Friday, January 23, 2009

A New Kind of Economy-- Revised

"When faced with a collapsing economy, one should stop thinking of wealth in terms of money."--Dmitry Orlov as reported by Ben McGrath in The New Yorker January 26, 2009.

I will not provide a conventional economic analysis here for two reasons. The first being that I am not really qualified to do so, and there are plenty of economists talking around if not directly about the implications of Orlov's statement above. The second reason is much more simple, we know what capitalism is, its benefits and detriments, at least to some degree.

What Dmitry Orlov points to for me is a much broader statement about wealth that exists far beyond the parameters set forth by our economy. The fall of the consumption- based economy creates the space for a re-evaluation of other less easily measurable commodities. Re-evaluation and not evaluation because "to evaluate" is too passive a description of what now seems possible. When money is not so available as it has been for the last decade or more, a population who, within a spectrum, in some fundamental way, relied upon currency-backed (or consumption power) self-valuation, is forced to find a new way to measure their worth.

So where to? Social entrepreneurship is on the rise, our political system glimmers with possibility of a better day for more people-- and yet we know that day is many difficult days away. What cynics call an impossible utopia, one defined by mutual human interest, a respect for the humanity of the other which undeniably binds us together, where we recognize the responsibility of the individual to carry the community of all, the other, the neighbor, the stranger, in her heart. As our brilliant President Barack Obama said just a few days ago, "What the cynics fail to understand is that the ground has shifted beneath them - that the stale political arguments that have consumed us for so long no longer apply." I would amend Obama's statement by staying that the paradigm shift will reach and must reach ALL sectors, not only the political.

All cannot know immense currency-backed wealth-- for if it were-- currency would be forever relegated to worthlessness, a simple law of supply and demand. But love, this is an unlimited resource, one that can make even the most despondent full of worth, of wealth, of hope, of possibility.

The above quote was excerpted from a wholly fascinating article entitled The Dystopians.

Dystopia: An imaginary place or state in which the condition of life is extremely bad, as from deprivation, oppression or terror.
Dystopian: Of relating to a dystopia; dire, grim.
Utopia: An ideally perfect place, especially in its social, political and moral aspects.
Utopian: Of relating to a utopia; excellent or ideal but impracticable; visionary.

Dystopian and Utopian are inextricably related world views, one with an overly optimistic formulation and the other formed by sheer pessimism with regards to systems in their current state. But both are acknowledgments of broken systems that cannot be simply gorilla-glued back together; systems that are forever shattered and must be recomposed by a complete reconstitution of values. Competition, limited commodities, these require humans to fundamentally respond in kind with self-interest; it is the fight or flight mechanism, hard-wired for survival. The primacy of currency-backed economics means that while some are fighting for their stock portfolios, the rest are fighting for their lives.

Ben McGrath references three men each of whom are living a different take on a dystopian perspective. The first as mentioned above is Dmitry Orlov, who gave up his house and is living on a sailboat, a vessel he describes as his “survival capsule.” The second subject of the article is James Howard Kunstler, who in his weekly blog, “Clusterfuck Nation” most recently described the American public as “a public so demoralized by their own bad choices that the USA scene has devolved to a non-stop Special Olympics of everyday life, where absolutely everybody is debilitated, deluded, challenged, or needs a leg up, or an extra buck, or a pallet on the floor, or a gastric bypass, or a week in detox, or a head-start, or a fourth strike, or a $150-billion bailout.” And the struggles out in front of us as a quandary: “how do you re-shape [the American people] into a population guided by a sense of earnest purpose, with reality-based expectations, with habits of delayed gratification and impulse control, and a sense of their own history?” Good question.

The third man profiled in this article is Nassim Nicholas Taleb. Within The Dystopians, Taleb references a solution, or the inevitable paradigm shift as a reversion to “antiquity, a new classical era.” The problem with a sense that this shift is a “reversion,” especially when coming from someone such as Taleb, is that it implies an inescapable linear sense of time and space; forward or backward, future or history. What about recognizing that a classical age in 2009 is not a reversion but a reconstitution. Herein, we would gather tools used in and learned from a classical age and reconfigure their application to our current state of affairs. The toolbox upon which the U.S. has depended for much of the last century (at least), of dividends, debts, profits, etc., can no longer be applied to the problems of the U.S.; upon this all dystopians and utopians alike must agree.

Nassim Talib is author of The Black Swan a book about how “exceptional, unpredictable event[s]…carry a huge impact.” Talib describes himself on his blog Fooled By Randomness, in this way: “I am interested in how to live in a world we don’t understand very well—in other words, while most human thought (particularly since the enlightenment) has focused us on how to turn knowledge into decisions. I am interested in how to turn lack of information, lack of understanding, and lack of “knowledge” into decisions—how not to be a turkey.” Talib’s solution to avoiding Turkey-dom, is trial and error, to tinker. “We need more tinkering: uninhibited, aggressive, proud tinkering. We can be scared and worried about the future, or we can look at it as a collection of happy surprises that lie outside the path of our imagination…as we tinker, we have a capacity for choosing the best outcomes.” This tinkering requires immense flexibility of mind, body, and spirit. Perhaps this is why Talib lives by the ancient adage “you find peace by coming to terms with what you don’t know.”

If you are comfortable living in the world and owning what you do not know, is it not easier to respond to an unexpected situation with a solution that has a better outcome? Is this why Carolyn Baker, author of Sacred Demise: Walking the Spiritual Path of Civilization’s Collapse, is so excited by collapse? “ …that’s the exciting thing about collapse—the breaking down of barriers and definitions that don’t work anymore.” Perhaps those barriers and definitions never really stood with foundations to begin with, and were simply created post-facto as a rationalization for randomly occurring synchronicities.

1 comment:

  1. A friend responded to me directly about this posting. I think it's a very thoughtful response and so wanted to share it with you...Ok, so honestly, a lot of what I “believe economically,” or whatever, is summed up in this statement:

    “All cannot know immense currency-backed wealth-- for if it were-- currency would be forever relegated to worthlessness, a simple law of supply and demand.”

    Basically, for me, that is a very meaningful statement, and what it boils down to is this… the more in my pile NECESSARILY MEANS, the less in others’. Therefore, for me to behave in a way that I can justify, I must not have more than I need (so that there may be more to be distributed amongst the others who also need it). Recently, I have learned that at least a small buffer is required, in order for emergencies to be dealt with, but the buffer IS small, and can easily be calculated.

    I think a lot of economic problems boil down to ego. I believe a lot of problems, essentially, boil down to ego, but I believe money’s relationship to ego may be used as a model for many, if not most, cases.

    It is incredibly obvious, especially in american society, that people are “judged” on their wealth. It is taken for granted that if you have something great, you must have done something great to obtain it; a statement that I have found to be nearly ubiquitously useless and untrue. So, quite often, people surround themselves with things that they believe others will admire, in order to get some admiration for themselves. That is no surprise to me, as professionally, in our society, people have traditionally been forced to sell out many of their beliefs, in order to excel, financially. Possibly, the reason it is so easy for them to do this, is because it is not only their own ego depending on the actual number of dollars being earned, but also, every member of their family.

    In short, it is possible that many people have been forced to do things that are unsatisfying to them, and not only lack the traditional tools of pride and strength, that would normally serve to perpetuate a respectful relationship between human beings, especially family members, but also have been given this ability to justify this “wealth collecting” behavior (and by this I mean, collecting more than they need), societally (sic), by cloaking the motivation of a decision from ego reinforcement, to familial provision.

    “The primacy of currency-backed economics means that while some are fighting for their stock portfolios, the rest are fighting for their lives. “

    Why should this be?

    “I am interested in how to turn lack of information, lack of understanding, and lack of “knowledge” into decisions—how not to be a turkey.”

    Everyone knows how to do this. EVERYONE (yes, I have faith in humanity). I guess that is one question I wish more people asked themselves though: “how can i not be a turkey?”

    “If you are comfortable living in the world and owning what you do not know, is it not easier to respond to an unexpected situation with a solution that has a better outcome? Is this why Carolyn Baker, author of Sacred Demise: Walking the Spiritual Path of Civilization’s Collapse, is so excited by collapse? “ …that’s the exciting thing about collapse—the breaking down of barriers and definitions that don’t work anymore.” ”

    First,I am reminded of a quote from one of smooth’s Taoist books of short stories or something, when the butcher responds to a customer who is requesting their “best” cut of meat… “but, all our meat is best.” Doesn’t a “better” situation ALWAYS arise for someone who is better capable of dealing with it? So a “comfortable” person CREATES a better situation AND is better able to deal with it, partially because they played an active role in its creation in the first place. Also, ALL creation comes from destruction.

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