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An interesting excerpt from George’s Lakoff “Don’t Think of an Elephant!” 2014.

“Every language in the world has in its grammar a way to express direct causation. No language in the world has in its grammar a way to express systemic causation.

What’s the difference between direct and systemic causation?

From infanthood on we experience direct, simple causation. We see direct causation all around us: if we push a toy, it topples over; if our mother turns a knob on the oven, flames emerge. Picking up a glass of water and taking a drink is direct causation. Slicing bread is direct causation. Stealing your wallet is direct causation.

Any application or force to something or someone that produces an immediate change to that thing or person is direct causation: When causation is direct, the world cause is unproblematic. We learn direct causation automatically as children because that’s what we experience on a daily basis. Direct causation, and the control over our immediate environment that understanding it allows, is crucial in the life of every child. That’s why it shows up in the grammar of every language.

The same is not true for systemic causation. Systemic causation cannot be experienced directly. It has to be learned, its cases have to be studied, and repeated communication is necessary before it can be widely understood.

That’s right, no language in the world has a way in its grammar to express systemic causation. You drill a lot more oil, burn a lot more gas, put a lot more CO2 in the air, the earth’s atmosphere heats up, more moisture evaporates from the oceans yielding bigger storms in certain places and more drought and fires in other places, and yes, more cold and snow in still other places. The world ecology is a system – like the world economy and the human brain.

…click on the above link to read the rest of the article…

The Global Economy Could Fall Farther and Faster Than Pundits Expect

February 2, 2016

The Global Economy Could Fall Farther and Faster Than Pundits Expect

Systemic fragility doesn’t respond to central bank jawboning or Keynesian claptrap; unlike those “policy tools,” fragility is real.

The core narrative of central bank/cartel capitalism is centralized agencies have the power to limit downturns and extend credit-based “good times” almost indefinitely. The centralized power bag of tricks includes fiscal policies such as deficit spending to boost “aggregate demand” in downturns and monetary policies such as lowering interest rates to zero and buying assets, a.k.a. quantitative easing.

If we crawl under the barbed wire and escape the ideological Keynesian Concentration Camp, we find thinkers such as Ugo Bardi, John Michael Greer and Dimitry Orlov, whose work explores the dynamics of collapse, resilience and sustainability.

All three have added a great deal to my own (emerging) understanding of the many dynamics of collapse.

We can summarize the dynamics of collapse in many ways; here’s one: collapse is latent fragility manifesting. A familiar (and tragic) health analogy offers an example: a middle-aged man doesn’t appear ill, a bit thick around the middle perhaps, but neither he nor his intimates can see the fragility of his clogged arteries and blood-starved heart. Seemingly “out of the blue,” the man has a massive heart attack and passes from this Earth, to the shock of everyone who knew him.

Financial collapse isn’t “out of the blue,” any more than a heart attack is “out of the blue.” Actions and choices have consequences, and as resilience and redundancy are slowly stripped from complex systems, systemic fragility builds beneath the surface. At some difficult-to-predict point, a threshold is reached and the complex system fails.

In the financial realm, fragility builds as the system relies ever more heavily on marginal lenders, borrowers, buyers and investments for its “growth.”

…click on the above link to read the rest of the article…

A new blog dedicated to the Seneca Effect

February 1, 2016

A new blog dedicated to the Seneca Effect

The Seneca Trap is a repository of the posts dedicated to the “Seneca Effect” that appeared, and will appear, on “Cassandra’s Legacy

The idea of collapse is bad enough for most people when it deals with the running out of mineral resources along the symmetrical “bell shaped” Hubbert curve. But there is an extra dimension to collapse: it is the “Seneca Effect” (or “Seneca Trap”, or also “Seneca Cliff”) that notes how, most often, when things start going bad, they go bad fast – even very fast.

So, a few years ago I started mulling over this idea, also as the result of a question that Dmitry Orlov had posed to me. I also remembered something that the ancient Roman Philosopher Seneca had written and that a friend of mine (Luca Mercalli) had pointed out to me. The result was the “Seneca Collapse model,” one of a series that I call “mind sized” simple models.

The basic idea of the Seneca Model, as I implemented it, is that a complex system, such as a whole civilization, does not collapse just because it runs out of resources, but also because of side effects related to the consumption of these resources, effects that we would call today “pollution”. Trapped in between depletion and pollution, the system collapses even faster. This is why I call the effect also the “Seneca Trap”.

After I had developed that first model, I discovered that the phenomenon may be more complex and that there are many real-world systems that can be considered as affected by the Seneca Trap. It can be applied, in particular, to fisheries. On the whole, it is a fascinating subject that I am still exploring.
…click on the above link to read the rest of the article…

Sociocultural Boundaries

October 6, 2015

Sociocultural Boundaries

Some years ago now a team of Swedish scientists proposed an interesting framework for understanding planetary environmental problems. It generated a range of responses from the environmental community, mostly positive. I had what is undoubtedly a very unusual response to their framework, and while it is perhaps old news, it may still be useful to present it here. As an anthropologist, I see planetary problems from a cultural and evolutionary perspective that could offer a different take on the subject.

Estimates of how the different control variables for seven planetary boundaries have changed from 1950 to present. The green shaded polygon represents the safe operating space. Source: Steffen et al. 2015 — Estimates of how the different control variables for nine planetary boundaries have changed from 1950 to present. The green shaded polygon represents the safe operating space. Source: Steffen et al. 2015

First, though, I want to say that the identification of the nine interrelated environmental ‘boundaries’ has been unquestionably of great value (Planetary Boundaries). Raising awareness about the problems and emphasizing nonlinear feedbacks effects, and so the possible triggering of abrupt global environmental changes, are integral to a more sophisticated discussion of climate change and the other problems they highlight. To list them, they are climate change, ocean acidification, ozone depletion, nutrient fluxes, global freshwater use, land use change, biodiversity loss, aerosol loading, and chemical pollution.

SteffenExponential — The great acceleration of the Anthropocene. Source.

The nine ‘boundaries’ are concisely represented in their popular diagram. The green space in the center represents the safe operating values. If the wedge exceeds the green space then it has already crossed its threshold and become a threat of flipping to a disastrous state for our human presence on the planet. Worse, the problems are interrelated and interactions are a grave threat. As an example of dangerous interactions, loss of soil moisture, degradation of land to new land types, and biodiversity loss all reduce the ability of ecosystems to sequester CO2, and thus increase greenhouse effects.

…click on the above link to read the rest of the article…

The Permaculture City: Cities as Complex Systems

September 8, 2015

The Permaculture City: Cities as Complex Systems

The following sections are excerpted with permission from Chapter 1 of Toby Hemenway’s new book The Permaculture City, published by Chelsea Green.

When a permaculturist sees words such as “function” and “synergy,” it sets off lightbulbs in his or her head. Function, for example, indicates a relationship, a connection between two or more elements. A road functions to move traffic, thus the road has a relationship with vehicles, and it mediates the movement—that is, it makes connections—between the traffic, its origin, and its destination. Knowing a function, in turn, leads us to identify the items and processes necessary to fill that function and also points to the yields created when that function is filled. Thinking in terms of functions, then, is a powerful leverage point, because it identifies needs, yields, relationships, and goals, and it helps us spot blockages, missing elements, buildup of waste, and inefficiencies in the various flows and linkages that are part of that function’s workings.

This means that when we look at cities, their residents, and the other components of urban life in terms of their functions, we can spot the factors that influence how well they are able to perform those functions. Then we can study, understand, and direct those factors and influences in ways that will create and enhance the functions and properties of cities that are beneficial, such as community-building public plazas, parks, and structures; open and supportive marketplaces; and habitat-creating green space; as well as human elements such as responsive policy processes. We can also spot and damp down the negative factors. Once we’ve done this, the next step is to evaluate, to see how well our changes have moved us toward a more livable, and life-filled, environment. That is the heart of design.

…click on the above link to read the rest of the article…

China: Doomed If You Do, Doomed If You Don’t

September 1, 2015

China: Doomed If You Do, Doomed If You Don’t

Whichever option China chooses, it loses.

Many commentators have ably explained the double-bind the central banks of the world find themselves in. Doing more of what’s failed is, well, failing to generate the desired results, but doing nothing also presents risks.

China’s double-bind is especially instructive. While there an abundance of complexity in China’s financial system and economy, we can boil down China’sdoomed if you do, doomed if you don’t double-bind to this simple dilemma:

If China raises interest rates to support the RMB ( a.k.a. yuan) and stem the flood tide of capital leaving China, then China’s exports lose ground to competing nations with weaker currencies.

This is the downside of maintaining a peg to the U.S. dollar. The peg provides valuable stability and more or less guarantees competitive exports to the U.S., but it ties the yuan to the soaring dollar, which has made the yuan stronger simply as a consequence of the peg.

But if China pushes interest rates down and floods its economy with cheap credit, the tide of capital exiting China increases, as everyone attempts to escape the loss of purchasing power as the yuan is devalued.

This is the double-bind China finds itself in: weakening the yuan to shore up exports incentivizes capital flow out of China, forcing the central bank to torch reserves to mediate the flood tide of capital fleeing China.

But efforts to support the yuan crush exports based on a cheap currency, creating the potential for mass layoffs in sectors with razor-thin margins and convoluted black box financing. Nobody knows how many times the stuff in warehouses has been pledged as collateral, or how much debt is floating around the shadow banking system in China.

Forget the Fake Statistics: China Is a Tinderbox (August 10, 2015)

…click on the above link to read the rest of the article…

It Just Doesn’t Matter

August 31, 2015

It Just Doesn’t Matter

When an avalanche is about to descend upon you, does it really matter which snowflake was the penultimate cause?

While it’s interesting (in a mental masturbation kind of way) to debate the genesis of a pending market collapse, environmental chaos, or energy cliff, in the end, it really doesn’t matter–unless, of course, we are able to curtail the impending crises by correctly identifying the variable(s) involved and mitigating the consequences, but the likelihood of that outcome is looking increasingly unlikely as systems are prone to overshoot and collapse.

One of the ‘insights’ I’ve had over the past several months as I read the competing narratives that are floating about the globe and attempting to ‘explain’ why the dilemmas we are facing are happening is that we really don’t understand complex systems and the way they behave, so we are bound to cling to simple explanations that support our personal biases and reduce the cognitive dissonance that results when our belief system is challenged.

A large part of the problem, I believe, in discerning which variable(s) play(s) the most impactful role in creating a crisis is the tendency for various interest groups to spin the ‘facts’ to support their particular narrative.

For example, whether the cause of the oil/commodity price collapse is the role of central banks in manipulating the economic system, the limits to growth, overproduction (by Saudi Arabia? US shale? Canadian oil sands?), and/or economic contraction (global? Europe? China? emerging markets?), the result is a loss of thousands of jobs, domestic unrest, and increasing geopolitical tension as nations try to counter the deflationary collapse that appears to be resulting. Many Western politicians and journalists are pointing the finger at the production levels of the Middle East, particularly Saudi Arabia, and their ‘refusal’ to cut production, but data from the past decade shows that supply has increased significantly because of US shale and Canadian oil sands extraction rather than that of Saudi/ME. It strikes me that this ‘spin’ is simply a means of avoiding looking in the mirror and deflecting attention–blaming ‘others’ for our woes is a common means of reducing cognitive dissonance, focusing citizen outrage away from their ‘leaders’, and justifying particular actions/decisions.

In the end, however, the ’cause’ is not that important to the families crushed by a sudden loss of income. And that brings me to the conclusion of this little diatribe: being prepared for whatever comes our way is the only thing that might really matter. Whether at an individual, family, or local community level–I don’t believe it’s possible or prudent to worry much beyond these–being resilient and resourceful in the coming months/years is what is going to make a difference as to how ‘successful’ one can deal with the coming dilemmas.

Best of luck to everyone. I think we’re going to need it.

Steve

In the 1979 comedy, Meatballs, actor Bill Murray provides a ‘motivational’ speech to his fellow summer camp counsellors and campers who are getting soundly beaten in a ‘friendly’ competition by a neighbouring camp: https://www.youtube.com/watch?v=6UZvIZAHjlY. In the end, the speech is seen not as motivational but as a message that, in the bigger picture, the competition really doesn’t matter–(SPOILER ALERT) all the good-looking girls are going to go out with the other camp’s counsellors anyways because they have all the money!

Progress in an Uncertain World

August 19, 2015

Progress in an Uncertain World

Strong Towns is often accused of offering doom-and-gloom diagnoses of problems but being light on solutions. “You don’t tell us what we can actually DO to fix our insolvent cities,” goes the response. “You’re just so negative all the time.” This is not true, but I also don’t think it’s true that these criticisms are made in bad faith.

Rather, I think we have articulated a vision of what should be done to build Strong Towns, and done so in great detail. But that vision is heavy on experimentation and small-scale risk-taking (with potentially great rewards). It is heavy on civic engagement and grassroots action. And it is notably light on technocratic policy interventions: to the extent we talk about policy, it’s often about what policy makers should NOT do, not what they should.

There is a good reason for this, and those with a technocratic mindset (i.e. that the problems of cities will be fixed by top-down, data-driven policy tinkering) would do well to consider it.

The City as Ecosystem

Chuck occasionally has called mathematician and risk analyst Nassim Nicholas Taleb the “patron saint of Strong Towns thinking.” I strongly urge anyone who has not read Taleb to pick up his books—Antifragile if you’re only going to read one, but also Black Swan and Fooled by Randomness. They are deeply intellectual and cross-disciplinary, but not overly wonky: accessible and entertaining for non-academic readers.

The central thesis of Taleb’s work is that complex systems are inherently unpredictable and prone to “Black Swan” events: unforeseeable and unprecedented cataclysmic changes. It’s not that we haven’t figured out yet how to completely predict their behavior; it’s that it is far from even mathematically possible for us to do so. Think of a natural ecosystem. Global weather patterns. The stock market. The human body. A city.

…click on the above link to read the rest of the article…

Why is it So Hard for the West to See Everything is Connected?

August 14, 2015

Why is it So Hard for the West to See Everything is Connected?

QUESTION: Marty, you have written many times how everything is connected and how in Asian culture that is the foundation of all understanding. Why is it so hard in the West to comprehend this fundamental concept?

All the best

ANSWER: I think it is all part of the idea that we can alter society forcing it to do as we desire. Politics is based upon this. Socialism is all about robbing one class to benefit the other. There is no comprehension that everything is connected and this permeates analysis as well. This is not my personal discovery for many have seen these connections in Eastern Philosophies. I think in economics, politicians are not interested in such realizations for it means they are not the masters of the universe.

You take Obama’s policy against Russia. He has effectively been disrupting everything around Europe and the consequences are pouring in refugees to Europe and his sanctions have hurt European farmers and the economy. It is not deliberate, but it is reckless for there is no recognition of how everything is connected.

Every action has a consequence. We have the Fed lowered rates to help the banks. But that crisis is over and the consequence has been to create the next crisis – the defaults of pensions and insurance companies that required high interest rates. So many regulations required pension funds to own government bonds. The regulations have set the stage for the next crisis.

We cannot escape this connectivity. Whatever action we take has a consequence. It is impossible to manipulate markets and the economy for there will always be unintended collateral damage. We are living in the era that will bring about a collapse of socialism precisely as took place in communism. Government is incapable of ever managing society for they cannot escape the inter-connectivity.

Wicked problems and wicked solutions: the case of the world’s food supply

July 13, 2015

Wicked problems and wicked solutions: the case of the world’s food supply

Can you think of something worse than a wicked problem? Yes, it is perfectly possible: it is a wicked solution. That is, a solution that not only does nothing to solve the problem, but, actually, worsens it. Unfortunately, if you work in system dynamics, you soon learn that most complex systems are not only wicked, but suffer from wicked solutions (see, e.g.here).

This said, let’s get to one of the most wicked problems I can think of: that of the world’s food supply. I’ll try to report here at least a little of what I learned at the recent conference on this subject, jointly held by FAO and the Italian Chapter of the System Dynamics Society. Two days of discussions held in Rome during a monster heat wave that put under heavy strain the air conditioning system of the conference room and made walking from there to one’s hotel a task comparable to walking on an alien planet: it brought the distinct feeling that you needed a refrigerated space suit. But it was worth being there.

First of all, should we define the world’s food supply a “problem”? Yes, if you note that about half of the world’s human population is undernourished; if not really starving. And of the remaining half, a large fraction is not nourished right, because obesity and type II diabetes are rampant diseases – they said at the conference that if the trend continues, half of the world’s population is going to suffer of diabetes. That’s truly impressive, if you think about that for a moment.

So, if we have a problem, is it really “wicked”? Yes, it is, in the sense that finding a good solution is extremely difficult and the results are often the opposite than those intended at the beginning. The food supply system is a devilishly complex system and it involves a series of cross linked subsystems interacting with each other.

…click on the above link to read the rest of the article…

Welcome to Blackswansville

July 7, 2015

Welcome to Blackswansville

While the folks clogging the US tattoo parlors may not have noticed, things are beginning to look a little World War one-ish out there. Except the current blossoming world conflict is being fought not with massed troops and tanks but with interest rates and repayment schedules. Germany now dawdles in reply to the gauntlet slammed down Sunday in the Greek referendum (hell) “no” vote. Germany’s immediate strategy, it appears, is to apply some good old fashioned Teutonic todesfurcht — let the Greeks simmer in their own juices for a few days while depositors suck the dwindling cash reserves from the banks and the grocery store shelves empty out. Then what?

Nobody knows. And anything can happen.

One thing we ought to know: both sides in the current skirmish are fighting reality. The Germans foolishly insist that the Greek’s meet their debt obligations. The German’s are just pissing into the wind on that one, a hazardous business for a nation of beer drinkers. The Greeks insist on living the 20^th century deluxe industrial age lifestyle, complete with 24/7 electricity, cheap groceries, cushy office jobs, early retirement, and plenty of walking-around money. They’ll be lucky if they land back in the 1800s, comfort-wise.

The Greeks may not recognize this, but they are in the vanguard of a movement that is wrenching the techno-industrial nations back to much older, more local, and simpler living arrangements. The Euro, by contrast, represents the trend that is over: centralization and bigness. The big questions are whether the latter still has enough mojo left to drag out the transition process, and for how long, and how painfully.

…click on the above link to read the rest of the article…

Kondratiev Goes Surfing

May 31, 2015

Kondratiev Goes Surfing

“Excursions from the comfort of the normal to the uncertainty of the new typically happen brutally and violently.”

We read recently in aSouthern California newspaper that climate change may wreck the shape and direction of waves that make for some of the world’s best surfing beaches. We wondered if it might have a similar effect on Kondratiev cycles.

Our species now has to focus on three overarching tasks:

switching away from fossil energy and onto renewables;
degrowing industrial dependencies and shedding our profligate ways in a very resource-constrained new environment; and
mending the damage we’ve done by undertaking massive works of ecological restoration – returning us to a garden planet and restoring Gaia to her full health.

Among collapsologists, the surfing analogy works at several levels. Instead of passively observing tsunami-size Kondratiev and Elliott waves pound civilization to rubble, we can get out and ride those waves. We are not destroying anything to have our fun. Its renewable energy. We are degrowing our footprint, which is growing hope in inverse proportion. Surfing hits our dopamine receptors. With newfound friends, in ecovillages and organic farming collectives, this big wave surfing can be a lot of fun.

“Surfing is a very experiential or ‘now’ activity,” a surfer recently told the San Jose Mercury News. “When waves die in one spot and pick up in another, you move to that spot.” This is the phenomenon Kevin Kelly described as “scenius,” observing that throughout history certain geographical areas attract creative human energies, often passing into and out of their heyday with unexpected suddenness. As Benoit Mandelbrot says, “Wave prediction is a very uncertain business.”

…click on the above link to read the rest of the article…

The systems view of life – a unifying vision (part 2)

May 4, 2015

The systems view of life – a unifying vision (part 2)

In this episode I have the great honor of connecting with scientist, educator, activist, and author Fritjof CapraP.hd. He was born in Vienna, and studied physics and systems theory, and became well known for his first book,The Tao of Physics (1975). In this book, and in his subsequent work, he has explored the ways in which modern physics has changed our worldview from a mechanistic to a holistic and ecological one. Synthesizing various schools of thought and practice has been on of his prime interests. Together with his friend and colleague Professor Pier Luigi Luisi, who has also been a guest on this show, he has published a groundbreaking book titled the Systems View of Life – A Unifying Vision (2014). We base our dialogue on the perspectives put forth in this book, and with a special emphasis on how his work ties into that of Arne Næss and deep ecology. Also, I’m glad to announce that Capra will be in Norway May 19, at the University of Nordland, Bodø. He will also conduct a 6-week teaching tour through Europe in relation to the publication of his book, so check his schedule for more information on this. Feel free to contribute with your own reflections below the interview, and please share this resource with people who might be interested.

(4:00) Ove Jakobsen and ecological economy
Connecting to the Norwegian context, Capra mentions his friendship with Professor Ove Jakobsen at the University of Nordland, Bodø. Jakobsen has been an important advocate for ecological economics, or circular economics, and it’s this dialogue and exploration they intend to investigate further when they meet in May. Capra points out that the ideas embedded in the systems view of life correspond in many ways to what Jakobsen has found out in his own field of study.

…click on the above link to read the rest of the article and listen to the podcast…

Keep It Simple And Complex, Stupid

April 26, 2015

Keep It Simple And Complex, Stupid

My last post supporting the use of nonlinear models (“You Do Need A Weatherman”) generated some thoughtful responses, mainly along the lines of this post by Ari Andricopoulos entitled “A View on the Economic Model Debate from a Non-economist (but someone who builds models for a living)”. The basic argument is that a full nonlinear model of any significant economic process would be too complicated, and that it was better therefore to stick with tractable linear models, while keeping in mind that the real world is nonlinear:

I build models with data for a living, and I am acutely aware of the problems with using non-linear models to make any sort of accurate predictions – even with huge volumes of data to calibrate it with.

It is not that the systems are linear. They are hugely complex. My problem is that they are too complex to model even with non-linear models. My belief is that linear models do have to be used but with a full understanding of the non-linearity of real life. Also, the whole building of macro-models from first principles, based on ‘rational’ agents, is a complete joke of a way to design a model that is supposed to be used in the real world.

While these points have some validity (especially Ari’s jibe at “rational agent” models), this criticism approaches complex systems from the wrong end—the “complicated” as opposed to “complex” end. A core lesson from complex systems analysis (dating right from its first discovery by Poincare back in 1899, and manifest in the first simulation of a complex system by Lorenz in 1963) is that a simple system can demonstrate complex behaviour. And a simple complex system—yes, I know that sounds like an oxymoron, but bear with me—can tell you most of what you need to know about a complicated complex system.

…click on the above link to read the rest of the article…

We Ignore Unintended Consequences At Our Peril

January 30, 2015

We Ignore Unintended Consequences At Our Peril

They’ll likely define our future more than the intended ones

Early in my business career, I was faced with a challenge that gave me an appreciation for a critical lesson about life and business. It’s that oftentimes, even with the best of intentions, our actions create consequences completely different from what we intend.

It’s that insight that makes me so concerned about the grand central banking experiment being conducted around the globe right now. With little more than a lever to ham-fistedly move interest rates, the central planners are trying to keep the world’s debt-addiction well-fed while simultaneously kick-starting economic growth and managing the price levels of everything from stocks to housing to fine art.

As with an earlier article I wrote focusing on the Bullwhip Effect phenomenon: the complexity of the system, the questionable credentials of the decision-makers, and the universe’s proclivity towards unintended consequences all combine to give great confidence that things will NOT play out in the way the Fed and its brethren are counting on.

A Puzzle To Solve

Two years after graduating business school, I joined the team at Yahoo! Finance as its Marketing lead. It was a crazy time there; the tech bubble was in mid-burst and advertiser dollars — the main source of revenue for the business unit — were fast drying up. We went through several general managers within my first year there as the leadership scrambled for a sound course to chart.

…click on the above link to read the rest of the article…

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