Blog: NOT CRISIS. COMPLEXITY.
How we define the problem determines the solution.
Michael Byrnes & Tamara van Halm — www.outoftheboxinsight.com
CONTRADICTORY DEFINITIONS OF THE PROBLEM
Since the Great Recession of 2008–09, an almost daily catalogue of crises seem to be reverberating throughout world economic markets and even social order itself. Some define the causal factor of these crises as a mere technical matter of wrong or inadequate policy. Others define the crises more in emotive terms such as immigration, degradation of social values, nationalism, or even miraculous technological antidotes. With each of these differing and sometimes contradictory definitions, equally differing and sometimes contradictory sets of solutions are tendered. As a consequence of these inconsonant definitions of problems and solutions, humanity remains self-constrained within a never-ending cycle of confusion, anger, and conflict. But what if all the myriad crises and solutions we so assiduously tender and debate are not actually problems? What if they are merely symptoms of a much deeper and existential challenge? What if by attempting to institute differing and sometimes contradictory solutions to these symptoms, we are actually making matters worse?
In our recent book, Wealth Beyond Nations, we explore interdependent evolutions of economics, philosophy, and social psychology to provide a transdisciplinary and more definitive diagnosis of the deeper and existential challenges that now face humanity. In a phrase, this new definition can be synthesized to the evolution of complexity. For the first time in human history, the masses are having to directly confront their individualistic and social perceptions and experiences of complexity. Yet, our very institutions, even our knowledge bases, have long been explicitly constructed to simplify and mechanistically guide our human endeavors. In short, we now stand at a crossroads. Maintain our allegiance to simplicity. Or, finally, and wisely, confront complexity.
PART ONE: A MORE DEFINITIVE DIAGNOSIS
Part One of Wealth Beyond Nations deconstructs complexity into three reverberant evolutions.
Artificial Intelligence & its Relationship to Mass Human Labor
We begin with three socioeconomic observations regarding computer automation in general and artificial intelligence [AI] in specific. The first observation reinforces popular and data-driven effects of automation/AI on labor demand. Specifically, that automation/AI will for the foreseeable future impose an exponential impact on reducing labor demand across almost every sector imaginable. Significant advancements in AI-directed medical diagnosis — once thought to be an exclusive domain of specialist humans, and simply unfeasible by AI — is highlighted as an example of the increasing threat to labor demand. The second observation relates to the particular form of cognitive reasoning that AI utilizes in resolving modern and complex problems. AI uses what is referred to as inductive reasoning, incorporating multiple and diverse sources of data so as to visualize a ‘pattern’. Almost the whole of human civilization, however, only has experience and education in using deductive reasoning, which uses limited sources of data so as to achieve a specific task. These are two completely opposing world views. As AI exponentially evolves to confront and solve modern 21st century problems more effectively than humans, this will have three profound impacts upon human societies. Deductive-centric human labor will be increasingly challenged in its ability to compete with AI’s inductive reasoning capacity. Human society will grow increasingly distrusting of AI technology with which it must compete, and does not even understand. And the pattern-seeking solutions identified by AI will likely require socioeconomic collaboration implemented on a global scale (which contradicts our longstanding adherence to cross-border socioeconomic competition). The third observation relates to how AI starkly reveals the deep complexities and interconnectedness of living systems. For human civilizations that cling to mechanistic, simplistic, and controllable objectives, the profound evolutions of production and cognitive methods brought about by AI will severely challenge the essential fabric of social order. That challenge has already begun.
Currency Creation & its Relationship to Real Estate and Debt
One of the most misunderstood and significant aspects of economics relates to how currencies technically operate. This misunderstanding not only relates to the general public, but also to political and business leaders and academia. When asked to describe how currency is technically created, almost the entirety of those questioned will respond that governments are the sole creators of currency. But the reality is that governments create only about 3 percent of all currency. 97 percent of all currency, since the ending of the gold standard in the 1970s, is created by local commercial banks when a real estate loan is created. This is referred to as ‘fiat’ currency. This real estate centric fiat currency system has had two significant impacts upon the day-to-day operations of market economies as well as upon social order itself. The first impact relates to how currency, since the late 1970s, has been unintentionally segregated from the cumulative economic value in circulation throughout the general marketplace. When currency was originally tied to the stored value of wealth of a nation’s treasury, this meant that currency was an independent ‘thermometer’ of a nation’s health. The more currency in circulation meant that more economic value was being generated. But when currency is tied to a particular commodity already operating in the marketplace, such as real estate value, the efficacy of the independent market ‘thermometer’ is made irrelevant. This role of money/currency operating as an independent ‘thermometer’ of market value was the central thesis of Friedrich Hayek throughout the early and mid 20th century. And if the evolutions emanating from the aforementioned automation/AI modes of production are factored in — where human labor demand is being increasingly replaced by AI — then real estate inevitably becomes abandoned from being a market utility to being nothing more than a specialized investment vehicle for the select few. The second impact relates to how modern real estate fiat currency exacerbates our addiction to debt. Since modern currency is based almost exclusively upon debt, humanity has neither any other mechanism by which to generate new avenues of wealth, nor any other ‘secular’ process to restrain human behavior. As a consequence of these privations, we heedlessly consume and pollute to extremes. Inexorably, we become evermore dependent upon government authority to restrain human behavior.
Not only does it become apparent that modern problems require more inductive, rather than deductive cognitive skills, the actual reward incentives for problem-solving should be naturally evolving from extrinsic to intrinsic motivations… but they are not. Once we begin to confront the complexity of any circumstance, we become uncomfortably conscious that much of society is unduly specialized and thus has difficulty in conceptualizing patterns across multiple disciplines. This functional fixedness, along with our long-held adherence to hierarchical organizational systems, blinds society from seeing and experiencing more free-flowing collaborative network relationships that cross borders of any kind. In fundamental economic terms, society and its orthodox institutions have long-adhered to placing quantitative value upon tangible goods. Yet, since the 1950s, qualitative value generation from intangible goods is naturally emerging without any orthodox institution adequately prepared to facilitate this qualitative value. Even our very language of rhetoric may now be doing humanity a disservice. In the past, the essential purpose of language was to persuade and control. This force of language may indeed have been useful when the choices before humanity were mechanistic and binary. If complexity is to continue to naturally evolve, however, our very language will also need to evolve so as to better facilitate diverse and interdependent choices. In short, the modern day-to-day and long-term challenges and opportunities that now face humanity are no longer facilitated by orthodox institutions and knowledge bases that dominate civilizations across the world. Life is evolving around us. But we are not.
If the above discernment of complexity is indeed the definitive diagnosis of the actual problems that humanity now faces, where do we go from here? Wealth Beyond Nations evaluates the two prevailing directions to which societies are now gravitating: maintaining the status quo and backward evolution. Continue to tender simplistic and mechanistic policy directives for otherwise complex and interdependent symptoms, which only makes the actual challenge of complexity more intractable. Or turn away from complexity all together and contract back to our respective tribal roots, which only gives succor to our more base instincts of fear and intolerance. Or, perhaps a third and much more formidable option: we can evolve forward.
PART TWO: A POTENTIAL FUTURE
Part Two of Wealth Beyond Nations, then, proffers a blueprint of the future where all of humanity deliberately embraces the complexity of life. But to implement this type of vision, we will have to delve deeper into the evolutions of economics, philosophy, and cognitive sciences.
We begin with a thought experiment. Within the next 20 years, artificial intelligence has matured to the point of being fully capable to provide all of humanity with the basic essentials of survival: food, clothing, and shelter. This thought experiment is not necessarily a mere abstraction. Recent advancements in AI make this level of maturation technically feasible. Within this ‘futurescape’, what will be the purpose and organization of human relationships? If AI provides all of humanity with the basics of survival, why do humans need humans? The purpose of this thought experiment is to demonstrate that our collective social narratives and institutions are presently constructed upon the Social Darwinism foundations of Herbert Spencer’s brutal ‘survival of the fittest’ principle. But if brute survival is no longer the essential challenge of civilization, then what becomes of our collective social narratives and institutions? As we journey through this thought experiment, we begin to expose new avenues of thought… new opportunities for human interaction. New concepts of humanity itself. Exploring emergent processes of technology transfer, collaboration networks, game theory, and alternative dialogue principles, Wealth Beyond Nations begins to sketch-out both how and why more interdependent human relationships might develop in the future.
Simplistic and mechanistic world views merely camouflage the deeper reality of complexity and interdependence. If we possess the courage to confront reality, we may come to behold our evolving selves. Our species nova.
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