Summary Fusion of OBT&E, OBCE, Credit, Currency, Criminology & Policy

OBCE distilled to 4 points:

1) Aggregate progress means local habits have to give way to emerging, aggregate habits.
2) The habit of coordinating Cultural Recombination is mightier than competition.
3) Public Discourse defines Desired Outcomes and drives coordination.
4) Practice drives agile Public Discourse.
[Any comments? Feedback is absolutely required, as you'll see, below. :) ]

Let's start with a challenging axiom.

There is no distinction between leading, policy, economics, and operations ... there is only staging, linking & sequencing of distributed actions, to explore emerging options.

Next, let's jump right in by noting that aggregate success, and Output Gaps are gated primarily by outmoded, persistent local habits of dominance & subjugation, ... with no aggregate goal in mind.

The real kicker here is that the vast majority of self-defrauding behaviors, from Innocent Frauds to Control Frauds, are expressed as insufficiently examined habits, among people who are not are not getting enough practice at thinking anywhere hard enough to sense the aggregate outcome of their personal compulsions.

In short, frictions and output gaps are manifestations of lagging coordination.

And the frauds that supposedly sap coordination? Frauds are just random agents following random actions - SANS ADEQUATE PATTERNS OF AGGREGATE FEEDBACK!!!

There is a better way. We can call it Evolution, and it's core methods are coordinating on a greater scale.

How does coordination grow? Via inevitable autocatalysis. If it can, it eventually will, simply due to statistics. So if it can happen, why not sooner rather than later ... which may be too late?

How does a human aggregate catalyze it's own coordination? First, by adequate preparation. Group Intelligence is always held in the BODY OF PUBLIC DISCOURSE. We have to generate an adequate sampling of aggregate discourse, before we can tune and leverage it to fit a given context (aggregate regulation). So the key, underlying process always requires practiced familiarity at changing methods for continuously generating & re-shaping adequate patterns of distributed feedback. That requires agile Public Discourse in it's broadest sense.

That's what Walter Shewhart, 80 years ago, called the "Cost of Coordination." Any biologist, ecologist, physicist, chemist or statistician would agree with Shewhart's statement.

"In all .. systems, the highest cost, by far, is the cost of coordination." W. Shewhart

Shewhart, and later students of his PDSA cycle, such as Deming & Boyd, considered the immediate corollary so obvious that they never bothered to state it in print. However it's useful to state it for beginners, simply to prime their learning curve. "The highest return, therefore, is always the return-on-coordination."

Jumping ahead, one can readily see from this that It really does ALWAYS come down to saving aggregates (not just frauds) from themselves. And saving our nation along the way. How? By indirectly tricking any and every size aggregate into actually exploring coordination on a larger scale. Humans are inherently exquisitely cooperative, but coordinating their constantly emerging diversity creates a continuously growing need for NEW coordination triggers, moderators and practice methods.

Call it Cultural Recombination, or something else, depending upon who's listening, and why. :)

Cultural Recombination is an extension of the same process that occurs during Sexual Recombination and embryology. We need social catalysts that drive and shape Cultural Recombination as much as we need the proteins and nucleic acids that catalyze sexual recombination.

Just adequately reconnect everything to everything to master context, and then - for resiliency - relax to what's minimally needed for a given context. Aggregate resiliency means actually keeping enough in adequately distributed reserve, to enable re-mobilization for changing contexts.

Cultures just do that continuously, in interleaved, asynchronous patterns. That always makes me think of Combinatorial Chemistry. In "Combinatorial Culturary," we're throwing more stuff together all the time, whether we will or won't. Our task is to select an aggregate adaptive signal from the changing aggregate noise. Luckily, that's all we have to do, and we're very good at it, when we bother to try.

Have analog computing system, must use it.

The only analog computing system more massively parallel than the human CNS is the human culture. Both are terrible things to waste.

ps: There's also one, undeniably inevitable "economic" corollary to all this. Growing aggregates must devote higher proportions of their time to aggregate coordination. The ratio of "dedicated work" to "dedicated coordination" is a function of aggregate size. Simply put, that means that the AVERAGE hourly work week should be continuously declining variable, co-yoked to population size and aggregate agility. If we're to maintain a functioning democracy, then our hours of work per week absolutely cannot be a fixed constant. To reap the insane return on coordination, we have to dedicate increasing proportions of our time to distributing, analyzing and testing the implications of our own, distributed feedback - instead of just working harder at what we're already doing wrong. It's that simple. Less work, more discussion & coordination.

A Nation Bouncing Uselessly Between Alternating, "Stolen Narratives"

There are some startling and very troublesome allegations in the two reports below, forwarded in an email from Chuck Spinney.

These reports certainly fit the picture of a nation bouncing between alternating, "Stolen Narratives," continuously fed to a divided and conquered electorate. That's no way to run a Democracy. We can do better.

As Chuck Spinney (below) and others repeatedly note, both sides in the ideology wars leave outrageous national returns on the table, untouched, based on their fear and loathing of each other's positions. The left's & right's inability to pursue the additional, compounding return on coordination (as we did during WWII) is eroding and wasting most of the potential of the USA (and other countries too). If these opposing sets of obsessive, compulsive ideologues would just work honestly together, all would benefit, by more than either can currently imagine.

The only thing we have to fear, is fear of coordination?

At the end of the day, you have to ask the following questions. What part of Democracy and teamwork does our current electorate NOT understand? And why don't they? We should NOT be stocking our policy offices with these kinds of actors. We are better than this. Far better.

No democracy can succeed by pursuing an absolutist fight to determine whether two random, arbitrary, and opposing views are right or wrong. In a changing world, they both are, always. It's only a matter of time. Survival lies only in cooperatively exploring all emerging options, and discovering what no one could expect or predict. If the unexpected is discovered sooner rather than later, the net returns are unimaginable. That's easy, if we just let it happen.

To counterbalance the current view of the GOP-only as synonymous with the MICC, I've also listed links to 2 critical reviews of the Carter & Clinton administrations, indicating two equal but different flaws in what can, again, be described as over-simplistic, stolen narratives, this time from the Democratic Party (either dealing naively with the MICC or Wall St. - a FICC* - or in turn, being captured by them). 

We could go all the way back to LBJ and Vietnam, or Eisenhower as the first to warn against an overly influential MICC. However, instead of choosing sides in a pointless, political civil war, let's move on to something better, by abandoning the 2-gang, .. er .. "party" political system. The 2-party approach to contingency management is an obvious failure. Instead of a 2-channel approach to public discourse, we need faster/better/leaner ways to use all available channels.

Roger Erickson, Jan, 2014

***

Chuck Spinney (email commentary quoted here) speaks with considerable authority on DoD policy issues. [Jan 11, 2014]

"Gareth Porter and Robert Parry, two of our finest investigating reporter/historians deserve kudos for placing the self-serving nature of the [recent] Gates' memoir in a proper perspective.

Readers should bear in mind that the soap-opera-like gaming of Obama into acquiescing to the fatally flawed plan for a surge in Afghanistan surge in 2009, described accurately by Porter and Parry below, was clearly obvious well before Obama made his decision to cave into the pressure exerted by Gates, Clinton, and the Generals and their neo-con allies in Congress. 

To be sure, Obama was also feebly playing the game by leaking differences of opinion to the press -- but his was an amateurish operation by an inexperienced malleable politician and his pissant staffers. Those on the other side were pros in manipulating the wholly owned subsidiaries in the press. Predictably, as explained [in the articles listed] below, the brass hats won in 2009, notwithstanding a well publicized last ditch effort to stop the madness executed by Ambassador (and former General) Karl Eikenberry. 

Now, with the publication of his memoir, Gates is attempting to administer the coup the de grace on the dawn of a mid-term election -- which shaping to be a bad one for a hapless President and the Democrats ... and this is just an opening shot. Benjamin Netanyahu, with the help of many Democrats as well as Republicans, has another exceeding dangerous caper waiting in the wings (more on that later)." 

Herewith are Porter's and Parry's reports. 

Gates Conceals Real Story of ‘Gaming’ Obama on Afghan War

Robert Gates Double-Crosses Obama

***

And here are counterpoint reports, lest anyone think we're following anything other than ping pong policy narratives.

The Trusteeship Presidency: Jimmy Carter and the United States Congress

The Great American Stickup: How Reagan Republicans and Clinton Democrats Enriched Wall Street While Mugging Main Street

A Presidency in Peril: The Inside Story of Obama's Promise, Wall Street's Power, and the Struggle to Control our Economic Future

http://en.wikipedia.org/wiki/Military%E2%80%93industrial_complex

* FICC, Financial, Industrial, Congressional Complex

What Do We Do When We Have This Much Contention At The Highest Levels Of System Governance? ALLEVIATE IT!

Last Friday, I was just at a contentious seminar that turned out to be a model for nearly every systemic policy process underway today.

The forum discussed MICC decision-making & how well it aligns vs ignores critical service demands for CAS (close air support) decision-making.

http://www.pogo.org/our-work/straus-military-reform-project/weapons/2013/a-seminar-on-combat-effectiveness.html

see also http://www.pogo.org/our-work/straus-military-reform-project/weapons/2013/air-force-brass-ignores-wars-lessons.html

The whole event was literally riveting, from start to finish!

Why? Ultimately, for what it revealed about our systemic governance processes, beyond even what it meant for those working with the topic at hand.

There is far, far too much to relate about the content of this forum, but here are two key points that cut through all the other details.

1) A retired AF pilot and officer, Chuck Myers, said the whole concept of CAS had been off-track from it's inception (>85 years ago), and should be re-named as MAS (maneuver-air-support) - to direct all discussion of it to the key concept of net, team agility (i.e., Adaptive Rate). Chuck seemed to be the oldest person present, yet seemed to have the most - and an astounding - grasp of system development, or appreciation for a "system," from tactics all the way up to politics. Yet, his story was one of lifelong frustration. Learning much, and passing on cogent warnings about tragic, unsolved systemic issues. Made me think of a drill-down of Eisenhower's MICC speech.

2) Chuck Myers also related a story from post-WWII, involving a legendary AF Gen he once worked with, Elwood Quesada. Quesada had suggested to the highest levels of DoD command, that AF/Army/Navy/USMC coordinate weapons platform development ... and was told by senior generals that they couldn't do that, since the competing service leaders "are the enemy."

    You can't make this stuff up!

As I understood it, that observation of deep, organizational toxicity occurred before even the Korean War! Worse, it has never been remedied, and persists, magnified, in the highest levels of our cultural policy governance, even today.
  Astounding!

(At this point my mind was already silently screaming to myself: "What about our Goddamn 2-party system - that makes an ongoing art out of having whole swaths of citizens name each other, and each other's representatives, as enemies? And all our isolated, narrow-thinking lobbyist processes? What have we descended into? And what are we going to DO about THAT?)

More direct ruminations triggered by the meeting.

The meeting agenda revolved around the immediate furor over the AF removing the A-10 CAS/MAS airplane from service, and leaving a significant needs-gap with only vague promises that it would or could be filled by alternate means. There were deeply moving testimonies from multiple service veterans documenting that morale suffered from such decision processes, starting with a sense of betrayal, progressing to organizational fatigue, and culminating in performance degradation.

Amazingly, the resulting discussion REPEATEDLY drove home the hierarchy - for systemic success - of people(affinity)/practice/equipment - in that order ... YET, the whole meeting concluded with a question rather than a conclusion: "We've nailed the problem, now what do we do about it?"

That conclusion - or lack of it - was astounding, (for an outsider) since they'd all just finished re-documenting and re-agreeing on the classic solution ... at least at THEIR level. Yet, they COULD NOT, for the life of them, see that the systemic solution was simply a process of extending the "people(affinity)" grouping to the larger set of people that every task-team has to coordinate with every year (in every evolving culture) - as both populations and their layers of organization governance expand!

Restate it this way, as a question. What did pre-homo-sapien species do, as their cell-count and physiological complexity kept evolving (from, say, 1/2 Trillion cells in some small mammal, to the 10X Trillion cells, different cell types, and different organs in the current human physiology)?

Answer: First off, all the human cell numbers in our body maintain their total group affinity, above all else, as they grow from one egg cell to the 10X Trillion cells in an adult.

System growth simply cannot outgrow it's methods for maintaining affinity and hence it's motivation for "inter-service coordination" among ALL system components.

It's either a system ... or it's a mob in some grade of civil war.

With system expansion, every (seemingly) intractable system-organization task has a solution, and that solution involves adding yet another layer of indirection - to maintain first affinity, and then coordination? Ya think?

In other words, systems evolve by coordinating on a larger scale. Success is DEFINED as reaping the astounding return-on-coordination.

That dynamic at the meeting was, for a systems scientist, simply astounding to see, and experience, and to see ignored and missed once again!

To me, it seemed to be a system not hearing feedback from it's own new trees, simply because of the increased size of today's forest. They were missing their own, self-evident solution once again, and snatching defeat from their own, migrating, jaws of victory. The bigger problem - overall - seemed to be the task of expanding our electorate's perception - situational awareness - as fast as our own, bureaucratic situations expand.

The pace of the meeting was so quick that I never could get a comment in. There were always too many people with uniforms or urgent testimony to give - all dotting more "i's" and crossing more "t's" in the sympony which the chorus was preaching to itself. That's exactly what made the meeting so riveting, and yet we simply ran out of time to discuss what to do next. But I did get to talk with a few people afterwards, and think I have a follow-up path to try to help this critical effort along.

After all, if this group - who are SO close to perfecting continuously developing methods - can't be helped to take another step, then what hope is there for all our other sectors, who haven't accumulated anywhere near as much experience at actually having to make complex social-systems work? Those would be our other congressional/industry/agency/professional complexes.

That question stuck in my mind all weekend, and I woke up Sunday morning with an epiphany ... that surviving, agile systems are those that select for feedback loops operating with at 3, parallel, time constants (an old observation in biology; that there are always AT LEAST immediate, medium and long-term response mechanisms at work, EVERYWHERE you look, involved in every process).

My epiphany was that, in human-team terms, one can say it this way:

"Leaders" save the butts of adult groups in critical situations - immediate term.

"Teachers" train adolescent groups to handle newly discovered, critical situations - medium term.

"Parents" are always adding subtle new wrinkles, preparing developing groups to avoid getting deep into whole new patterns of critical situations (prevention through early intervention, as an improved form of "steering"). Long term adaptation.

Amazingly, military science has long recognized a parallel observation (but failed to adequately apply it to their own, personnel systems?). Their counterpart of this same observation is called the "3ɪˈs" of contingency management.

That is, deal with impact/interception/instigators[causality]. Military teaching also states that if you don't manage all 3 processes in parallel, that you can't win. Right?

So, an obvious question arises. Can we continuously adapt if we don't apply the same logic to our own, system development processes?

Isn't that how we avoid developing views which lead us to disastrously label our own team members as our enemies? For Kilroy's sake! Why is that NOT our #1 priority?

The "3ɪˈs" of managing the parallel contingency of our own, changing, internal systems ... are:

total team performance (self-leadership), 

total team training,  

total team gestation (cultural development).

What's that old saying?

If war is too important to leave to the generals, then surely EVERY process is too important to be left to the presumed process owners?

That lesson quite obviously holds for owners/managers of whole systems too.

It's fatally erroneous to presume that processes AND WHOLE SYSTEMS (including ourselves and our institutions) are permanent, and not transient.

   *****

ps: Someone also just sent me a reminder of a similar issue, currently in the news.

"The United States House of Representatives Select Committee on Assassinations (HSCA) was established in 1976 to investigate the assassinations of John F. Kennedy and Martin Luther King, Jr. The Committee investigated until 1978 and issued its final report, and concluded that Kennedy was very likely assassinated as a result of a conspiracy."  

http://en.wikipedia.org/wiki/United_States_House_Select_Committee_on_Assassinations

Tactically, it no longer matters whether JFK's death was or wasn't conspiracy by whichever particular people who saw him as "the enemy." It DOES matter that we have no systemic method for dealing with this taboo subject - in a timely manner - at ALL levels of our current culture. The perennial questions are - where can we get to from HERE, where we currently are, and how soon?

The claim is that some of our own people in high-level governance positions came to view Pres. JF Kennedy and Senator RF Kennedy as "the enemy?"

Again. For Kilroy's sake! If we can't quit targeting ourselves, then how can we focus, as a team, on external challenges and explore our own, emerging options? If the return-on-coordination is always the highest return, by far, then how do we keep our eyes on that, instead of lesser, goals?

If the lesser goals are below us, then we really have seen the enemy, and it really is true that "he is us." Therefore, our chief task is selection, and eliminating those process attributes that hinder team coordination. Those friction-generating sub-processes are our biggest enemy. We just have to train ourselves to recognize "them" as we keep spawning their child-processes, in every new thing we add.

It's a process of selectively pruning the high-friction parts of all the new activities which we constantly sow amongst ourselves?  Ya think?

There's no reason why we can't be better "parents" for our evolving culture - as well as leaders and teachers - of our existing electorate. We just have to teach appreciation for our own systems ... and their evolution ... to every student by, say, 5th grade. (Or, make that age 10, if we're already going back to self-directed, Open Source, education.)

That doesn't sound like a difficult task at all. These are simple concepts. We just need to apply them more systemically.

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

International Regulatory Rivalry in Open Economies: The Impact of Deregulation on the US and UK Financial Markets

It helps to understand our frequent opponent's oft-shared paradigm. "If hot money evading taxes in other countries is looking for a haven ... WE HAVE TO COMPETE TO RETAIN EQUAL ACCESS TO THAT STOCK OF CAPITAL."

We do? There are so many naive assumptions implicit in this claim that it's useful to just skip over all of them for now, and summarize a response. Many of the people taking this narrow view on financial deregulation, in isolation, are depressingly ignorant of the basic realities of system-operations. They seem universally unfamiliar with the hierarchy of sustainable returns in complex systems, or with the principles of systemic resiliency.

In fact, it's rare to find people outside specific sciences, the military or industrial statistics who are comfortable discussing return-on-coordination as the highest return - by far - in any complex system.

Clearly, one of our problems is that policy discussions have atrophied dramatically in recent decades - and are dominated by increasingly narrow outlooks.

Any ecologist, system scientist or control-engineer would say that the combination of fewer control channels and growing degrees of freedom in a system ... means growing instability, and danger of collapse. The Soviet Union and failure of Central Planning comes to mind. That same lesson was documented while building the Pyramids, if not before, and it was reiterated in detail during development of the steam engine.  Yet despite those and countless other ancient illustrations, the concept of a feedback/instability ratio is still a disputed topic of discovery in economic and other forms of national policy? IN A SUPPOSED DEMOCRACY? Who are we fooling, and why?

Given our ability to produce systemic lunacy on this scale, the only question is "how" we're managing to produce this unstable operational state, so we can stop propagating it!

My first thought goes to our systemic education processes. We're churning out growing numbers of people dedicated to increasing specialization in increasingly fragmented specialties ... exactly as we're noticing declining ability to muster net Situational Awareness in our aggregate.  Plus, we're also witnessing declining group policy agility. Hello!  Anybody home in there?

This ain't rocket science. If we want to own our democracy and our fate, we have to have distributed members acting like owners of their democracy, not just their isolated specialties.

Meanwhile, as we ponder how to stop increasing dissociation in our next generation, we must also look for shortcuts to catalyze even a bit more coordination among our existing electorate.

Interdisciplinary coordination platforms, anyone? Do we have a National Situational Awareness app for students 10 and above? Is there a whole spectrum of such "SA" apps? Minimally one for every category in the NAISC database? Plus another one every day, for all the new professions we're spawning, not to mention all the subcategories among and between all existing and emerging professions? (Actually, we do - it's called the human brain, and the group-brain.  We simply aren't challenging ourselves to use either type, at least not very well.)

Do we really need all those apps? Yes, we do. Here's an example why.

There are roughly 300 cell types and minimally 60 "organs" making up the human body and it's functional physiology. Yet to make a functional "person" requires countless hormones, metabolic indicators and cell-surface receptors - not to mention all the inter-connecting regulatory feedback loops connecting all receptors, neurotransmitters, hormones, cellular activities and organ activities.

The point is that THERE ARE FAR MORE PHYSIOLOGY COORDINATION "APPS" THAN THERE ARE SYSTEM COMPONENTS.
 
Anyone even remotely familiar with network concepts understands that there are more connections than components in any organized system.
 
With a little more thought, you next realize that there are more connection-adjusting feedback loops than there are connections ... yada, yada. Every complex system is a near-infinitely nested "stack" of subcomponents and their sub-connections, including all the methods and sub-methods for coordinating all the sub-connections at every sub-level.

What does that imply for human political economics? If we want a national culture to be anywhere as agile and accomplished as our individual physiologies are, we need a HELLUVA lot more, real-time, data-exchange apps, and they must be far leaner/faster/better than ANYTHING which we now possess.

Newspapers? Please. Don't embarrass yourself. Journalists? Bloggers? Aggregators? Ok, we at least have the rudiments of the ancient principle. How's this? Every bit of data you hear is USELESS, absolutely useless, if not accompanied by the full context or data-spectrum it is but a part of. Cue Walter Shewhart, circa 1926: "Data is meaningless without context."

Are we there yet? :) It always helps our mood to aggressively label a joke as a joke.

Face it. Aggregating news or opinions is a tactic.
 
Accurately conveying changing context - in real time - is a goal we as aggregates are just beginning to aim for. The payoff if we reach it is unimaginable. Let's just say that none of us is as smart as all of us. The USA - as a collective - is only as smart as our coordinating apps allow it to be. Until then, we're just an uncoordinated mob trying to stop acting like one, and desperately trying to coordinate as fast as our numbers are increasing. We're only treading water, and we're actually sinking a bit low, gasping for air, and beginning to choke on our own, disconnected components.  Call it a regression into class and clan war.

Does the USA policy apparatus know what the USA collectively knows? :) :) :)

Sorry to close on another joke, but it's an honest necessity.
 
[To be fair, do ANY grandparents know the sum of what their grandchildren know?]

At least we now have some goals articulated, which our kids can have fun aiming for. If you know kids, you know that all we have to do is tell 'em what can't be done yet, then let them have fun actually doing it.  Please tell 'em something more challenging than hoarding static capital in some other country, or trying to attract someone else's static capital here. Turn their eyes to a far larger prize, our own, dynamic capital, waiting to be accessed ... through coordination.

Our Only Real Goal is Operational Agility

In a recent post, Warren Mosler comments on the economic impact of the recent FICA Hike and Sequester.

Warren's terse writing style is sometimes difficult for for beginners to follow, but it provides a very refreshingly different view of policy, showing how much divergence & uncertainty there is between goals, policy, investment strategy, governance tactics ... and unpredictable outcomes. Given that unpredictability, our only real goal is operational agility in realigning our goals, policies, strategies and tactics with ongoing versus preferred outcomes. 

For Pete's sake! We make simple outrageously difficult. Why? Simply for lack of adequate interaction?

This country has far more talent than it marshals to work together. Sequester is a minor issue. Squandering available talent is a far bigger issue. We're not even trying to build a whole greater than the sum of it's parts. Instead, we're hoarding the freaking parts!

We have too many partially blind people all squabbling over their incomplete views. That's reminiscent of a horde of gnats so thick you can't even see the economy they're mobbing. Just a mass of gnats (or piranha?) flopping around this way and that, like a drunken sailor.

Hottest bets in both 'Vegas and Wall St.? Waiting for proof of whether the piranha cloud shows even a semblance of active navigation, or just truly random floundering. 'Vegas and Wall St. are like drunks in an Irish pub, arguing over what will happen at their wake.
If everyone is driven by incentive, and the biggest return - by far - is ALWAYS the return-on-coordination, why don't ALL of us always see that biggest return as the biggest incentive? Simply for lack of adequate interaction?

A brain is not a brain if the neurons aren't all connected to one another. Similarly, group and cultural intelligence is not an impressive intelligence if all people aren't connected to one another, exchanging at least key feedback and iterative discussion.

Did I mention that our only real goal is operational agility? Please. Go practice some random acts of coordination.