Weekly Musings 5-21-11
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For those who are new to the Musings: they are basically a glimpse into my notebook, the unfiltered swamp where I organize future themes, sort through the dozens of stories and links submitted by readers, refine my own research and start connecting dots which appear later in the blog or in my books.
Is The Acceptance of Digital Technology Increasing Systemic Vulnerability?
I had a long conversation today with my friend of 40 years, G.F.B., in which he made a fascinating and persuasive case for the idea that the speed and oversized impact of digital technologies is vastly increasing our vulnerability to disruptive change.
I took pages of notes (yes, highly analog and not at all digital) and am digesting the far-reaching consequences of these ideas.
One of G.F.B.'s key points (and I paraphrase) is that digital technology doesn't control us per se, but our acceptance of its high-speed pace as "the way we live now" has far-reaching and not always positive consequences.
Thus it is our acceptance and embrace of digital technology's pace and reach that is creating unseen vulnerabilities.
In my view, one consequence is the extreme vulnerability of global supply chains. Relentless globalization and efficiencies driven by digital technology have led to extremely long and fragile supply chains. Thus the tsunami and earthquake in Northern Tohoku (Japan) has caused disruptions in the entire global auto manufacturing industry.
I will be writing more about this in the future. Interestingly, this analysis is entirely non-ideological. "Left" and "Right" have nothing to do with this dynamic. It supercedes the petty ideological spectacle which is presented as "meaningful" and as a "choice." (It is neither.) Politics is incessantly presented as the driver of "change" but political machinations are mostly responses to changes triggered by digital technologies.
The Cycle of Dependency on Central Authority and the Atrophy of Self-Reliance
As I work on my new book "An Unconventional Guide to Investing in Troubled Times" (known in my journal by the acronym AUGIITT) I have been studying the idea that societies and economies cycle through growth, sclerosis and decline not just from the marginal return created by over-complexity--the thesis presented by Tainter et al.--but from an unremarked cycle of rising dependency on the Central State or Authority for meaning, purpose and "bread and circuses."
The model for this thesis is of course the Roman Empire, which experienced an atrophying of enterprise and innovation as the Empire increased its taxation and reliance on "bread and circuses," literally free bread and entertainment distributed to roughly 40% of the population of Rome.
Coincidentally,
Mish published a "Dependency Ratio" which shows the nation's rapidly rising dependence on the Central State's authority and borrowing ($1.6 trillion a year nowadays).
I strongly suspect that rising dependence on the Savior State and declining self-confidence and self-reliance are on a see-saw: as dependence rises, self-confidence and self-reliance fall.
What ensues is a classic destructive dynamic of co-dependence in which the supplicants demand more even as they are resentful of their increasing dependence.
The Central State eventually taxes the productive citizenry into penury, as the poor are dependents and the wealthy escape taxation via favoritism/crony capitalism. This certainly tracks the decline of the Roman Empire.
It seems clear to me that the U.S. is in the final stages of just such a dependency cycle that will end in the implosion of the Central "Savior State" as its obligations far exceed the economy's ability to generate surpluses on that immense scale.
Links on Food
We all know that the planet's population of humans is in overshoot mode, stressing the world's resources to the breaking point. Food production depends on water, oil (for transport and fertilizer), soil and non-renewable fertilizers such as potash, all of which are inadequate and/or nonrenewable.
Here are some interesting links relating to food production and the vulnerability of the global food production and supply system:
From Left Field
An interesting site which creates a topic "word cloud" based on your tweets: mirror.me
If you know thename of one of those Orange County lifeguards pulling down $220,000 a year, you can look up their salary with this database.
I looked up the University of California Professors I know; top salary was $126,000 a year. The math professor makes $76,000 a year. The lifeguards make more than twice as much and have a much better tan.
It would be so refreshing to read an interview with a U.S. politician that was 1/10th as knowledgeable and honest as this Green Party of Germany elected official (who is 62 years of age):
'I Want a Quiet Revolution'
Alas, American politicos are trapped in a time warp in which they only spout cliches from either the 1930s or the 1980s. They completely ignore the reality that our entire way of life and our economy are unsustainable. This gent gets it, and isn't afraid to speak the truth.
This week's quote: "We must believe in luck. For how else can we explain the success of those we don't like?" (Jean Cocteau)
Thank you for reading--
charles
