working is flat, and that the value at any given "point" in space of "truth" doesn't depend on the pathway we used to get there. Or, more precisely, that the value we show in our tabulator of taking the present facts and reasoning with them to that point should be, we think, independent of the pathway we took. We can use B implies C before or after we use A implies B and end up in the same place.

First, this assumes truth is single valued. Even that is not clear.

Second this assumes that the metric we are reasoning in, some kind of Hilbert Space, is flat -- so that, at the end of a day, we do not end with something like M.C. Escher's waterfall -- that is locally reasonable and globally unreasonable.

In reality this appears to be unjustified. Small factors that we see as "ignorable", in a world with millions of cycles of feedback, turn out to be more important that what seem locally to be "big" factors. Tiny differences result in hurricanes and tornadoes out of "thin air". This matters.

In any Hilbert space, I believe there is always a locally flat coordinate system that works locally, but this does not mean that the entire space is flat, nor that it can be covered by a flat metric.

I find this is the strongest argument at all, involving geodesics and "lines of reasoning", but I fear it is the least accessible, unless the reader has experienced metric spaces in some mathematical context.

In point of fact, reality seems to me to be more fractally complex than flat. From higher up in an organization, the myriad of details that lower levels have to deal with are completely invisible, recursively.

And truth seems to be fractal, in that the size of ruler used to measure it, and the scale of time and space used as a framework, seem to change the measured value. (See hybrid images post).

So, between a world way more complex than desired, and a reasoning power collectively that is way weaker than desired, the ability of reason alone to solve humanity's problems seems in doubt.

This is not to say that reason is not "locally valid".

But to deal with larger scale issues, we need some tool that is not bandwidth limited by the way humans think and perceive and communicate.

I'm not sure what it is, but pretty sure what it is not: It cannot be serial messaging in nature.

What we call "reason" and "reasoning" are incomplete, and will never span the problems we are trying to solve, let alone span them in the time we have left to work on them before we annihilate each other and our planet.

Reason and Science have worked very well on problems that could be flattened into a flat space without damage, such as building machines. They have not worked on problems that cannot be detached and flattened, such as every social problem. This will not be fixed by waiting. It will not be fixed by "trying harder". So, it is doubly cursed - even if "there" made sense and covered all cases we care about, you cannot "get there" from here. Reason alone will not work.

Mindless defense of "reason" as the only pathway to our future
hurts more than it helps, because it prevents adequate research into methods of finding truth that are better than reason, and that converge much more rapidly in the actual world with actual humans, messy politics, corruption, legacy hatreds, etc.

Denial that anything could possibly be better than reason
is a religious statement, based on faith, not solid facts or even solid
theory.

No one could possibly know that, for almost any definition of "better."

This is not an argument to go back to superstition, but an argument to go forward to actual mature capacity to face and deal with hard problems together. Such maturity undoubtedly uses reason, but was not and will not be created by reason. There is something else at work.

The astoundingly poor record of science to cure the worlds ills, and, in fact, to seemingly only solve some at the expense of making others far worse, argues that science is not close enough to the right path, or the right speed, to be left unexamined.

If scientists do not recognize this issue, and continue to paint all their critics as some kind of blind, irresponsible, religious zealots, their arrogance will bring about their own extinction, along with everyone else's.

Seriously - if everyone in Congress simply had 8 more years of math and science, do you contend we'd now have a balanced budget? If they all had dual PhD's in math and science, would we be home free? I have to look at the University of Oxford, which can neither balance it's budget nor select an email system, and say, "No."

No, because the problem is way bigger, deeper, and wider than that. Reason itself only works in a social context, and reasoning is not the process by which social contexts have ever been decided or determined. Reasoning about Oxford will not "fix" Oxford, and I can't begin to grasp the solid basis for an assertion that it could, based on the contrary evidence of the last 1,100 years.

We can't even make committees of 5 that work, people.

It's time to address the actual problem, not this straw man. Something else is wrong. Get "unreason" out of our faces so we can see what it is.

Wade

Beyond Reason

(Another letter I sent today to the editor of NewScientist ).
================================
Thank you for the excellent coverage of "The forbidden question - What's wrong with reason?" (July 26)!

I would suggest that our culture has learned a lot from time time of Kant's quote (page 42), "Immaturity is the inability to use one's understanding without guidance from another." If culture is akin to a person, what that describes is perhaps an 18 year old young adult.
What we are sorely lacking is the vision of advancing past that to the equivalent of marriage or civilization. They say that a good marriage is one between two adults who are capable of living separately just fine, but who prefer to live together.

They have gone beyond the need for independence and have moved on to mastering interdependence -- what might also be called "unity with diversity." Neither one dominates and both benefit.

American language has no word for that, as "adult" or "mature" has been converted to mean "able to purchase cigarettes and pornography". Clearly this is not a subject of much discussion.

This is extraordinarily relevant, because it is not in the independent reasoning category that our civilization is breaking down, so much as in this re-linking step into a synthesized larger reasoning, perceiving, and acting unit -- a meta-person.

Our schools still teach the "Rambo" approach to great individuals, but across the board we see the start of realization that we need better group work, or team work, or collaboration, or cooperation, or unity, or something over in that general direction. We need something in which no one person (or corporation, or country, or concept) dominates everyone else to the extinction of the other.

It seems to me that many of the attributes of human beings which appear to be "bugs", so far as pure reason go, will turn out to be "features" that allow this meta-synthesis to take place and work. For this we need empathy, the capacity to be unconsciously moved by the others nearby to leave one's mind and hands free to work on the problem at hand while a subconscious unity is messing and mending whatever it is down there that we lack.

And, we need to be joyous about that activity, and welcome it -- both of which have no meaning at all in pure reason. Reason appears suited for computers that wish to network. Something larger is required for humans who wish to civilize each other.

It is not back to authority we seek, not an abandonment of maturity and reason, but going forward to the joyous interdependence that is the basis of civilized living, and true "maturity."

And, yes, this topic is in Chomsky's category of forbidden subjects in the US -- anything even remotely like extolling the virtues of it would be smeared as socialism or communism or terrorism or the smear of the day.

But we know it's right. We can feel that it's right. We are torn in education and teach both "Do your own work" and "Learn to work well with others." The breakdowns in our teams, families, companies, and societies are in this realm, not in "reason". Reason is the messages but reason does not build the communication lines - something else does that. We need them both.

The prestigious US Institute of Medicine, in Crossing the Quality Chasm, notes the critical role that teams play in health care. In fact, in all critical high-risk industries, it turns out that honest, open teamwork and "psychological safety" are required, not optional. Even the US Army leadership doctrine requires superiors to, gasp, listen to their subordinates and build relationships and trust and integrity and character, as being more important than technology to success in battle. (see links to the US Army Leadership Field Manual in http://newbricks.blogspot.com/2006/12/us-army-leadership-field-manual-fm-22.html as the certificate in the army site seems to be broken.)

Again, if these are part of "reason" they are not very accessible or explicit. There is ample empirical evidence that these human traits are crucial to survival, success, and any plan for thriving instead of mutual annihilation amid fragmentation.

Please stop destroying those values in the quest for the goal you have for "reason."

Science vs. Religion redux

I sent this letter to the magazine New Scientist yesterday, and it seemed worth copying here.
===============

What a wonderful mix of articles and editorials in your July 12 issue, talking of challenges to science, to religion, to Darwin, to genetics, and even to the Templeton Foundation.

Indeed, some overly simplistic models of the world need to be challenged. Sadly, as does religion, the institution of science seems to have many such overly simplistic models, the failings of which are quite visible from outside and quite invisible from inside.

For example, on page 5, in your editorial "A lesson in cynicism", you note "the gulf that exists between how scientists perceive reality and how some politicians do." Again, sadly, you seem to miss your own point that, in terms of political and social reality, the politicians are far keener observers than the scientists, and it is the scientists who need to wake up.

Ahh, perhaps some wags would argue that political and social reality are not real at all, but are, hmm, fictions of some kind that simply have observable consequences on everything from funding to global climate change. Well, which way is it folks? Is everything around us real, or not? Are you arguing for two different sets of rules and laws for the parts of reality that involve humans and the parts that do not? How ... 19th century.

Or could it be that the so called "hard sciences", which are really the easy ones, saw that the same mathematical tools were not very successful at predicting much more complex psychological and social phenomena, and therefore, it must be that what is broken is the phenomena, not the tools? Why all the dumping and scorn of the "soft sciences"?

So the parts of the problem that were deemed irrelevant have suddenly been perceived to have the relevance they always did.

I will suggest, as I have before, that there is indeed at least one common ground to the institutions of Science and Religion, and that is in the area of control structures and determination.

Both Science and Religion have a great deal of interest in the nature of causality.

This is highly relevant, because our understanding of the nature of causality itself is in flux. In the field of public health epidemiology, for example, there are the so called "Epi wars", where those who believe in hard biomedical determinism and causality are literally shouting at those who believe in softer, distal determinism on a larger scale, such as the unambiguous observation that "smoking causes cancer."

Where this seems to be taking us is to the idea that causality is not as simple as we thought, and, like a fractal, what you measure depends on what size ruler you use. On the scale of individual people, smoking is not causally related to cancer, by classic definitions; but on the scale of populations, smoking is clearly a cause of cancer.

This scale-dependence is all around us, but not generally recognized. Even indoor plumbing reflects this, where the trajectory of a given water molecule is determined only by the water molecules around it, and yet, seen from afar, it is generally possible to make the water go from the water tower to the kitchen faucet. At a small scale, non-deterministic, and at a large scale, deterministic. That kind of causality is not comfortable to Science, but permeates social-scale interactions.

So, an advertising giant can methodically change the opinions of "people" without being at all causal, or even visible, at the individual "person" scale.

Until Science can recognize good tools for "seeing" and measuring and modeling this kind of causality, perhaps it is premature to make confident statements about whether the Earth is or is not within a larger influence field of some kind and some scale larger than Earth.

We hardly need to invoke "God", given that our sun is a second generation star (containing iron from the first generation), so alien races could have a 5 billion year lead on us, and farming or raising or making planets might be as boring for them as raising corn is for us.

My overall point is that it is a valid question, for both Science and Religion, to look for "outside influences" on life on Earth. Our tools for doing this are sadly lacking, and it seems bizarre to leave this search to Religion.

The technology of detecting and measuring outside influences would be of great interest on a social or national scale. It's a perfectly valid scientific research question.

We should look at it, and invite both the SETI crowd and the religious crowd to come look with us. Let's not make confident prior assertions about what we will see with instrumentation that is not yet even built. Stop bickering, build the tools, and look. Anything else is like Aristotle talking about how many teeth women have without ever looking to see. Let's not commit the sins we accuse "them" of.

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The Other Strength

I think self-help books have it backwards when they talk about how to deal with a crisis by looking for our "inner strength".

I usually agree with him, but even Tony Robbins in his book Awaken the Giant Within, falls into this trap.

Because, I think, the sleeping giant of strength is not "within" at all. It is "without".

This is a kind of important difference if you need to "fall back" on this when times get rough.

It's also pretty important if the lessons here are as relevant for entire nations or religions or cultures falling on hard times, as for individual humans. And I think they are relevant.

It doesn't take a genius to notice that times are getting bad for people, for communities, for work teams, for departments, for companies, for states, and for the whole United States, for example. I'll speak to that since it's where I live and so I have a view from the inside, with all the pluses and minuses that brings to my ability to observe it. (Fish do have difficulty perceiving water, they say.)

Now, we can asssume that all of these groups are not passively sitting by. In fact, it's probably true that many or most of them are making serious efforts to get out of the bind they are in, but those efforts are simply not working.

Well, maybe they are not working because they have the wrong concept of where the problem is. Maybe, they are trying to solve a problem "within" when the problem is "without". If the problem is not in the box, then odds are the solution is not in the box either. We need to look outside the box and see what's there, at least, in case it matters.

Yeah, it matters.

Coming at this from the other side, there are some surprising things that science has discovered recently.

Most of the recent research in Public Health is finding that the more someone is disconnected from society, the worse their physical health seems to be. Of course, this is a loop or death-spiral that feeds on itself, because the worse someone's health is, the more they may find it too much work to be sociable. This is a very solid finding. One of my professors at Hopkins described this as the most robust finding in public health aside from "smoking causes cancer".

And I have heard that solid research shows, for someone 65 years old, making a friend has more beneficial effect on their expected lifetime and health than the combination of stopping smoking, stopping drinking, lowering their cholesterol, and exercising regularly.

So apparently our physical health and psychological strength depend a great deal on how connected we are to society.

Since this well-established fact remains both baffling and surprising to people each time they come across it again, I think we need to revise our mental model of how we think about people, so this is no longer a big surprise, and we automatically take it into account when we plan and end up with more success in coping with a crisis.

So, without getting tangled up in how this could operate, I'll suggest that we get better answers if we think of people as having outside edges that do not have to be the same as where their skin is located. Since we don't know what people are, or life itself is, this is no big loss for a way to think of things.

So, say that the outside boundary of each of us is actually a shape that includes within it all of our close friends. Then it is far more natural to assume that something that happens to a close friend would affect our body or our mind, because that something is now "inside us" where we assume all of "us" is located.

That is, we can salvage the "strength within" approach if we alter the term "within" to include our close friends. We can double check that, yes, now something that happens "within us" can affect our strength and health.

But we have a new capacity if we think of ourselves this way that we did not have before, a new avenue to explore. One thing we can do to get stronger is to increase the strength within the physical skin of ourselves. I'll call this the Rambo approach. It works for a while then it runs out of steam, and that point is where most of us live - on the verge of being out of steam.

The other thing this new concept suggests is that we could also get stronger by expanding our definition of "us" -- by including more people, or more of each person, within that outside boundary of the new "us". We are not limited to having simply one physical body within the outside limits of who we are - we can include other bodies as well.

Again, I have no idea how this might be implemented in biology, but it focuses our attention on the idea that, in a crisis when we need more strength, we should be trying to expand our network of friends, not beating ourselves up because something "inside us" must be broken.

Yes, something is broken, almost certainly -- it's the part of "us" that used to reside in other people out there, letting us all share the same strength.

Unlike the Rambo approach, this approach to body building is "unlimited upwards" -- there is no limit to how strong we can become.

Although this seems like a somewhat unnatural idea, there is an analog in the world of computers. For many years, IBM and Cray and other companies tried to make a supercomputer by making one computer stronger and stronger. That idea ran out of steam.
Then it occurred to someone that maybe they should simply abandon that idea, and look instead at how to take many small computers and hook them up to each other so that they operated as if they were just one biggie-sized computer. That did work, and is what everyone is doing now. I think IBM's last "supercomputer" is actually 64,000 smaller computers working as one, or sort of working as one. Maybe it was 200,000 smaller computers. A lot of them, in any case.

So what is "strength" in terms of getting out of a crisis? One factor is ability to see better what's wrong and what options there are -- that should improve with more people involved. Another factor is ability to simply lift larger objects -- pure muscle power or cash reserves, and again, yes, that should improve or might improve as we add more people.

Another kind of strength that, like Rodney Dagnerfield, "gets no respect" is the capacity to avoid falling into the pit in the first place. And, yes, I can immediately think of several million families that would be in a lot better position today if they had consulted with many people before rushing into a terrible mortgage deal on that new house.

So, having many friends, or more precisely, extending your own identity to include many other people, seems likely to have very positive effects for getting out of a crunch, and for avoiding getting into one in the first place, which is even better. It seems even good insurance has deductibles, and so it's cheaper to not crash at all.

Does this happen on the scale of an entire company? Yep. Look at Southwest Airlines, that has made a profit for the last 69 quarters in a row, while every other airline is going broke. How do they do that?

A rather short-sighted two-page spread in a recent USA Today claimed this was due to Southwest's hedging strategy, where they bought fuel today for the next 5 years, at today's prices -- except they started doing that ten years ago. So now, they are paying basically $1 a gallon for fuel that costs other airlines $4 a gallon.

Well, any idiot can see why they're doing fine. They lucked out.

Oh? Why did none of the other airlines also "luck out"? On digging deeper into this, it seems that in other airlines, various vice president would get outraged if money that could be used for their immediate issues was "spent" on buying next year's fuel. Only in Southwest Airlines could people defer immediate gratification and think long-term.

OK, and keep on going. Why was that true? Or did they just "luck out" there?

No, it turns out Southwest's executives have an astounding approach to life - namely, that they are in it with their employees, all in the same boat, not employees in one and executives in another. The executives have, we might say, an identity that extends out to include the employees.

One sign of this, for example is that, after the World Trade Center disaster of 9/11, when flying was unpopular, all the airlines responded by laying off employees except Southwest, which did not lay off anyone. How did they do that with falling revenue? They cut executive salaries. Was that a clever move? Turns out, yes. Turns out that a company where people thought of each other as friends not competitors has a lot more survival capacity than one where each person is fighting for a larger portion of the pie than their neighbor has. They end up with a much larger pie.

Is this all a coincidence? Did they luck out in doing that? No, we can read corporate literature, or simply look at the company's stock ticker abbreviation: LUV. That says it all.

Do these several million families have the resources so they won't lose their homes? They don't think so, but I do. Suppose each family invited a second family to share their home, and split the mortgage payments -- would that help? You betcha.

So why don't they do that? Aren't they "lucky" enough to think of it?

This is a damned good question, worth an entire other post. Why indeed. What have we done to ourselves that, when faced with a crisis, we would rather sink than turn to each other for help? In fact, in the home-sharing solution I suggest, there is no "charity" or "hand-out" -- just two families meeting their own needs.

Maybe, our congress should use all that money they just decided to spend on this crisis to address the real crisis, that has nothing to do with mortgage terms, and everything to do with why two families can't live together in peace.

They do this in other places, in other countries, so it's not impossible for some genetic reason.

Of course, to accept that possibility would also suggest a possible solution to the crisis hitting the entire national economy -- maybe we should look for a solution that's cooperative instead of competitive, with other countries.

I can hear shrieks and see people running from the room.

We need to seriously consider what mental model we have of strength, both to get out of a crisis, and to avoid getting into a mess in the first place. Would the whole US be in a better position if we were better at listening to advice of our friends? Hmmm...

The answer is right here in front of us, everyone. It doesn't require "an act of Congress" or an act of God to implement it. (Although maybe an Act of Congress declaring that multiple family dwellings were suddenly legal regardless of local zoning would help in some wealthier neighborhoods.)

We would get way, way , way more bang for our buck by addressing that problem, of why we don't work better with the external parts of ourselves. Why do we take "broken apart" as if it was the normal state we could do nothing about?

Good question. Very good question to look at more.

workplace abuse and narcissism

Some interesting articles on workplace abuse and narcissism syndrome.

http://www.drirene.com/7_nar.htm
http://www.selfhelpmagazine.com/articles/wf/abuse.html
http://www.drirene.com/16_nar.htm