Tuesday, February 9, 2016
Sunday, May 10, 2009
Social Engineering traps
The unintended consequences of social engineering
May 10, 2009
This subject has been approached from several angles like the projects creating criminal and drug refuges to welfare creating a permanent underclass. I would like to expose another unintended consequence that will be appearing in the future.
I started thinking about a new rule the NCAA is studying to impose which requires colleges to interview at least 1 minority candidate. On the surface this appears to be a no-brainer. Actually, I am surprised such a rule does not exist; after all, the NFL adopted the ‘Rooney Rule’ in the eighties. I would have expected the NCAA to adopt a similar rule by now. I always forget the NCAA is the epitome of the good ‘ol boy’s networks that allows nepotism to penetrate every level of the bureaucracy or hypocrisy. This new rule is aimed at helping black candidates receive consideration for top coaching jobs at top schools.
The hitch in the step is, if estimates are correct, the Hispanic population will be the majority ethnic/racial ancestry in the next 10 to 20 years. Imposing this rule and similar civil rights rules will require potential employers to include white coaches in there searches and hiring practices or face sanctions. What effect will this rule have at the traditionally black schools (you know, the fact that we have what are referred to as traditionally black colleges and the black college football championship spits in the face of civil rights reform. Think about it, if the ivy-league champion was named the traditionally white college champion, there would be a protest or two. I just don’t understand why the moniker of traditionally black school has not been changed.) Will Grambling be required to have a white coach? It depends on how the rule is written and whether the rule is evenly enforced.
You know the path to destruction is paved with good intentions. I do not question the intent of the NCAA but the NCAA, as the rest of society does, need to be careful when engaging in social engineering. It tends to lead to bad unintended consequences. Urban planners of the 1950’s to today decided to create housing projects in urban centers near manufacturing centers for low income people. This effort created a segregated area of low income people in a poor job market in the 1970’s. These areas had higher unemployment rates leading to crime and dysfunctional society. The intent was well placed and the idea was well meaning but the outcome was unforeseen and unfortunate.
It is very difficult to predict how a complex system will react when an artificial stimulus is added. All complex systems behave chaotically and it’s the nature of chaos which makes it hard to predict outcomes from stimulus. The environmental field has several examples of trying to stimulate a system or engineer a complex system and not foreseeing the trap that lies ahead. Anyone remember rabbits in Australia????
The Green Elephant
May 10, 2009
This subject has been approached from several angles like the projects creating criminal and drug refuges to welfare creating a permanent underclass. I would like to expose another unintended consequence that will be appearing in the future.
I started thinking about a new rule the NCAA is studying to impose which requires colleges to interview at least 1 minority candidate. On the surface this appears to be a no-brainer. Actually, I am surprised such a rule does not exist; after all, the NFL adopted the ‘Rooney Rule’ in the eighties. I would have expected the NCAA to adopt a similar rule by now. I always forget the NCAA is the epitome of the good ‘ol boy’s networks that allows nepotism to penetrate every level of the bureaucracy or hypocrisy. This new rule is aimed at helping black candidates receive consideration for top coaching jobs at top schools.
The hitch in the step is, if estimates are correct, the Hispanic population will be the majority ethnic/racial ancestry in the next 10 to 20 years. Imposing this rule and similar civil rights rules will require potential employers to include white coaches in there searches and hiring practices or face sanctions. What effect will this rule have at the traditionally black schools (you know, the fact that we have what are referred to as traditionally black colleges and the black college football championship spits in the face of civil rights reform. Think about it, if the ivy-league champion was named the traditionally white college champion, there would be a protest or two. I just don’t understand why the moniker of traditionally black school has not been changed.) Will Grambling be required to have a white coach? It depends on how the rule is written and whether the rule is evenly enforced.
You know the path to destruction is paved with good intentions. I do not question the intent of the NCAA but the NCAA, as the rest of society does, need to be careful when engaging in social engineering. It tends to lead to bad unintended consequences. Urban planners of the 1950’s to today decided to create housing projects in urban centers near manufacturing centers for low income people. This effort created a segregated area of low income people in a poor job market in the 1970’s. These areas had higher unemployment rates leading to crime and dysfunctional society. The intent was well placed and the idea was well meaning but the outcome was unforeseen and unfortunate.
It is very difficult to predict how a complex system will react when an artificial stimulus is added. All complex systems behave chaotically and it’s the nature of chaos which makes it hard to predict outcomes from stimulus. The environmental field has several examples of trying to stimulate a system or engineer a complex system and not foreseeing the trap that lies ahead. Anyone remember rabbits in Australia????
The Green Elephant
Monday, February 16, 2009
keynes stimulus+trade deficit=bankrupt
Keynsian economic policy states, and I am summarizing, 'Economies can be guided and/or controlled by governments and any government spending is good for the economy' On the surface this seems like a decent premise. Government controls tariffs, international trade agreements, interstate/province trade, monetary policy, banking and finance regulation and tax policy. The government is also not for profit, so when an economy is tanking the government can inject massive spending to help support private enterprise until the private economy recovers.
Any spending should work. Welfare injects capital into the retail and utility sectors. Food programs can augment agriculture. Housing projects can prop up real estate and building. Infrastructure can support heavy machinery, engineering, steel, mining and construction. You get the picture. But why does it not seem to work. Japan spent vast amounts in the 1990's and are still suffering. We spent large amounts in 2000-now and it does not seem to budge the economy in any great direction. The only time it seemed to work was under Reagan in the 1980's.
The reason this system does not work is globalization of markets and commodities. Something that was configured differently during Keynes hayday. I will explain after a quick example. Think about high payout slot machines and why the house always ends up with the majority of the money. A slot machine paying out 95% should return 95% of the bets to the gamblers over time. Which seems on the surface like a gambler loses only 5% of there monies. The problem is the gambler is losing every time money is put in the machine. Even over time the gambler loses. on average, 5% of the money bet. 100 dollars becomes 95 after 1 bet. 95 becomes 90.25 and so on, until nothing is left.
During Keyens time, raw resources were extracted from outside markets and brought into the domestic market for manufacture of finished goods. These goods were then returned to outside markets for sale or domestic sale. This scenario yielded a net gain in trade. As foreign markets demand grew and labor, health, tax, energy, etc. costs escalated in the industrialized economies, the means of production were shifted closer to the resource base. Finished products were now being shipped to inside the economy which begins a trade deficit. As globalization continues through consolidation and mergers, more components in a once encapsulated economy become outside the domestic economy. Now, money spent by the government does not necessarily stay inside the domestic economy with the same velocity.
This is the crux of why Keynesian economics has not worked in recent times. Government dollars that were once spent 5 to 10 times inside the domestic economy may be spent only once, before being exported to outside the economy. So, why did it work for Reagan? Reagan increased spending on defense. Most defense spending, especially R&D and advanced weapon systems, was spent entirely in the U.S. during the 1980's. Today, manufacture can happen overseas on certain systems, but most of the R&D and advanced weapons are still fully developed in the U.S. It is hidden protectionism that no other country would protest. The technical engineers and designers of the 1980's were mainly U.S. citizens or nationals. Today, there is export of pay as more foreign nationals work in defense.
Infrastructure spending does not build an economy, either. The engineering firm may be international, the steal is produced overseas and many components of the heavy machinery is from international markets. The high velocity dollars spent on infrastructure are contained in the workers salary and the ancillary services built on their pay. However, the money spent on food and household items by the workers soon leaves the domestic economy as well. Textiles and household items are mainly made overseas and depending on the season, many food items come from international agriculture.
It is like playing the slots. Every time the government injects stimulus into the economy, there is less left in the economy. As our government is running huge deficits, the money being injected is from other sources besides the treasury. We are in effect using a line of credit in a casino and putting all back into the slot machine. As we do this over and again, the line of credit seizes and the domestic economy becomes bankrupt.
With little manufacturing base or resource base to fuel a 'homegrown' economy, we can find ourselves slipping into the second or third world. The government already can not satisfy the social contract and commitments made to social security and medicare in the future. How can we possibly satisfy these commitments while we continue down the road of Keynes. We need to find a sustainable economy that is in equilibrium with our means of production.
As a nation, we are addicted to consumption. We purchase for the thrill or to fulfill an emotion more then to fulfill a true need. As a nation we need to reduce conspicuous consumption. 2/3 of our economy is from consumptive spending. Judging by sales of automobiles and durable goods, this consumption is on small insignificant low quality junk that will need to be thrown away and replaced by more cheap junk. To move the economy to sustainability, we need to consume and produce quality goods that can be fixed or kept for many years. The economy won't show record growth but it will be balanced without showing record declines either. We also need to ease away from credit spending and move to a cash society. Back to scrimping and saving to make big ticket purchases. The effects won't be felt domestically too much from moving back to cash. Manufacturing is done externally and the banks and credit markets are already at historic lows. Overtime, using these strategies toward household spending will bring our economy back and pride in buying quality goods made by skilled labor-not sweatshops.
The green elephant attacks again
Any spending should work. Welfare injects capital into the retail and utility sectors. Food programs can augment agriculture. Housing projects can prop up real estate and building. Infrastructure can support heavy machinery, engineering, steel, mining and construction. You get the picture. But why does it not seem to work. Japan spent vast amounts in the 1990's and are still suffering. We spent large amounts in 2000-now and it does not seem to budge the economy in any great direction. The only time it seemed to work was under Reagan in the 1980's.
The reason this system does not work is globalization of markets and commodities. Something that was configured differently during Keynes hayday. I will explain after a quick example. Think about high payout slot machines and why the house always ends up with the majority of the money. A slot machine paying out 95% should return 95% of the bets to the gamblers over time. Which seems on the surface like a gambler loses only 5% of there monies. The problem is the gambler is losing every time money is put in the machine. Even over time the gambler loses. on average, 5% of the money bet. 100 dollars becomes 95 after 1 bet. 95 becomes 90.25 and so on, until nothing is left.
During Keyens time, raw resources were extracted from outside markets and brought into the domestic market for manufacture of finished goods. These goods were then returned to outside markets for sale or domestic sale. This scenario yielded a net gain in trade. As foreign markets demand grew and labor, health, tax, energy, etc. costs escalated in the industrialized economies, the means of production were shifted closer to the resource base. Finished products were now being shipped to inside the economy which begins a trade deficit. As globalization continues through consolidation and mergers, more components in a once encapsulated economy become outside the domestic economy. Now, money spent by the government does not necessarily stay inside the domestic economy with the same velocity.
This is the crux of why Keynesian economics has not worked in recent times. Government dollars that were once spent 5 to 10 times inside the domestic economy may be spent only once, before being exported to outside the economy. So, why did it work for Reagan? Reagan increased spending on defense. Most defense spending, especially R&D and advanced weapon systems, was spent entirely in the U.S. during the 1980's. Today, manufacture can happen overseas on certain systems, but most of the R&D and advanced weapons are still fully developed in the U.S. It is hidden protectionism that no other country would protest. The technical engineers and designers of the 1980's were mainly U.S. citizens or nationals. Today, there is export of pay as more foreign nationals work in defense.
Infrastructure spending does not build an economy, either. The engineering firm may be international, the steal is produced overseas and many components of the heavy machinery is from international markets. The high velocity dollars spent on infrastructure are contained in the workers salary and the ancillary services built on their pay. However, the money spent on food and household items by the workers soon leaves the domestic economy as well. Textiles and household items are mainly made overseas and depending on the season, many food items come from international agriculture.
It is like playing the slots. Every time the government injects stimulus into the economy, there is less left in the economy. As our government is running huge deficits, the money being injected is from other sources besides the treasury. We are in effect using a line of credit in a casino and putting all back into the slot machine. As we do this over and again, the line of credit seizes and the domestic economy becomes bankrupt.
With little manufacturing base or resource base to fuel a 'homegrown' economy, we can find ourselves slipping into the second or third world. The government already can not satisfy the social contract and commitments made to social security and medicare in the future. How can we possibly satisfy these commitments while we continue down the road of Keynes. We need to find a sustainable economy that is in equilibrium with our means of production.
As a nation, we are addicted to consumption. We purchase for the thrill or to fulfill an emotion more then to fulfill a true need. As a nation we need to reduce conspicuous consumption. 2/3 of our economy is from consumptive spending. Judging by sales of automobiles and durable goods, this consumption is on small insignificant low quality junk that will need to be thrown away and replaced by more cheap junk. To move the economy to sustainability, we need to consume and produce quality goods that can be fixed or kept for many years. The economy won't show record growth but it will be balanced without showing record declines either. We also need to ease away from credit spending and move to a cash society. Back to scrimping and saving to make big ticket purchases. The effects won't be felt domestically too much from moving back to cash. Manufacturing is done externally and the banks and credit markets are already at historic lows. Overtime, using these strategies toward household spending will bring our economy back and pride in buying quality goods made by skilled labor-not sweatshops.
The green elephant attacks again
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