From INET’s “About” page:

The Institute for New Economic Thinking (INET) was created to broaden and accelerate the development of new economic thinking that can lead to solutions for the great challenges of the 21st century.

The havoc wrought by our recent global financial crisis has vividly demonstrated the deficiencies in our outdated current economic theories, and shown the need for new economic thinking – right now.

INET is supporting this fundamental shift in economic thinking through research funding, community building, and spreading the word about the need for change. We already are a global community of thousands of new economic thinkers, ranging from Nobel Prize winning economists to teachers and students who have emerged out from the shadows of prevailing economic thought, attracted by the promise of a free and open economic discourse.

Having graduated from business school in 2007, just before the monetary/financial/economic crisis really kicked into high gear, I’ve grown increasingly interested in how the economics profession (among other culpable professions/schools of thought) could fail so miserably at seeing what was coming and how it would impact our societies.  Granted, I only studied economics & finance in the context of a general business administration education, but I realized that economic theory was the intellectual bedrock upon which many important theories taught in business school rested.  If the intellectual foundation of economics resembled a castle made of sand, then I figured that, as Jimi Hendrix sang, it would “fall into the sea, eventually.”  Whether or not mainstream economic thinking has fallen into the sea, is open to debate.  But I would argue that organizations like INET, the New Economics Foundation, and others, are a clear indication that there is a growing appetite for a major re-thinking of economics.

Although I just found out about INET, I must say that I’m impressed with the quality of content & thinkers profiled on its website.  I still have more to explore about INET, but the fact that I found recorded interviews and talks by thinkers like Thomas Homer-Dixon, Satyajit Das, and William Rees, makes me confident that there is a wealth of relevant, and leading-edge thought going on in this community.

On that note, I wanted to embed a video of a talk given by one of the major intellectual influences of this blog – Thomas Homer-Dixon.  The talk, given at the 2011 Bretton Woods Conference called Crisis & Renewal: International Political Economy at the Crossroads (link), discusses Homer-Dixon’s recent thinking on complexity theory as it pertains to economics & public policy.

More on Thomas Homer-Dixon:

www.homerdixon.com

More on the Institute for New Economic Thinking:

www.ineteconomics.org

More on other organizations & schools of thinking related to heterodox economics:

• Institute for Integrated Economic Research (link)
• New Economics Foundation (link)

You can find out more about Professor Chang at his website (link)

Something that is noticeable in Sedlacek’s economic thinking is the moral philosophy aspect.  Most economists often speak with a lot of “shoulds”, but very few have any real background in the history or moral philosophy behind economics.  In this regard, Sedlacek is a refreshing break from a lot of the economic thinkers who focus too narrowly, or don’t incorporate historical thinking.

In any case, it’s worth checking out.

A few take-aways from Sedlacek’s talk:

• Economics is now a religion – we ask it today, the same questions that we asked Gods in earlier days.
• Compares the dicey relationship of monetary policy & fiscal policy to JRR Tolkien’s Ring in Lord of the Rings.  A force that is too powerful to be allowed to exist.
• How interest is analogous to alcohol.  Interest & alcohol are similar in that that they allow us to make energy time-travel from the future to the present for the purposes of current consumption (and leverage).
• Talks about the wisdom of Aristotle, the Islamic tradition & the Pharaohs with respect to interest rates & business cycles.

Additional Resources:

Does Economics Trump Ethics? Does it Pay to Be Good? (link)

Thomas Sedlacek’s site

I’m glad I changed that.  Below is a talk that Ramachandran gave at a 2009 TED Talk in India.  Ramachandran is a Professor of Psychology & Neurosciences at the University of California at San Diego.

I particularly like how he brings in the discussion of mirror neurons and ties it into Eastern philosophical principles of non-duality.  He calls mirror neurons “Gandhi neurons.”

Definitely a great, info-packed talk by an influential mind on a very important topic.

So, while there might be something called “the Truth” with a capital “T”, in reality, all we can ever know are “truths” with a lower-case “t”.

It seems like nobody really knows what the hell is going on right now.  We might think we know, but in actuality, all we know is some small subset of reality.  We see the world in what Robert Anton Wilson called reality tunnels.

The way I think about this idea that we’re all seeing a different subset of reality, is with reference to the parable of the blind monks trying to describe what they don’t know is an elephant.

About the parable, Wikipedia says:

The story of the blind men and an elephant originated in India from where it is widely diffused. It has been used to illustrate a range of truths and fallacies. At various times it has provided insight into the relativity, opaqueness or inexpressible nature of truth, the behaviour of experts in fields where there is a deficit or inaccessibility of information, the need for communication, and respect for different perspectives.

As the blind monks illustrate, we all have our own reality tunnels through which we see the world.  Depending on our lens (i.e. ones position vis-a-vis the elephant), we might think what we’re touching is a tree trunk, or a rope, or a fan, but if you’re only seeing your reality through that one lens (of touch), it’s easy to miss that it’s an elephant.  To the able-eyed observer – someone who sees the situation from a different dimension – it wouldn’t be an issue to identify the object as an elephant.

The trick is to recognize that, like a digital SLR camera, there are multiple lenses, filters, and hence, reality tunnels through which we can view the world.  Having multiple perspectives from which we can describe and approach a situation allows us to get a more holistic sense of what’s actually going on.

Given how many pundits & gurus have been proven dead wrong over the years due to their rigid views, a good analyst nowadays knows to look at phenomenon from a variety of different angles.  By taking a multi-dimensional & evolutionary view, and by studying the different forces that influence a system, one gets a much better sense of how a system operates than would applying rigid organizational plan and operation philosophies.

If only the machine minds of the world could broaden their thinking about causality & the nature of reality – perhaps we could then see the elephant in the room.

Great video via Po-Chen Chia (link).

Check it out:

“[Our] paradox is the ceaseless, constant drive to understand something that is inherently un-understandable. Now, of course, the paradox lies in the fact that we understand it is not to be understood, and yet we understand that we continue to try to understand. It’s a beautiful paradox.”

- Dr. William Rowlandson

via Matrix Masters (link)

A great Carl Sagan video – This Pale Blue Dot:

The reason I was encouraged to post this FORA.tv talk was the result of a recent interview I listened two where David Eagleman spoke Jay Hughes of the Institute for Ethics & Emerging Technologies on his “Changesurfer Radio” podcast.

Description from the IEET post on “The Net, Brains, and Civilizational Resilience“:

Dr. J. chats with David Eagleman, a fellow of the IEET and director of the Laboratory for Perception and Action and the Initiative on Neuroscience and Law at Baylor College of Medicine. Eagleman is author of the bestseller Sum, on fictional afterlives, Wednesday is Indigo Blue, about synaesthesia, the e-book Why the Net Matters and the forthcoming Incognito: The Brains Behind the Mind. They discuss the thesis David outlined for the Long Now Foundation that the Internet makes our civilization more resilient than previous ones.

Given just how central energy is to sustaining complexity (i.e. making everything work), I’m still not entirely convinced that the internet will solve all of the problems we face in this century.  I certainly agree that it gives us a better chance of managing our civilizational risks – but that assumes the keepers of the status quo don’t fight it.  With concerns over the freedom of the internet growing every year due to cyber warfare and other disruptive possibilities, it seems at least possible that much of the liberating potential of the net will be muzzled instead of cultivated.

In terms of opportunities, I think any strategic thinker, entrepreneur, or good investor would be wise to seek opportunities related to the 6 ways that the internet could avert the collapse of civilization.  Presumably, if these are actually ways to avert or mitigate major future catastrophes, then those who figure out how to align with these ideas will stand to protect & benefit themselves and those around them.

For quick reference, the 6 “civilizational life-savers” according to Eagleman are:

1. Try Not to Cough on Anyone
2. Don’t Lose Things
3. Tell Each Other Faster
4. Mitigate Tyranny
5. Get More Brains Involved
6. Try Not to Run Out of Energy

Perhaps in a future post, I’ll explore these areas in a bit more detail – looking at their potential to actually avert civilizational collapse, or possible opportunities that arise out of focusing on these ideas.

Stay tuned.

Cheers,

-a.j.m.

In the film, the speaker talks about the nature of reality and our ever expanding understanding of it.  Despite how much we seem to know, the speaker makes it clear that actually know very little.

“It’s not that I think I know.  It’s that I know, with absolute certainty, that I don’t.  And I know, with seemingly identical certainty, that nobody knows, because nobody can.”

“Our poets do not write about it; our artists do not try to portray this remarkable thing.  I don’t know why.  Is nobody inspired by our present picture of the universe?  The value of science remains unsung by singers…This is not yet a scientific age.” – Richard P. Feynman

Today, I wanted to share another similar video, except that this one gives the viewer a broader scope on the size of things.  By “zooming out” to the universal scale, and then “zooming in” to the atomic scale, the video does an excellent job at portraying what exactly an order of magnitude really means.

(via IEET)

How different does the universe look on small, medium, and large scales? The most famous short science film of its generation, Powers of Ten, originally created in the 1960s, answers that question by offering eye-opening comparisons.

From a picnic blanket near Chicago out past the Virgo Cluster of Galaxies, every ten seconds the film pans out to show a square a factor of ten times larger on each side. The video then reverses, panning back in a factor of ten every two seconds and ends up inside a single proton.

Below, I share some annotations from a recent post entitled “Long Term Trends in Economic Output.”

Basically, Staniford calls out Samuelson & Nordhaus (authors of a leading economics textbook) on some of the ridiculous premises upon which economics is built.  It irks me to no end the degree to which economics is flawed, and the extent to which politicians, business people, and other power brokers use this intellectual foundation to justify their errant policies & behaviours.

We need more people like Staniford who can see through the much of the fallacious thinking being taught by economists.

Early Warning: Long Term Trends in Economic Output

From the vimeo description:

And from a fellow blogger reviewing the short film (h/t GRCP 101 blog):

This short film is only just under four minutes long. It is called “Fallen” and is about a meteorite that comes to life. The short film follows his path from outer space to the ocean. As soon as he hits the atmosphere he comes to life. At first he seems to be in awe and then he seems to be trying to figure things out. After he has been falling awhile he sees the ocean below him and becomes afraid. He tries to stop falling and climb back up, but of course fails. After he falls some more he starts to get used to it and starts to enjoy it.

Once he starts to enjoy it he starts flying around clouds, going in spirals and diving strait down. As he gets closer to the ocean he seems to know that it is about to end and seems to be at peace with it. He eventually hits the ocean and stops moving as the water cools him. I can only assume that it is the end of him because he is no longer able to move.

It is fun and interesting to see him experience falling down, going from being in awe, to afraid, to happy, to being at peace with hitting the ocean. I think the authors did a great job of showing all of the emotions the creature was going through.

I am very much still learning it’s principles, but from what I’ve learned so far I believe that it’s an extremely fascinating & useful lens through which to comprehend, cope with & adapt to the bewilderingly complex & constantly evolving world around us.

Besides the science and math principles which the course explores, Professor Strogatz also provides some examples of chaos theory in literature & art.  Anybody who has ever seen a fractal (i.e. self-similar spatial patterns – often very beautifully coloured) – knows at least something about chaos theory.

Below I share a well known parable of chaos (and a picture of the famous fractal known as the Mandlebrot set).

For want of a nail the shoe was lost.
For want of a shoe the horse was lost.
For want of a horse the rider was lost.
For want of a rider the battle was lost.
For want of a battle the kingdom was lost.
And all for the want of a horseshoe nail.

From wikipedia:

This proverb has been around in many variations for centuries (see historical references below), and describes a situation where permitting some small undesirable situation will allow gradual and inexorable worsening. The rhyme is thus a good illustration of the “butterfly effect“, and ideas presented in chaos theory, involving sensitive dependence on initial conditions; the initial condition being the presence or absence of the horseshoe nail.^[1] At a more literal level, it summarizes the importance of military logistics throughout the history of human warfare.

An important thing to note is that these chains of causality are only seen in hindsight. Nobody ever lamented, upon seeing his unshod horse, that the kingdom would eventually fall because of it.^[1]

A big lesson I’ve taken away from my study of chaos theory so far is that complex systems in a state of criticality (i.e. those that have a lot of converging forces reaching/overshooting limits in sync) have a high sensitivity to small fluctuations in certain key system components.  As such, minor changes in starting conditions can have disproportionately large consequences.  As the the bolded parts of the Wikipedia explanation above indicates, the dependence of a system on initial conditions and the inability for us to see causality except in hindsight, leads us to a situation whereby turbulence is more or less baked into the cake.

If we are to accept that breakdown is an inherent feature of complex systems, then I think that the questions we should be asking are the same as those being asked by the brilliant Canadian intellectual & complexity theorist Thomas Homer-Dixon.   Paraphrasing, Homer-Dixon asks “how do we turn the breakdown of our societies into renewal?  how do we transform catastrophe into genesis? – how do we foster the notion of catagenesis? how do we exploit the opportunities created by the coming massive non-linearities?”

My current scenario for the next 3-5 years envisions some kind of a “tipping point” event on during that time horizon.  Figuring out if it’s going to be a financial/monetary/economic tipping point (my best bet), or an energy tipping point, or an ecological tipping point or some other kind of tipping point is not the main issue as I see it.  The main issue, as I see it right now, is the recognition of and increasingly likelihood that our hyper-complexified & hyper-efficient globe-spanning system of trade & communications will hit a major non-linearity and be almost completely transformed in a very short time frame.

My concerns has to do with how we act upon these non-linear events & trajectories.  These “chaotic shifts” present opportunities for creative responses just as much as they present opportunities for ideologues with antiquated ideas to seize power.  Catastrophe can just be catastrophe – it doesn’t necessarily have to lead to creative & adaptive responses.  The big idea is that when a system is on the verge of chaos, the slightest nudge to that system can send it through either a favourable phase transition or an unfavourable phase transition – but ultimately ending up in a new state of complexity & organization (often at a lower level of complexity – but I’m open to this idea being wrong).

As I see it, the capacity & opportunity for new models to emerge is greatest during major phase transitions.  These new models may be new business/economic/monetary models, they could be new agricultural & energy models, or they could be sociocultural models – among other possibilities.  I think new models will be increasingly called upon as adaptive strategies for managing the rapid pace of change & non-linearity.

I still hold out hope that there are ideas, technologies, and social arrangements available to us today that can be used to bootstrap a new and post-modern way of living.  I can only hope that as things continue to “shift” (ever-faster), more and more people will seek and find ways of adapting to these changes in a creative & productive manner.  The alternatives don’t appeal much to me – so I’m gonna keep working towards the positive stuff….whatever that means.

Cheers,

a.j.m.

Additional Resources:

Chaos Theory (wikipedia)

via ajani.ca/blog

“Scale” is a very nice short film by Brad Goodspeed, and he describes it as follows:

“While watching the video of the lunar eclipse I posted the other day I was looking at the curvature of the earth’s shadow on the moon. It made me think about how large the earth might look if an exact copy of it was up there instead of the moon. Soon curiosity got the better of me, and I was animating!

So the basic idea is, each planet you see is the size it would appear in the sky if it shared an orbit with the moon, 380,000 kms from earth. I created this video in “After Effects”, and because of certain technical considerations had to keep the field of view at 62 degrees. That means the foreground element is not precisely to scale. I realized this after the fact and may update the video at some point in the future. All planets are to correct scale with one another in any case.”

You can view “Scale” below (via Like Cool).

More information on Goodspeed can be found via these URLs:

bradgoodspeed.com

twitter.com/bradgodspeed

vimeo.com/bradgoodspeed

–

Ajani Charles

a j a n i photography: digital image solutions

www.ajani.ca

As you may have noticed from some of my previous posts, I’ve taken a keen interest in this issue of “human nature” and topics such as psychology, cognitive bias, behavioural economics, and so on.  It seems only prudent that if you want to know what might happen in the future – you really have to (try to) understand human beings in all of their magnificent glory & tragic stupidity.

I’m glad to hear that Chris Martenson will be drawing upon the insights of behavioural economics in his future writings.

To quote Martenson:

The resulting interview is full of fresh, non-intuitive insights and shines light on how the human brain is often hard-wired for irrational action when it comes to money

…If you’re not acquainted with it already, the perspective offered by behavioral economics is a valuable addition to add to your world view. We’re definitely planning to look through its lens more often going forward.

And here’s the podcast – “Dan Ariely Decodes Why Humans Are Hard-Wired to Inflate“

Cheers,

- a.j.m.

Additional Resources:

Back in September, I embedded a series of videos of Nate Hagens giving a lecture on the demand/behavioural aspects of the energy issue – “Energy Resources & Human Demand on a Full Planet” – start watching Part 2 around 8:30 (link)

Although nobody really likes to talk about it, a lack of discussion on the topic of human population & ecological footprints is probably not a wise idea.  It’s a good thing to see National Geographic continuing to raise awareness on this critical issue.  I don’t profess to have the ethical training or understanding to really discuss these issues, but I’m at least trying to educate myself on the nature of the issue.

A line from the video: “It’s not space we need, it’s balance.”

Whether your a globalist banker talking about the need to balance the international trade & monetary system or an ecologist talking about the planetary balance of fragile & dynamic planetary systems – the big question for me at least, is, given that we (almost certainly) have overshot a variety of limits in a variety of ways, how do we get these systems back into balance? Will the process be fair, equitable and smooth or will it be cut-throat, nasty & chaotic?

I’m hoping for the former, but wouldn’t be surprised if it was the latter.

At the very least, we’re in for an interesting remainder of the 21st Century.

Cheers,

-a.j.m.

Definitely worth checking out for some recent thinking on these two major issues.   It turns out that The Nation will be posting longer clips of interviews with the various thinkers profiled in this clip over the coming weeks.  Here’s the link to The Nation’s website where the interview clips will be posted.

And here’s the video: