Friday, November 9, 2012

How to Row a Boat 101

Now that the GOP are realizing that they have been living in an alternate universe, perhaps they should revisit the premises that have guided their delusional voyage towards irrelevancy and obscurity:
  •  lower rates do not necessarily mean higher revenues (at least not adjusting from these historical low levels..yes, there are limits to the elasticity of the Laffer curve)
  • tax cuts do not necessarily create jobs (perhaps in Asia where a significant amount of investment capital is headed as per the axiom of free markets).
  America--like the rest of the West--have serious structural problems that, if not attended to, will certainly lead to  the demise of the type of society that has enhanced the standard of living of the entire civilization. Ironically, the tenets of free markets have been convoluted  and manipulated to reflect what Adam Smith warned about in The Wealth of Nations. (Smith would mockingly point at Wall Street and say 'I told you so...')

Insurmountable levels of debt--as a result of fiat money--and wealth polarization (a sure sign of an ever strengthening plutocracy) are the most pressing of the macro economic challenges and need to be dealt with immediately. (in case anyone thinks that the polarization of wealth is a healthy thing for society they should look into taking a remedial course in economic history.). Wagering on the longevity of a nation suffering from these two conditions is not considered prudent.
 The challenge will have to be met in an environment where education and vocational retraining will be essential in order to keep America competitive.... a nation with a crumbling infrastructure...a nation with a gargantuan demographic about to saturate the ranks of the retired. This may seem impossible to overcome but Americans--like so many other Western nations--don't have a choice. The time for sophism, extremist ideology, and adhering to policies that are marred with contradictory empirical evidence are about to end--if not by choice, certainly by necessity.
Everyone likes to blame someone else for the problems--which only serves to exasperate the economic and social polarization. We live in a culture where accountability, trust and most other virtues are considered impediments to personal growth--virtues that deter from being able to compete in an ever shrinking quickly changing world. Blame is a waste of energy and time: it is time to find solutions before a less-than-pretty natural solution is rendered upon us.
 How does one find the solution?
  • Identify the problem!!!
  • How to ascertain the problem?
  • Follow the Money!!! 
  • Have the balls not to sell out once you have found the root of the problem.
  • Formulate a solution in a fair and just manner.

You can only get to an intended destination in a rowboat if both oars are working complimentary to one another--not necessarily in unison--but at the very least in a congruent manner. America has to realize this soon if they expect to continue to live in a nation that embraces liberty. Both wealth polarization and excessive indebtedness lead to forms of slavery. I would hope that both sides of the America political juggernaut can at least initially agree that slavery is not a good thing...but maybe even that is asking too much!!!!!

Sunday, March 11, 2012

The Paradox of the Digital Age.

Societies and cultures are in the midst of massive change due to the incredible innovation in the digitization of information. The evidence continues to mount that the Industrial Age is being superseded by the maturing of the Information Revolution. The economic engine of the Industrial Revolution was the capitalist free market system which facilitated the efficient exploitation of natural resources and triggered innovation in mass production resulting in the optimization of the division of labour. While allowing individuals to pursue their self interest in a liberal market environment is not without its darkside, the free market paradigm is largely responsible for the standard of living we in the Western World have enjoyed.

As the Industrial Age fades into history the nascent Information Age continues to use the free market economic architecture. This presents a significant social problem that will have to be dealt with sooner than later. The free market system exploits resources in order to generate profits. This is not necessarily a bad thing if the term 'exploit' is taken purely in economic context--meaning to make the productive use of an asset. But exploitation can also be defined as making use of something in  an unfair and malicious way for one's own advantage. There is a fine line between the two and when  the exploitation of an asset changes its nature there is inevitably  a moral line that has to be crossed. Recent misfeasance on Wall Street testifies to this ongoing dilemma that our society faces.

The problem that arises in the Information Age is that information--digitized data--becomes  the new resource to be exploited for profit. The engines of capitalism no longer solely focus on the exploitation of natural resources or the division of labour, but now values pure information as a marketable economic asset.  Much of our  personal information is now digitized and classified as an economic asset by innovators of technology and by the stewards of the digital highway. Our privacy--the very basis of our liberty--is now subject to exploitation for profit as minerals, oil deposits and labour were in the Industrial Age. This exploitation can be productive in nature or it can be malevolent in nature.

The basic tenet of John Stuart Mill's seminal tome "On Liberty" was the 'Harm Principle'--essentially meaning  to DO NO HARM. Although Mill's work was published during the Industrial Revolution  his  moral and political philosophy has never been more important for our digital culture to embrace. If we allow ourselves to have our privacy exploited in a productive and just manner societies and individuals could reap great rewards. But conversely, if our personal information is exploited in a malevolent manner our liberty will soon be lost. The consequences of the latter will set the stage for  tyranny and a return to serfdom. Who would have ever thought that the advent of the computer could possibly usher in a new Dark Ages. The paradox of the digital age.