FREAK SHOW “We really do not know how this system works . . . The old models just are not working.” Prologue: Boy Has Somber Insight An air of furtive excitement, of immanent, wondrous and somehow illicit discovery seemed to pulse along the marquee, and my heartbeat quickened with it. Should I spend my meager funds on rides, or on a ticket to see the Dog-faced Boy? Or the World’s Strongest Man? Or the Half-Woman/Half-something else? I don’t remember what the other half of that last one was supposed to be, but the crude painting of the scantily-clad upper half of a woman tipped the scale. I parted with my money, entered the dusty, dimly lit tent, and joined a line of guys—mostly young—filing past a small enclosure. Within it reclined a woman—not young—wearing the top half of a swim suit and a costume from the hips down that was supposed to resemble half of a something-or-other. All the excitement I had felt curdled instantly into a complex jumble of unpleasant feelings and a tacit knowledge that went something like this: the carnies had dangled a laughably unbelievable fantasy, counting on impulses I did not understand but apparently shared with many others, and had conned us into paying money to find out what chumps we were. Furthermore, I understood something about commercial interactions that I had noticed repeatedly without giving much thought to: an object or event offered for sale or trade often hooks a fantasy that seldom gets fulfilled. It would be a long time before I could articulate this understanding, but it was born in that moment. Finally, I knew somehow that people who get duped like this tend to accept it as common practice. I saw it as the other suckers and I straggled out of the tent, facial expressions unreadable, and dispersed. Not one of us rushed back to the ticket line to demand our money back and warn others about the scam. Living in a Freak Show Strong words, I know, and tightly packed. Please stay tuned while I unpack them. The next few pages lay a foundation of knowledge about systems in general, so that the reader may understand precisely how the prevailing economic system violates principles governing all systems. System; Economic; Capitalism. Think of a set of elements that all connect together, each one affecting all the others. They all function together as a whole, and that whole accomplishes something—keeps a home at a comfortable temperature, generates and distributes electrical current to the parts of a car that need it, extracts energy and building material from food and excretes waste, those sorts of accomplishments. Holarchy Living and Non-Living Remember that systems, in the more-or-less technical sense used here, always accomplish something. Now, as far as we know, nothing in the universe gets done without some form of energy being involved. That means systems need energy to do what they do. Where does this energy come from? Here’s where we get to the difference. A living system proactively takes in sources of energy from other systems around it (the biosphere) in a chain tracing all the way back to the sun. It processes those sources of energy (you know, food), deriving a form of energy it can use to do its thing, then releases what it does not use back to the biosphere to be used as food for some other system. All along the way—input, throughput, and output—the living system functions autonomously, meaning it sustains itself. All its subsidiary and overarching systems do the same thing; “itself” does not mean “in isolation.” A non-living system, on the other hand, must have energy provided to it in order to function. It cannot proactively obtain energy for itself. It produces waste that seldom serves as fuel for other non-living systems, but instead increases disorder in its environment. I am trying to convey here that non-living systems do not sustain themselves. They are—or behave like—machines, and machines quickly cease functioning unless they are maintained from the outside. Let’s look more closely at how a living system sustains itself. That process turns out to have two distinct and vital facets: self-regulation and self-organization. The discussion about the freakish aspects of capitalism that comes later hinges on at least a rudimentary grasp of both of these facets. Self-Regulation If I were to diagram this information-response process, you would see that it occurs in loops: a change in one holon causes a change in another, and that change in turn causes more change in the original holon. Visualizing it like that might help clarify the discussion that follows. Systems thinkers make extensive use of loop diagrams in applying information-response dynamics to real world situations. The kind of feedback that enables living systems to self-regulate is called deviation-reducing, or simply negative, feedback. It helps the system reduce the deviation between the conditions favoring survival and the conditions actually prevailing within the environment. Keep this crucial aspect of living systems in mind when we get into discussing capitalism below. We will examine how capitalism (more specifically, corporate capitalism) tries to evade negative feedback. Self-Organization Returning to the example of body temperature relative to environmental conditions, let’s imagine a primitive human who has lived comfortably naked in a temperate climate. Imagine the climate suddenly becoming so much colder that the person’s body can no longer stay warm enough through internal processes. This person and his or her companions, who are all facing the same crisis, discover quickly that huddling together keeps them warmer. But they cannot remain huddled and still do what they need to do, such as obtain food. They have observed that other mammals are covered with fur and live in dens. They emulate this, and by doing so manage to survive. They have adapted by learning effective ways to change their behavior, leaving behind the old status quo and re-organizing around a new one. Deviation-reducing feedback will resume, but at a higher level (behavioral/cultural) that incorporates the previous level (physiological). Let’s look at another illustration of self-organization that might seem more relevant for some readers. Imagine a girl growing up in a family that conditions her to keep her eyes lowered and speak in a small voice. She learns to feel normal and accepted only by behaving meekly. When she grows up and leaves home, she marries into a family in which her meekness invites scorn and verbal abuse, and the more abuse she gets the meeker she acts, which only brings more abuse. One day she loses all self-control and bellows, “Stop it! You’re all driving me crazy! Just back off!” Astonished, her in-laws do back off. From then on she holds her head up ands speaks assertively, which gains the respect of her in-laws and eventually feels normal to her. How does this fable illustrate positive, or deviation-amplifying, feedback as a factor in self-organization? Remember how, when she got verbal abuse from her in-laws, the woman acted more and more the way she had been trained to by her original family, which stimulated more and more abuse, and so on in what we commonly call a “vicious cycle.” Well, systems thinkers call this a positive feedback loop. Schematically, it works like this: an activity in holon A elicits a response from holon B, which then elicits an increase in holon A’s activity, which increases holon B’s response . . . and so on. Do you see how this scheme would amplify deviations from an optimum state of being—in this case, the woman’s level of emotional comfort? The positive feedback loop was interrupted only when the woman blew her top and self-organized at a higher level. It’s a good thing she did or she really would have gone crazy—disintegrated psychologically. Because throughout the natural world, positive feedback loops must culminate either in a breakthrough to a higher level of system organization--and resumption of self-regulation at that new level—or in system disintegration. The feedback gets going when change in a system’s environment requires change in the system, and it can lead to evolutionary development. But if allowed to go on too long, such a loop can lead to the system’s destruction. We will have occasion to recall this in the next section. There you have the basic nature of systems, and the qualities (self-regulation and self-organization) that distinguish living from non-living systems, as simply as I can state them. With this background, we are ready to look in general at economic systems, and at corporate capitalism—the industrial growth economy—as a particular subset of those. Economic Systems; Capitalism Does it match the characteristics of a living system? Ideally, yes. Self-regulation occurs when the economy attends to ongoing information about the environment from which come the matter and energy that fuel it, and into which it moves its waste, and adjusts its throughput to keep that environment, and therefore the economy itself, viable. Self-organization happens in the event that the environment shifts beyond the economy’s current capability to adjust and, following some inevitable turbulence, the system re-organizes at a more complex level to accommodate the environmental shift. An example of such a shift is the impending depletion of cheap petroleum. An example of self-organization in response to it would be developing and deploying alternative energy sources. Now we can inquire whether the economic system called capitalism fits the profile of a living system. Let me remind you that I used the term corporate capitalism earlier in the essay, since what I am about to show you refers to capitalism as manifested particularly in the functioning of large corporations. Immense multi-national corporations constitute the pre-eminent business form throughout the world, and thus drive the world’s economy. Capitalism and corporatism are inseparable on a global level, which is what I had in mind earlier when I described it as dominating humanity. Self-Regulation? Now, check out what one prominent spokesman for a wing of corporate capitalism known waggishly as Cornucopianism has to say:
Professor Julian Simon wrote this in a 1996 book he edited, The State of Humanity (I added the italics in the quotation). We will now examine the basis for his mind-boggling claim that raw materials—the input of corporate capitalism—have become “less scarce” rather than more scarce. In doing so we will quickly discover how and why the industrial growth economy has split off from the world of material reality and natural systems and become a freak show. Look again at the phrase in the excerpt above that I have set off in italics: scarcity—measured by the economically meaningful indicator of cost or price. By relying on the classic market formula relating supply, demand and price (the higher the demand for a commodity relative to supply, the higher the price; the higher the supply relative to demand, the lower the price), he has barely escaped blatant dishonesty. According to that formula, lower price does indicate higher supply, therefore less scarcity. Here we come to the crux of this essay. Simon has tipped the hand of industrial growth capitalism by making a patently absurd claim based on an abstract indicator that has no validity in the real world. He has opened the door on a common practice in our economic system: using measurements that have little relationship to real world limits to guide decisions that have real world impact. Imagine a horde of Lemmings scurrying toward the suicide cliff. Within the horde may be seen some Lemmings with little notebooks and calculators, measuring the Lemming equivalent of economic well-being but paying no attention at all to the cliff up ahead. That, I believe, is roughly our situation. The economic system that unfortunately governs the fate of most of humanity, industrial growth (corporate) capitalism—with all its political and sociological underpinnings—has substituted reliance on abstract “indices” such as “price” for accurate feedback of environmental realities that ultimately determine our well-being. Invoking the archaic market formula, without accounting for such system distortions as government subsidies and externalizing costs, is dangerously absurd. In cutting off accurate deviation-reducing feedback, one of the essential features of viable living systems, capitalism has increased its risk for demise as a system. As discussed below, the consequences of that demise could be devastating Self-Organization? Growth is the shining beacon for our economy. All indicators revolve around showing growth or the lack of it (Gross Domestic Product, GDP, is foremost among these indicators). Economists speak openly about this, proudly and with and no apparent awareness of the loop’s lethal potential. How can such ignorance persist? Herman Daley suggested an answer to this question in a paper he delivered at a conference in 1982
Some excuse! To overlook the fact that a growth economy grows, and that this one has grown so huge that the ecosystem can no longer serve benignly as endless source and sink seems not just dumb, but willfully perverse. I have found no clearer demonstration of that perversity than another statement by Julian Simon, whom I quoted earlier. This appears near the end of the article I quoted from:
Simon obviously didn’t do the math on this flamboyant claim, but someone else did (retired physics professor Al Bartlett). Calculating population growth for seven billion years, even at a minuscule rate of growth per year, the number of people to be fed, clothed, and supplied with energy would vastly exceed the number of atoms in the universe. This is precisely the sort of obvious natural limit that Simon refused to acknowledge, and that those he spoke for still refuse to acknowledge. But even the triumphant seven billion year bleat wasn’t enough for Simon. The very next paragraph ends this way:
What havoc will ensue if growth continues to foment growth in a positive feedback loop for even a few years longer—never mind 7 billion? Global climate change and sharp depletion of cheap oil—both, arguably, direct outcomes of “growthmania” (Herman Daley’s term)—are already on us. Who knows whether the financial strain of repairing damage caused by ferocious hurricanes, rising sea levels, and other extreme outcomes of global climate change will begin ruining banks and insurance companies, perhaps setting off a relentless cascade of economic chaos throughout the system? Coupled with the radical slowdown the economy is bound for as energy costs rocket up and the housing bubble collapses in the wake of predatory lending practices, we could be looking at large scale, across-the-board disaster. The system we have known and relied on could fall apart entirely. If that happens suddenly, we will see a world of hurt, literally. More gradual disintegration could allow for transformations in the system that would turn it around and make it viable. The first would be system death; the second would be self-organization. A third possibility would be self-correction prior to extreme crisis, but the system appears to have too much inertia—denial, massive investment in the status quo, simple ignorance, etc.—for that to happen. I can’t predict which it will be, but based on the thoughts I have shared in this essay, one of the above outcomes is inevitable. Our current economic system cannot last. Common sense requires that we begin devising alternatives. Step right up, ladies and gentlemen— No crowding please, ladies and gentlemen—room for all. Ladies and gentlemen, once inside, * * * Going Further David Korten’s 1999 book The Post-Corporate World: Life After Capitalism also touches on systems principles, but mostly it provides a treasure house of information about the historical and cultural background of industrial growth capitalism. In quoting Herman Daly, I chose for brevity’s sake to leave out fascinating revelations about money, how its nature has changed over time, and how its current fetishistic attributes underlie many of the ills of modern capitalism. To remedy this omission, I recommend reading his book For the Common Good (Beacon Press, 1994). Korten and Daly (and quite a few others) offer excellent ideas about transforming the freak show economy into a system that better serves humanity and sustains itself naturally. That would be a very good thing to get started on, and soon. The Spring Creek Project for Ideas, Nature and the Written Word provided crucial support in bringing this essay to fruition. I dedicate the essay to the memory of Franz Holb. |