European Tribune - Community, Politics & Progress.

A Rorschach Test

by Migeru
Sun Jul 20th, 2008 at 09:19:36 AM EST

I'm reading JK Galbraith's The New Industrial State, whose 3rd Chapter ends on the following note:

The modern large Western corporation and the modern apparatus of socialist planning are variant accommodations to the same need. It is open to every free-born man to dislike this accommodation. But he must direct his attack to the cause. He must not ask that jet aircraft, nuclear power plants or even the modern automobile in its modern volume be produced by firms that are subject to unfixed prices and unmanaged demand. He must ask, as just noted, that they not be produced.

While I finish the book and digest it and other recent readings such as Veblen's The Theory of Business Enterprise, I thought I would throw the quotation out there and ask for your reaction/interpretation of it. I see a large number of handles to go into favourite themes of ET.

Brought across by afew

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A Rorschach Test | 67 comments (67 topical, 0 editorial, 0 hidden)

Re: A Rorschach Test (4.00 / 3)

Yes, I am feeling kinda lazy this week.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Wed Jul 16th, 2008 at 08:53:33 AM EST

Elements of our chat in the downs. (4.00 / 4)

This doesn't address your short diary, but something I mentioned during our trek through the Sussex downs. The book I couldn't recall, but which is largely responsible for launching the whole flexible specialization 'paradigm' is The Second Industrial Divide: Possibilities For Prosperity by authors Michael Piore and Charles Sabel. I think it is still a valid, although it does not deliver on its more lofty promises, as this one of many critiques makes clear.

I had also mentioned the case of Ricardo Semler:

Ricardo Semler (born 1959 in São Paulo) is the CEO and majority owner of Semco SA, a Brazilian company best known for its radical form of industrial democracy and corporate re-engineering. Under his ownership, revenue has grown from $4 million US in 1982 to $212 million in 2003 and his innovative business management policies have attracted widespread interest around the world. [...] Semler went to work for his father's company, originally called Semler & Company, then a shipbuilding supplier in São Paulo. Semler clashed with his father, Antonio Semler, who supported a traditional autocratic style of management while the younger Semler favoured a decentralised, participatory style. [...] After dramatic restrictions on liquidity instituted by Brazilian president Fernando Collor de Mello to combat hyperinflation in 1990, Brazil's economy went into a severe downturn, forcing many companies to declare bankruptcy. Workers at SEMCO agreed to wage cuts, providing their share of profits was increased to 39%, management salaries were cut by 40% and employees were given the right to approve every item of expenditure.
Performing multiple roles during the crisis gave workers greater knowledge of the operations and more suggestions on how to improve the business. Reforms implemented during that time led to 65% reduction in inventories, a marked reduction in product delivery times and a product defects rate that fell to less than 1%.

"Beware of the man who does not talk, and the dog that does not bark." Cheyenne

by maracatu on Wed Jul 16th, 2008 at 08:33:04 PM EST
[ Parent ]

Re: Elements of our chat in the downs. (4.00 / 2)

maracatu: I had also mentioned the case of Ricardo Semler

I have been long been intrigued by Ricardo Semler and Semco's approach to democracy in the workplace.

I am curious if anyone has any info as to whether the reality lives up to the hype.

... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)

by marco (cowannar at gmail punkt com) on Wed Jul 16th, 2008 at 11:24:55 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

I can't follow the argument in that quote. Could you be persuaded to give a five-minute tour?

- Jake

"Terraforming your own planet to make it uninhabitable hardly counts as epic win." - ThatBritGuy

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jul 16th, 2008 at 10:06:27 AM EST

Re: A Rorschach Test (4.00 / 6)

Um, the argument is the whole of Chapter 3...

The modern large Western corporation and the modern apparatus of socialist planning are variant accommodations to the same need.

The need is to protect the complex organization necessary to function in modern industrial production from the vagaries of the market where price and demand fluctuations (even whether there is demand for the product in the first place) can be ruinous given the capital investments and the lead times involved in bringing a (new) product to the market.

Apart from standarisation, industrial business engages in vertical integration, long-term contracts, and monopoly/monopsony in order to eliminate market risk. In the 40 years since Galbrath wrote his book, hedging risk using financial instruments has become a fourth strategy.

It is open to every free-born man to dislike this accommodation.

Liberals of all stripes (social liberals or marketistas) will dislike the power of the large business and its control of the market and especially its control of demand which seeks to manipulate the consumer.

But he must direct his attack to the cause.

But the large planning unit and its control over prices and demand is not a cause but an effect. The cause is industrial civilisation and the constraints that places on the production units within it.

He must not ask that jet aircraft, nuclear power plants or even the modern automobile in its modern volume be produced by firms that are subject to unfixed prices and unmanaged demand.

Specifically, one cannot expect the kind of petty merchant or manufacturer that existed at the time of Adam Smith to produce a modern car, build and operate a nuclear power plant, or build a passenger aircraft.

He must ask, as just noted, that they not be produced.

If one wants to bring about an old-fashioned liberal economic utopia, it will not be industrialised.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Wed Jul 16th, 2008 at 10:21:12 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

Why haven't all those thinkers made it to econ 101?

It's starting to feel like the university is a nice complement to self-schooling.

If I understand correctly, he argues that market power is necessary to protect the organization that produces complex goods. But that does not reduce the overall level of uncertainty, only transfers it to someone else?

Or, requires that individuals behave according to the logic of that organization, not to their own?

Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine

by UnEstranAvecVueSurMer (holopherne ahem gmail) on Wed Jul 16th, 2008 at 11:20:02 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 4)

My take is Galbraith is noting a standard observation of Complexity Theory:

Any complex system exists in, and only due to, a meta-system that, to a greater or lesser degree, guides, confines, and controls it.

No one could have predicted

by ATinNM on Wed Jul 16th, 2008 at 02:17:03 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 4)

It's starting to feel like the university is a nice complement to self-schooling.

That is especially true for those of us who end up working in areas other than those for which we trained. And the percentage of such individuals increases with age.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer at eurotrib.com) on Thu Jul 17th, 2008 at 01:51:57 AM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

I'm 22, don't you think that's a bit too early ?

Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine

by UnEstranAvecVueSurMer (holopherne ahem gmail) on Thu Jul 17th, 2008 at 05:24:21 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 3)

The good thing about university is that studying for your degree leaves you time for self-schooling.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 05:27:30 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 4)

And the good thing about being a mature student is you already know more than your lecturers (apart from some very specialised knowledge) I think I learned more in the bar and the library than in lectures.

If you're not part of the solution, you're part of the precipitate.

by ceebs (ceebs (at) eurotrib (dot) com) on Thu Jul 17th, 2008 at 05:46:36 AM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Hopefully. But my own first job after obtaining an M.A. in History was as the assistant donut baker at the Eagle Bakery in Tucson. There were extenuating circumstances such as uncertainty about the draft, a small local market and lack of money to finance a move to a larger market. The up side was that I learned about craft breads, as all bakers got to take home their choice of a loaf of bread each night. Some nights, if the twist khalas were out of the oven long enough and early enough we would take one, buy a quarter pound of butter and take it to the Green Dolphin, where it quickly would be pulled apart, slathered with butter and consumed, washed down with pitchers of 3.2 beer.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer at eurotrib.com) on Thu Jul 17th, 2008 at 11:10:53 AM EST
[ Parent ]

Economics 101 (4.00 / 4)

Because if they were included students might get the idea that the exercise of economic power is an important subject of study for economics. Instead you get a "nice" collection of toy models where economic power is defined away axiomatically.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 05:16:54 AM EST
[ Parent ]

Re: Economics 101 (none / 1)

The politics of equity vs efficiency are much easier to handle for any professor than the politics of power.

By «defined away axiomatically», are you referring to the models that assume no market power and similar cost structures?

Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine

by UnEstranAvecVueSurMer (holopherne ahem gmail) on Thu Jul 17th, 2008 at 05:23:31 AM EST
[ Parent ]

Re: Economics 101 (none / 0)

I should quote Galbraith more extensively, he's very entertining on this particular point. I dont think much has changed since the 60's - if anything there's been a backlash.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 05:30:31 AM EST
[ Parent ]

Yes, the 1960's was much better ... (none / 1)

... not for the position of the majority of the profession, but rather for their much weaker ability to deny legitimacy to dissent.

Utsukushikereba sore de ii

by BruceMcF (agila61 at netscape dot net) on Sun Jul 20th, 2008 at 01:10:47 PM EST
[ Parent ]

Re: Economics 101 (4.00 / 2)

Especially for economists, for whom venturing into such waters can be career suicide. Anthropology departments will offer courses such as "The Anthropology of Wealth and Power." There are a number of quite readable texts targeted at such an audience.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer at eurotrib.com) on Thu Jul 17th, 2008 at 11:16:08 AM EST
[ Parent ]

Lack of textbooks is a difficulty ... (none / 1)

... for teaching about the majority of the economy that does not lie within the narrow confines of the grammar and syntax of the traditional marginalist language of economics.

Utsukushikereba sore de ii

by BruceMcF (agila61 at netscape dot net) on Sun Jul 20th, 2008 at 01:12:37 PM EST
[ Parent ]

Rather ask how all those thinkers ... (none / 1)

... were herded out of Econ 101 ... indeed, herded out of almost all the upper division undergraduate courses as well.

Utsukushikereba sore de ii

by BruceMcF (agila61 at netscape dot net) on Sun Jul 20th, 2008 at 01:07:35 PM EST
[ Parent ]

Re: Rather ask how all those thinkers ... (none / 1)

That is sometimes referred to as "market discipline." J.A. Hobson published a very cogent critique almost exactly a century ago: Imperialism, a Study. Full text is available on line, if the site is not radioactive for your employer. My preferred set of excerpts is found in D.C. Heath's Problems in European Civilization series: The "New Imperialism" H. M. Wright, ed. 1961. He clearly describes how academia is brought to heel. It has only gotten worse since then.

It is also discussed in A Survey of Global Political Economy 2007 by Kees van der Pijl, also available online in full text. It might be a less radio-active site, and has the advantage of being more recent.

I found Hobson to be very clear. In the summer of 1965 I was the graduate reader for a senior level course in 20th Century Britain and The "New Imperialism" was one of the assigned texts. The professor asked who in the class understood and could explain Hobson's thesis. Mine was the only hand to go up. I always waited to see if someone else could answer before raising my own hand, to be fair. But it was summer school, a lot of the class was just there to get what they hoped would be three easy credits and were business, or other liberal arts majors, not history majors.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer at eurotrib.com) on Sun Jul 20th, 2008 at 02:56:04 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Um, the argument is the whole of Chapter 3...

Oh.

Maybe I shouldn't feel bad about the fact that I couldn't follow it from a five-line quote of the conclusions, then :-P

Thanks for the summary.

- Jake

"Terraforming your own planet to make it uninhabitable hardly counts as epic win." - ThatBritGuy

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jul 16th, 2008 at 11:25:26 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

The success of the neo-con or anglo disease agenda is in large part due to the fact that they have reduced economic complexities to simplistic market based truisms that appeal to the small businessman, self -employed, and social conservatives who know nothing of business but which have in reality got nothing to do with how big business and big Government has to operate. The trick is to expect Government to behave as if it could be guided by the values and mindsets of a small business whilst big business rapidly globalises and removes itself from all effective democratic control.

"It's a mystery to me - the game commences, For the usual fee - plus expenses, Confidential information - it's in my diary..."

by Frank Schnittger (mail Frankschnittger at hot dotty communists) on Wed Jul 16th, 2008 at 11:34:41 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 3)

The trick is to expect Government to behave as if it could be guided by the values and mindsets of a small business...

Rather, that is the trick that campaign managers and RW politicos use to get themselves elected. It appeals directly to the personal experiences and prejudices of small businessmen and those who identify with them. They see no contradiction arising from the totally different behavior of large corporations, which routinely flout all of the cautionary strictures of Adam Smith, as they see large corporations as simply being more successful versions of small businesses, and thus aspirational for them and worthy of defense, even when that puts small businesses out of business.

People such as Karl Rove certainly see this and don't give a damn about the contradictions. Probably most of the adherents to that point of view are less clear on these issues. They just "know" that it is important for "their guys" to win so that the country will be run according to "correct" values. For them it is a problem of preserving their identity regardless of the consequences, those consequences that are now besetting us all.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer at eurotrib.com) on Wed Jul 16th, 2008 at 01:28:50 PM EST
[ Parent ]

Re: A Rorschach Test (none / 0)

Agreed

"It's a mystery to me - the game commences, For the usual fee - plus expenses, Confidential information - it's in my diary..."

by Frank Schnittger (mail Frankschnittger at hot dotty communists) on Wed Jul 16th, 2008 at 03:23:40 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 3)

JKG:

If one wants to bring about an old-fashioned liberal economic utopia, it will not be industrialised.

Nice outline, but wrong conclusion. Cathedrals, pyramids and other giant projects show that industrial-scale outcomes are possible with other social models.

The fallacy is to assume that it's top-down centralised micromanaged planning, or nothing - in other words that we've exhausted every possible cultural approach to managing big resource extraction and processing projects.

I don't think this is true. In fact the problem now is to invent new kinds of social organisation which mix the sustainability of subsistence cultures with the dynamism and inventiveness of explorer cultures.

I'm not saying it's easy, but I'm also not convinced it's impossible.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Wed Jul 16th, 2008 at 12:02:00 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 3)

If one wants to bring about an old-fashioned liberal economic utopia, it will not be industrialised.

No, it's the right conclusion, because, you have to remember that when he was writing "liberal" meant "Manchester liberal" and thus the quote could be rewritten from modern understanding as:

If one wants to bring about that cliche of a glibertarian economic utopia, it will not be industrialised.

by Metatone (metatone [a|t] gmail (dot) com) on Wed Jul 16th, 2008 at 02:08:08 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Er - haven't we had the industrialised cliche glibertarian utopia for the last couple of decades?

We still have some taxes and a few social services, but it hasn't exactly been happy time for neo-Keynesians.

It's true that glibertarian utopias have a habit of imploding, but I'm not sure he's suggesting that.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Wed Jul 16th, 2008 at 02:53:11 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

ThatBritGuy:

Er - haven't we had the industrialised cliche glibertarian utopia for the last couple of decades?

Only in Somalia...

ThatBritGuy:

It's true that glibertarian utopias have a habit of imploding, but I'm not sure he's suggesting that.

I know it seems odd now, but back when he was writing, "liberal" really did mean something different, much closer to glibertarian than it does now.

by Metatone (metatone [a|t] gmail (dot) com) on Wed Jul 16th, 2008 at 07:57:46 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Has Somalia industrialised while no one was looking?

Metatone:

I know it seems odd now, but back when he was writing, "liberal" really did mean something different, much closer to glibertarian than it does now.

After Reagonomics?

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Jul 17th, 2008 at 07:17:03 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

wasnt it Clinton who bombed the Somalis last attempt at industialisation?

If you're not part of the solution, you're part of the precipitate.

by ceebs (ceebs (at) eurotrib (dot) com) on Thu Jul 17th, 2008 at 07:21:37 AM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

No, the book is originally written in the 60's - it's only the new introduction that is after Reaganomics. And that may have been written by his son James Galbraith.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 07:38:40 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

JKG wrote his book in 1964, with a last revision in 1978. However, the book has an introduction written after the introduction of Reaganomics, and it is clear that the glibartarian nonsense he attributed to "a few romantics" has been the stuff of policy for the past nearly 25 years - with known results.

It's amazing, really, because in the 1960's Galbraith was ready to pronounce neoclassical marginalist economics dead.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 05:10:23 AM EST
[ Parent ]

Re: A Rorschach Test (none / 0)

Precisely.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 05:07:45 AM EST
[ Parent ]

new kinds of social organisation (4.00 / 3)

ThatBritGuy:

The fallacy is to assume that it's top-down centralised micromanaged planning, or nothing - in other words that we've exhausted every possible cultural approach to managing big resource extraction and processing projects.
I don't think this is true. In fact the problem now is to invent new kinds of social organisation which mix the sustainability of subsistence cultures with the dynamism and inventiveness of explorer cultures.
I'm not saying it's easy, but I'm also not convinced it's impossible.

I would be very interested in reading about any possible models you might have in mind.

... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)

by marco (cowannar at gmail punkt com) on Wed Jul 16th, 2008 at 11:51:13 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Nice outline, but wrong conclusion. Cathedrals, pyramids and other giant projects show that industrial-scale outcomes are possible with other social models.
The fallacy is to assume that it's top-down centralised micromanaged planning, or nothing - in other words that we've exhausted every possible cultural approach to managing big resource extraction and processing projects.

Micromanaged they may not have been, but the Pyramids were not built by the invisible hand of the market guiding large numbers of independent small productive units. And if the Cathedrals were built "by committee" so to speak it is more because of the dismal surplus capture rate that the system had in medieval Europe, so projects outlived their originators.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 05:13:08 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

Cathedrals were built by committee because they were the projects of cities rather than individuals, too... And at the time cities were relatively independent.

Un roi sans divertissement est un homme plein de misères

by linca (antonin POINT lucas AROBASE gmail.com) on Thu Jul 17th, 2008 at 07:08:23 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 3)

I'm not convinced that anything has ever been built by the invisible hand of the market guiding large numbers of small productive units. 'The market' is a stand-in for real or wannabe aristocracy, and always has been.

That doesn't mean large structures can't evolve without markets or centralised planning. Historic non-Western cities prove that point - cities may be supported by trade, but they're not necessarily defined by it.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Jul 17th, 2008 at 07:28:09 AM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Well, that's the point, isn't it? We have our political leadership running around gutting the industrial base by trying to force it to function as a collection of small competing units. The only ones who benefit, temporarily, are the financiers. After a while, the economy crashes and they lose out too, except that tere is no industrial base left. <shudder>

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 07:41:05 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 3)

Small competing units are fine for small competing products. When there's a low cost of entry, very interesting things can happen - but they won't be big interesting things.

I think the push away from industrialisation is more complicated. It's a mixture of opportunism, social snobbery, class war and a desire to emasculate unions, and an understanding that capital is much better at making more capital when it doesn't have to deal with real things in the real world.

But there's a more basic metaphor. The only real currencies in economics are physical commodities and trust.

If you build a hyper-competitive system where no one can trust anyone else, sooner or later - completely unexpectedly - trust evaporates, and the system implodes in a spectacular display of fiscal paranoia.

If you're running out of physical commodities at the same time - that's also not a good thing.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Jul 17th, 2008 at 08:20:16 AM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

This phrase strikes me as key ...

The fallacy is to assume that it's top-down centralised micromanaged planning, or nothing - in other words that we've exhausted every possible cultural approach to managing big resource extraction and processing projects.

Just so, what I'd like to see is a more distributive model for energy generation (which makes sense if you need multiple 'small' green generators --solar/wind--as opposed to one big ole nuclear reactor or coal burning / oil burning power plant). In fact, moving to a more conceptual plane, the distributive model is part and parcel of what drives the open source movement. A great essay that delineates some of this is the Cathedral & the Bazaar, documenting, among other things the 'subversive' Linux author's working method.
The lead graph is a pretty compelling argument for a completely different approach to 'centralized' software development.

Linus Torvalds's style of development--release early and often, delegate everything you can, be open to the point of promiscuity--came as a surprise. No quiet, reverent cathedral-building here--rather, the Linux community seemed to resemble a great babbling bazaar of differing agendas and approaches (aptly symbolized by the Linux archive sites, who'd take submissions from anyone) out of which a coherent and stable system could seemingly emerge only by a succession of miracles.

And yet, it obviously has worked. "The power of many", is the short hand I'll use to describe this 'miracle'. Much is fleshed out in the essay, but I wonder if such a de-centralized approach can't also work within the context of the 'meat' world to use Gibson's phrasing... energy production, for example, with solar panels on residential rooftops flowing back into a distributing grid, or agri-business with local farms providing much of the seasonal food stuff for a given community...? Even in terms of so called 'big ticket' items, I think there are way to get around the centralized industry mindset: How about cars as an example?

I wanted to find a low priced green e-vehicle that would get me from a-b with a decent speed and decent range and wouldn't cost me a fortune.

Zap car came immediately to mind, but after doing some research and test driving I wasn't happy: 11,000 MSRP for a car that advertises 45 mph, but barely runs 35 with the wind at it's back, and on steep uphill grades was even slower. Worse the range couldn't even let my wife do a roundtrip to our daughter's highschool and back (about 60 miles). It was a deal breaker. So I started hunting around. What I found was a veritable ecosystem of garage mechanics building their own e-vehicles by gutting light weight Hondas or VW bugs and filling them with standard batteries. For about $8000 I could find a ride that was notably cheaper, faster and further than the Zap vehicle. Or I could build my own. Once the basic engineering principles are mastered and the parts obtained (and most good junk yards and auto supply stores would have what you need) an e-vehicle can be converted or built from scratch for easily $10,000. One that is cheaper than Zap, goes further and is faster. So why does the centralized manufacturer suffer by comparison to the home hobbyist?

A couple of explanations are possible. A big one: the main cost of the vehicles is offset initially by effectively reusing a chassis. Labor and other overhead is absorbed by the person working on his own conversion or doing a kit. A lot of the same thing goes on in the bazaar model of software development. The labor turns out to be something of a labor of love; not many millions were initially made by the intellectual tinkerers who put together Linux; and yet, in terms of value, it's pretty staggering to think of the value of the Linux OS now. What corporations want to do is lock in that future value by centralizing the development of their 'product'--in point of fact the ONLY way they can think of safeguarding their 'product' is through a centralized process. That's ultimately why Linus's methodology was subversive. He didn't bother to safeguard anything. He left it wide open. I think we can make that same shift in terms of agri-business and energy production. Perhaps even big ticket items like home building (earth ships) or autos (re-vamped e-vehicles), but it will take the 'risk' of foregoing a guaranteed profit. And a lot of tinkering by cooperative communities, no doubt :-)

by delicatemonster (delicatemons@delicatemonster.com) on Mon Jul 21st, 2008 at 11:49:39 PM EST
[ Parent ]

Guess (4.00 / 8)

What this is discussing...

Analyzing this further, Grinder and Bandler stated that there were a few common traits expert communicators - whether top therapists, top executives or top salespeople - all seemed to share:

Everything they did in their work, was pro-active (rather than reactive), directed moment to moment by well-formed outcomes rather than formalized fixed beliefs
They were exceedingly flexible in approach and refused to be tied down to using their skills in any one fixed way of thinking or working
They were extremely aware moment by moment, of the non-verbal feedback (unconscious communication and metaphor) they were getting, and responded to it - usually in kind rather than by analyzing it
They enjoyed the challenges of difficult ("resistant") clients, seeing them as a chance to learn rather than an intractable "problem"
They respected the client as someone doing the best they knew how (rather than judging them as "broken" or "working")
They had certain common skills and things they were aware of and noticed, that were intuitively "wired in"
They worked with precision, purpose, and skill
They kept trying different approaches until they learned enough about the structure holding a problem in place to change it.

And these principles and presuppositions:

Behind every behavior there is a positive intention. Even a seemingly negative thought or behavior has a positive function at some level or in some other context.
A person is not his or her behaviour
There is no failure, only feedback.
The meaning of the communication is the response it produces, not the intended communication.
One cannot not communicate: Every behaviour is a kind of communication. Because behaviour does not have a counterpart (there is no anti-behaviour), it is not possible not to communicate.
Choice is better than no choice. An idea from cybernetics that holds the most flexible element in a system will have the most influence or choice in that system.
People already have all the internal resources they need to succeed.
Multiple descriptions are better than one.
Meet people in their own unique map of the world This is based on the generalisation that one individual's reality is not the same as any other's and is linked to the principle that the map is not the territory.

But don't let me stop your reading... ;-)

You can't be me, I'm taken

by Sven Triloqvist on Wed Jul 16th, 2008 at 10:13:26 AM EST

Re: Guess (none / 1)

Wow - not a bad summation of leadership/communication skills, but what has this got to do with Keynes? My "map" doesn't have many connections between macro economic theory and individual leadership!

"It's a mystery to me - the game commences, For the usual fee - plus expenses, Confidential information - it's in my diary..."

by Frank Schnittger (mail Frankschnittger at hot dotty communists) on Wed Jul 16th, 2008 at 11:28:47 AM EST
[ Parent ]

Re: Guess (4.00 / 5)

I was continuing with the Rorschach theme ;-)

You see in it what you want to see in it.

But those quotes are lifted from the wikipedia entry on NLP - neurolinguistic programming. I was looking for some clues to how to 'change the frame' from different sources. The quotes stood out as I read them, because whatever one might think of NLP, they contained a lot of insight for me. And, as you say, the first batch are a pretty good description of the capabilities needed for leadership, communication and cooperation.

You can't be me, I'm taken

by Sven Triloqvist on Wed Jul 16th, 2008 at 05:28:02 PM EST
[ Parent ]

Re: Guess (none / 1)

Very good.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

by Migeru (migeru at eurotrib dot com) on Thu Jul 17th, 2008 at 05:14:13 AM EST
[ Parent ]

Re: Guess (4.00 / 3)

Bandler is a known crazy, and I don't think this is in any way an honest list.

Ironically it doesn't communicate what 'success' is. Is someone who's earning $100 million a year successful by definition? Mozart died in poverty. So did Van Gogh. Were they succesful or not? Did they have these skills?

And so on.

In fact, like the rest of NLP, it's rather a glib and superficial list of attributes - perfect for sunny-side-up management consultancy meetings where the aim is a bit of light challenge followed by ego fluffing and corporate cheerleading, but perhaps not quite the deep insight it appears to be.

In the real world the defining characteristic of 'successful' executives seems to be pig-headed stupidity and an asteroid-sized sense of entitlement. There's the odd exception who can demonstrate a track record of strategic foresight, but it's much easier to find execs barreling through their careers with an almost total lack of self-awareness, empathy for others, or connection to the real world, defining their 'success' in short-term gains and newspaper column inches, and 'communication' as absolute and total control over the corporate message.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Jul 17th, 2008 at 07:45:05 AM EST
[ Parent ]

Re: Guess (none / 1)

Not my experience in Finland ;-)

You can't be me, I'm taken

by Sven Triloqvist on Thu Jul 17th, 2008 at 09:55:00 AM EST
[ Parent ]

Re: Guess (none / 1)

I'm with TBG on this one.

Perhaps there's a reason the UK and US MBAs are notoriously bad managers?

No one could have predicted

by ATinNM on Thu Jul 17th, 2008 at 10:52:47 AM EST
[ Parent ]

Re: Guess (none / 1)

We have mostly diploma engineers, not MBAs

You can't be me, I'm taken

by Sven Triloqvist on Thu Jul 17th, 2008 at 11:15:34 AM EST
[ Parent ]

Re: Guess (none / 1)

In any case, those quotes applied to all leadership, communication and cooperation, not just in business.

You can't be me, I'm taken

by Sven Triloqvist on Thu Jul 17th, 2008 at 12:01:38 PM EST
[ Parent ]

Re: Guess (4.00 / 3)

They kept trying different approaches until they learned enough about the structure holding a problem in place to change it.

Ultimately it seems to get down to changing changing peoples' perceptions, including their self perceptions. We all want to feel good about ourselves. Bringing to consciousness contradictions between strongly held values and/or between values, identity and conduct and between conduct and outcomes can be a means of accomplishing that. I have seen one such technique described as "inflicting wounds on the narcissistic ego". Reality is currently performing that task massively.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer at eurotrib.com) on Wed Jul 16th, 2008 at 01:46:43 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

And if he does not ask that they not be produced, he should then ask himself if it be preferable that the means of production of those things be controlled by the wealthy, and profits arrogated to the wealthy, or if that control be either more equitably shared or, at the very least, the profits more equitably distributed.

Mais c'est un scandâââle!!

by redstar on Wed Jul 16th, 2008 at 12:12:46 PM EST

Re: A Rorschach Test (none / 1)

The USSR failed because it was non-democratic, not because it was centrally planned.

Capitalism (at least the utopian pure type) is non-democratic. The market is supposed to replace the ability to vote. Perhaps this might work in a perfect world, but what we have seen over the past 300 years is that the capitalists subvert the democratic political institutions thought their use of money to buy politicians.

So what we have in practice is industrial policy being made non-democratically, the same as in the USSR. It is just taking a bit longer for the US (and EU) to collapse, that's all.

Discuss...

Policies not Politics
---- Daily Landscape

by rdf (robert.feinman@gmail.com) on Wed Jul 16th, 2008 at 12:32:17 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

That's part of it, it very definitely could have been more democratic, which is where Gorbatchev was headed anyway.

But the ultimate reason it collapsed, when it did, was because it was forced in the 2nd cold war to spend far more on guns, to the detriment of butter, than it could afford, because let's face it, the economic might of the ussr was no match for that of the us (and this not being the fault of economic system - remember the development gap already was there at the time of the overthrow of the tsar, and then it's a fact that Russia was far more impacts, economic, demographically, by a certain war in the late '30's and early '40's).

This over emphasis on keeping up with the us in the arms race created all sorts of economic distortions and ultimately led to the conditions which resulted in the (not entirely inevitably imo) collapse. But then, the militarism was abandoned, and this is a good thing, and now, the us is the last country to be fully militarised.

The collapse will be because of that. Which is why the eu will not.

Mais c'est un scandâââle!!

by redstar on Wed Jul 16th, 2008 at 12:55:19 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

You might find this interesting. The author doesn't buy into the "militarism caused the USSR to implode" theme so much. He has a book about it.

http://www.energybulletin.net/node/23259

http://www.amazon.com/Reinventing-Collapse-Example-American-Prospects/dp/0865716064

Policies not Politics
---- Daily Landscape

by rdf (robert.feinman@gmail.com) on Wed Jul 16th, 2008 at 01:18:08 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

I love Orlov's stuff, quite entertaining, though if you look at slide 5, I'm not sure he doesn't by the fact that militarism did the SU in...

Mais c'est un scandâââle!!

by redstar on Wed Jul 16th, 2008 at 01:27:47 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 3)

Ok, this is officially a phenomenon in search of a name:

The routine act of linking to Dmitry Orlov's "Closing the Collapse Gap" slideshow on ET when the subject of the fall of the USSR arises.

[Dmitry Orlov's Collapse Gap Technology^TM]

"Pretending that you already know the answer when you don't is not actually very helpful." ~Migeru.

by poemless on Wed Jul 16th, 2008 at 01:48:24 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

a case of "Orlov's dog"?

(as in a reflexive response, that is)

The difference between theory and practise in practise ...

by DeAnander (de_at_daclarke_dot_org) on Thu Jul 17th, 2008 at 03:43:48 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Brilliant.

Nice to "see" you here!

"Pretending that you already know the answer when you don't is not actually very helpful." ~Migeru.

by poemless on Thu Jul 17th, 2008 at 04:00:27 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Well, the military-industrial complex most probably played a role. But I think that one thing that is frequently overlooked in popular discussions of the collapse of the Soviet system is the surveillance-industrial sector. You can't employ a full 10 % of your population to do nothing but watch over the other 90 % and make sure they don't do anything too dissenting. Even quite apart from the chilling effect it has on society in general, the sheer up-front cost of running such a system must have been a huge drain on the economy of those countries.

- Jake

"Terraforming your own planet to make it uninhabitable hardly counts as epic win." - ThatBritGuy

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jul 16th, 2008 at 01:48:17 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

I suggest you do a calculation to see what amount of the US economy is currently devoted to fear mongering and security theater.

For example, every office building in NYC now has one or more guards, a CCTV system and who knows what else to monitor those going in and out.

When I worked in Manhattan you walked into the building, looked up your party on the wall listing and took the elevator. Nothing untoward happened.

Then there are all the concrete bunkers placed in front of building to prevent enemy tanks (I guess) from crashing through the front door - how much do they cost?

How about the armed soldiers in the train stations and the cops doing random bag checks of law abiding citizens taking the subway. Who is paying their salaries? (Oh, I forgot, we are.)

Shall I go on: Homeland Security, 15 spy agencies (that we know of), Total Information Awareness, the "green zone" at how many billions.

Police states are inefficient as you indicate, but not just because of the useless labor being expended (exactly what do hedge fund managers contribute to productivity), but because a cowed populace is unproductive and lacks entrepreneurial spirit.

Frightened leaders make for a frightened populace and there are none more scared than those who have been demolishing the US constitution.

Policies not Politics
---- Daily Landscape

by rdf (robert.feinman@gmail.com) on Wed Jul 16th, 2008 at 03:11:30 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 2)

Police states are inefficient as you indicate, but not just because of the useless labor being expended (exactly what do hedge fund managers contribute to productivity), but because a cowed populace is unproductive and lacks entrepreneurial spirit.

Uh, China.

The USSR wasn't helped by a complete lack of competitive industries outside of its military hardware, leading to an over-reliance on commodity exports and their (then) tendency to fluctuate wildly in value.

Redstar recently claimed that the US also lacks competitive industries outside of the military, although he's at least half wrong (it along with the vampiric financial sector does create a massive talent drain from the point of view of productive industries).

you are the media you consume.

by MillMan (millguy at gmail) on Thu Jul 17th, 2008 at 04:21:42 AM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Not exactly. I claimed that the US lacked competitive industries outside of military applications (not jusst hardware) and intellectual property which is prone to pirating and therefore quite dependant upon the sorts of multilateral cooperation the US is very poor at.

Mais c'est un scandâââle!!

by redstar on Thu Jul 17th, 2008 at 10:23:58 AM EST
[ Parent ]

Re: A Rorschach Test (none / 0)

The USSR's policies prevented them from implementing 1960's / 1970's technology - needing three signatures to use a copy machine, for example. Most of the world, outside of the poorest nations, have navigated their way to acceptance of all technology on offer to the current day, but are currently teetering on the edge as the internet is a natural enemy of any organized government and our entrenched scarcity based industries. I say "teetering" because it is trivial to take down the internet or control it centrally but at the same time is integral to our economies in its current open form.

you are the media you consume.

by MillMan (millguy at gmail) on Thu Jul 17th, 2008 at 04:30:07 AM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 4)

The USSR collapsed for a plethora of reasons. Picking one and elevating it to a Platonic The Cause is, IMHO, forecloses deep analysis and the insight such offers.

One cause was: military adventures are ruinously expensive.

One cause was: They pretend to pay us and we pretend to work.

One cause was: Top/Down command structures mandating and enforcing rotten decisions.

and there were others.

Needless to say, these same causes are prevalent in the US, today.

No one could have predicted

by ATinNM on Wed Jul 16th, 2008 at 02:25:09 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 4)

H'mmm.

One cause of Inept Communication is the communicator's inability to use proper English Grammar.

No one could have predicted

by ATinNM on Wed Jul 16th, 2008 at 02:27:47 PM EST
[ Parent ]

Re: A Rorschach Test (4.00 / 3)

Aaah thowght as 'ow yer wuz doin' alreet ;-)

(One of the few sentences in the English language that allow one to give a different regional accent inflection to each word)

You can't be me, I'm taken

by Sven Triloqvist on Wed Jul 16th, 2008 at 05:33:44 PM EST
[ Parent ]

Re: A Rorschach Test (none / 1)

Quite an ink blot you threw up there, Mig. You oughta do that more often.

Somewhere in cyberspace, the ghost of de Chardin is smiling.

by budr on Sun Jul 20th, 2008 at 11:43:23 AM EST

A Rorschach Test | 67 comments (67 topical, 0 editorial, 0 hidden)

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