"Restore(s) a little sanity into current political debate" - Kenneth Minogue, TLS "Projects a more expansive and optimistic future for Americans than (the analysis of) Huntington" - James R. Kurth, National Interest "One of (the) most important books I have read in recent years" - Lexington Green
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Our own country is caught by all this, as it was in the first half of the 19th Century and in the middle decades of the 20th. We were able to adapt to survive: in the 19th by extending the franchise and in the 20th by expanding public services and mass prosperity. As a result British governments regained the authority to govern. They did so by reforming the institutions of representative government the country already had, thereby responding to the demands of an electorate emboldened and liberated by technological change.
Today, governments are once again losing the authority to govern, and for similar reasons. Another major financial crisis might lose them it completely; but a new crisis might not even be needed. Whitehall’s failure to control immigration, its puny efforts to tackle the housing question, the feebleness of our defences, the incompetence of our transport and energy policies might, whether jointly or severally, tip us over.
In the past, the country has been sustained in times of crisis by a solid body of electors who felt they had an interest in the existing structures which kept them, on the whole, safe and relatively prosperous. That body’s support is no longer so solid. The IT revolution is largely responsible. The speed of communications make governments and Parliamentary procedures look flat-footed. Increasingly the public is at least as well-informed as the Whitehall departments who are telling them what to do. It is virtually impossible to keep anything secret and anyone who betrays a confidence is regarded as heroic. The more rules we have, the more the public feels they are used as a means of flouting their spirit.
Worst of all, social media stimulate one issue politics and make the simple solution credible. You and I know that competent administration is boring and usually demands compromises. We also know that effective legislation needs careful preparation, much internal and external debate, a mind-numbing command of detail and a lively warning mechanism against the law of unintended consequences. The same applies to parliamentary scrutiny.
Any sensible electorate would be only too pleased to delegate this necessary day-to-day grunt to a Whitehall and Westminster it trusted and, although interested and argumentative, get on with the rest of its life.
Sadly, that is not where we are.
The candidacies of Trump and Sanders are in large part responses to public concerns about the problems Salisbury describes. They are inadequate responses, likely to fail politically and on their own terms and eventually to be superseded by other responses. The pot will continue to boil at greater or lesser intensity depending on who gets elected and what follows. It seems unlikely that the underlying problems will begin to be solved unless the voters develop a realistic understanding of what needs to be done, and start electing politicians who are both willing and competent to do it. It may be a while.
So, as I am devoting all my energy and time to finishing the first draft of another book, I have been following – with lashings of sorrow, pity, dread and the merest splash of schadenfreude – developments in Europe. Germany, which seems to be cracking under the weight of a full load of so-called refugees, Sweden, ditto, Brussels, where the concerned citizens appear to be too frightened to continue with a protest march against fear, and the governing authorities appear to be more concerned about the legendary anti-Muslim backlash than the certainty of Islamic terror unleashed in some European or English city. Read the rest of this entry »
After 240 years of relative quiescence, at 4:53 PM local time on Tuesday 12 January 2010 the Enriquillo fault system ruptured near 18°27’ N, 72°32’ W in an M 7.0 earthquake, followed by numerous aftershocks, mostly westward of the mainshock hypocenter. Institutional functionality, or the lack thereof, in Haiti prior to the earthquake was such that there was no local seismometer network in place, so nuances of slip in the 2010 earthquake involving several associated faults have had to be inferred from kinematic models.
The Enriquillo fault itself forms the boundary between the Gonâve Microplate and the Caribbean Plate, but seismic activity along it is driven by collision with, and subduction of, the North American Plate. The entire fault system may have begun a new cycle of large earthquakes similar to those of the 18th century, in which case there will be several more such events with significant effects in Haiti and the Dominican Republic through, very roughly, 2080.
Around half the entire US population donated money for Haitian earthquake relief in 2010. I may not have been among them, but as initially recounted in this forum in April of 2011, I was drawn into restoration work in a computer lab and fixed-wireless network in Petit-Goâve, and have subsequently assisted in similar efforts in Musac (Mizak), La Vallée-de-Jacmel. Paging through the visa section of my passport, I now find an astonishing number of red ENTRÉE and blue SORTIE stamps from the Ministere de l’Interieur et des Collectivites Territoriales / Direction de l’Immigration. My God, I’ve been down there 16 times. What was I thinking?
Something like this …
What I’m feeling for the GOP is a kind of disinterested sympathy, punctuated with schadenfreude, the disinterest arising from never having been a Republican, the sympathy from the GOP identification of a plurality of my close friends – uniformly horrified by what is happening – and the schadenfreude from the abrupt collapse of three-plus decades of pharisaical social conservatism. Turns out that eventually enough of the electorate whose resentment you’ve been stoking figures out that it’s a waste of time and fastens on to something else, something that matches their actual resentments a lot more closely. Read the rest of this entry »
Posted by Lexington Green on 13th February 2016 (All posts by Lexington Green)
[While I was finishing this post, I saw the terrible news that Justice Scalia died. God rest his soul. The GOP Senate majority should not permit President Obama to replace Justice Scalia, and should slow-walk any appointment he may make until after January 2017. That empty seat will be and should be a campaign issue. It raises the stakes considerably for the next President.]
The other day a friend asked me: “what kind of judges would Trump appoint?”
“They will be the best, the smartest legal scholars we have, people who know the Constitution up and down, the whole thing, and especially our second amendment, which no one will touch, not while I am President, the second amendment is sacred, and they will be outstanding judges, judges who will be fair, but also do justice, and keep our country safe, so that criminals like the guy who killed Kate, beautiful Kate in San Francisco, people like that will go to prison for a long, long time, or back to Mexico, where they belong, if they are here illegally. And the judges I appoint will follow the law carefully, and they will always do what is good for America. And I know some of the best people in the country who will advise me on which judges to pick, great lawyers, great trial lawyers, and I know lawyers who are great negotiators, the best in the country, some of these guys are killers, not nice guys, but tough, smart, incredible lawyers, and legal scholars, from top law schools, the best law schools, and they know who the best people are, not necessarily people you have heard of, but the best, and we will appoint amazing judges. Trust me, the American people will be very proud of the judges we pick.”
This is of course a spoof of Mr. Trump’s speaking style.
Posted by Kevin Villani on 11th February 2016 (All posts by Kevin Villani)
Long time Democrat turned Republican Donald Trump, who as a business titan relied more than any of his opponents on “Wall Street” funding, decisively won the Republican primary. In sharp contrast, socialist Bernie Sanders decisively won the New Hampshire Democrat primary by attacking his opponent’s Wall Street ties. Trump supporters apparently believe that the way to deal with Wall Street a**holes is a bigger a**hole who will negotiate much better deals, whereas Sanders supporters believe that “Wall Street (a synonym for the entire US financial system) is a fraud” requiring major extractive surgery.
Most people within the NY financial community including the numerous mid-town asset management firms agree that many Wall Street players were a**holes during the sub-prime lending debacle leading to the 2008 financial crisis, but surely the Sanders pitchfork brigade wouldn’t travel uptown. This may explain why among the thousands of books and articles written in the aftermath of the financial crisis and the Occupy Wall Street movement, Wall Street hasn’t defended itself and has found few defenders willing to go public.
Truth be told, Wall Street has always attracted more than its share of greedy a**holes. But historically they discriminated against the less profitable investments in favor of those that had the highest return potential relative to risk. This represented the brains of a heartless US capitalist system. Defenders of capitalism correctly argue that it is the only economic system at the base of all human economic progress, however unequally distributed. Progressive critics argue for greater equality, the poor made poorer so long as the better off are equally so (although this is not the way it is typically represented).
Posted by Michael Hiteshew on 29th November 2015 (All posts by Michael Hiteshew)
I’m going to predict Hillary Clinton will not be elected. I believe the majority of Americans are fed up with the lack of economic growth, high unemployment, increasingly bad race relations, politically driven riots, politically driven campus unrest, and an increasingly chaotic international situation. They’re going to vote for a change of government.
The real question is what to do when the GOP controls all three branches of the federal government. What should it do, in what order? Ted Cruz, for example, will immediately repeal what he considers all of Obama’s illegal executive orders. Nice. But of limited impact in the great scheme of things. What I’m concerned about are the fundamentals.
My list of fundamentals:
1. Replace the tax code with a lower, flat tax. Everyone pays at the same percentage.
2. Pass a balanced budget amendment. Include debt repayment in the budget.
3. Require all rules and regulations from any federal agency be approved by Congress. Require a cost-benefit analysis be included for each. Each regulatory agency and its existing rule set should be reviewed and scrubbed.
4. Pass welfare reform. Only the old and infirm should be on social benefits long term. Everyone else should be working and contributing to society. I would be open to CCC and WPA type programs to make the long term unemployed productive.
5. Repeal ObamaCare. Go to a market based healthcare and insurance system. Vastly reduce the legal hurdles and risks to providers. Include tort reform.
6. Repeal Common Core.
7. Review the costs and goals of every federal agency. Close every unnecessary agency. Start with the Dept of Education.
At the state level, I would like to see every Republican controlled governor-legislature team perform a full scale review of its school system: its administrative burden, its curriculum, its goals and its metrics. Consider voucher and competition systems to give parents a choice of schools and make schools compete for students.
People are ready for change. The future of the nation requires it. What good is attaining political power if it is not used?
Posted by Mrs. Davis on 24th October 2015 (All posts by Mrs. Davis)
The Wall Street Journal has an excellent article (behind paywall) by Andrew Staub on the budget stalemate in Pennsylvania. While the overall fiscal situation is less dire than Illinois (lottery winners are still being paid), the personalities less dramatic and the politics more genteel, the problems both states are confronting are ones the Federal government is ignoring courtesy of the Federal Reserve and central bankers world wide who tolerate the expansion of American debt.
One interesting aspect of the situation Staub passes over is the split in the Republican party. While the Republicans hold a majority in both houses, they are really composed of two factions, liberal leaning Rockefeller Republicans from the eastern side of the state and more conservative members from the west. They are not so far apart that they could be described as RINOs and Tea Partiers, but their inability to consistently act in concert has weakened their numerical majority in the past. However, they recently united to pass a sure to be vetoed paycheck protection bill that had foundered under the previous Republican governor because of resistance from the easterners. This is an indication that, at least in opposition to a Democrat governor the Westerners are starting to prevail.
On the other hand, Governor Wolf sent a tax increase bill to the House, forcing Democrat members to vote on it and the Republicans were happy to accommodate him. 73 Democrats walked the plank for their leader and 9 refused, creating division in the usually solid Democrat ranks. It will be interesting to see the electoral consequences for them.
But there is insufficient power on either side to prevail in the budget impasse. Until the schools start closing, probably after Christmas, there is little pressure on either side to move.
In addition to all this, Kathleen Kane, the Commonwealth’s attorney general has lost her law license as a result of her actions in disclosing sealed information from an investigation into pornographic emails circulating among, allegedly, PA Supreme Court staff and personnel in the AG’s department. She then accused a member of the court of sending and receiving racial, misogynistic pornography. She is under investigation for releasing the materials and the Supreme Court has suspended her license to practice law. The post of AG is frequently a stepping stone to the governorship in PA and the Democrats have lost an attractive potential candidate and leader.
Pennsylvania has been a solid Democrat state in presidential elections. But with the party torn apart, the deceased in Philadelphia may not be able to turn out in sufficient numbers next November to assure the result, if the Republicans can provide an acceptable alternative to HRM. But then PA always finds a way to leave the Republican candidate standing alone at the altar.
The 100-year threshold is also a statistical guess based on data on past storms and assessments of whether they’ll occur in the future. That means the models change every time a new hurricane strikes. The numbers being used as guidelines for construction are changing as time passes.
The standard also does not mean—can’t possibly mean—that a 100-year storm will occur only once per century. It means that such a storm has a 1 percent chance of happening in any given year. So for example, it’s technically possible for several 100-year floods to occur in just a few years, although it’s highly unlikely.
One way to look at it is that the engineers need to estimate how high a wall New Orleans needs to protect itself against a reasonably unlikely flood — say, a 1-in-1000-year event. This is the line of discussion pursued in the CNBC article.
Another way to look at it is to observe that the odds of another Katrina, or worse, within a specified period are highly uncertain. In this case a radical course of action might be called for. You do something like: take the best estimate for the wall height needed to protect against a 1000-year flood and then double it. Building such a levee would probably be extremely expensive but at least the costs would be out in the open. Or you might decide that it’s not the best idea to have a coastal city that’s below sea level, and so you would discourage people from moving back to New Orleans, rather than encourage them by subsidizing a new and stronger system of walls.
In this kind of situation the political incentives are usually going to encourage public decisionmakers to ignore radical solutions with high obvious costs, in favor of the minimum acceptable incremental solution with hidden costs: probably subsidies to rebuild the levees to, or perhaps a bit beyond, the standard needed to protect the city in the event of another Katrina. And it’s unlikely that any local pol is going to advise residents to move out and depopulate his constituency. Thus, eventually, a worst case will probably happen again.
If you had to name ten things “which changed everything” in the last 2 decades nearly all the good stuff will have crept out of woodwork from the inner pages while all the bad stuff was parading above the fold. You can even think of the inner pages as being in an endless war with the front page, in an unending battle between the ordinary working stiff and the self-important leaders. The working stiff makes and the self-important leader taxes and wastes. Booms happen when the regular Joe can temporarily outpace the great men and the years of the locust occur when the opposite is true.
This is a nice post that touches a number of important themes about progress and how people perceive it. Worth reading.
Posted by Mrs. Davis on 27th June 2015 (All posts by Mrs. Davis)
It’s hard for me to believe but I’ve finally found a reason to be thankful for FDR. Were it not for him there would not be a 22nd Amendment. And were there no 22nd Amendment, Obama would be running again and would win for the same reasons he won the last two times. Every cloud has a silver lining.
On the other hand, we are probably looking forward to the most interfering and disruptive ex-Presidency since…
The description of the robot valet and cook makes it seem like dependence would make us more of a slave to the technology then the other way around, but the robot cars and drones are closer to the mark. I can’t imagine anyone waving amicably at today’s red light cameras, although many drivers would probably welcome the hail of bullets fired in their direction.
The robot reporters prediction was about 50 years too soon, but we’re now starting to see them for statistics heavy topics like fantasy sports.
The most amusing part is about GE’s role in the upcoming cyber serfdom.
Most remarkable is General Electric‘s new Yes-Man, a master-slave manipulator of incredible dexterity. Any movement the human master makes with his hand, even lifting a finger, is faithfully duplicated by the powerful slave machine. In a fantastic demonstration, Yes-Man fixed a girl model’s hair-do and applied cosmetics, all with the gentle touch of a woman’s hand.
Of course, it took awhile, but we know now that the GE Yes-Men did in fact come into existence and took over the entire company. For the past decade they apparently had the same short term forecasting skills as Mechanix Illustrated.
According to the article, this was all just a walk in the park for cybernetics pioneer Dr. Norbert Wiener who envisioned the Age of Robots unfolding before us. Well, he didn’t exactly deliver the Jetsons, but Wiener did leave us with some insights to give us some pause in our pursuit of a future with digital autonomy.
Finally the machines will do what we ask them to do and not what we ought to ask them to do. In the discussion of the relation between man and powerful agencies controlled by man, the gnomic wisdom of the folk tales has a value far beyond the books of our sociologists.
In short, it is only a humanity which is capable of awe, which will also be capable of controlling the new potentials which we are opening for ourselves. We can be humble and live a good life with the aid of the machines, or we can be arrogant and die.
Kevin Madigan revisits a theme that is anathema to many on the Right but deserves serious consideration:
As Pope Francis recently remarked, reflecting this relatively new attitude of tolerance and pluralism, “Each individual must be free, alone or in association with others, to seek the truth, and to openly express his or her religious convictions, free from intimidation.” It has been said, and not without reason, that the church changed more from 1960-2000 than in the previous millennium. Yet even today, outside Western Europe and the U.S., predominantly Christian states—Russia and Uganda, for instance—have notoriously repressive laws.
All of this is to say that traditionalist Islamic states and Muslims have not, historically speaking, had a monopoly on authoritarianism, violence against apostates, the wholesale rejection of religious pluralism, and the manipulation of religion to realize political agendas. But in the same sad set of facts lies some good news: The startling changes experienced by Western churches over the past several centuries suggest that similar changes might occur within the world of Islam.
Madigan’s piece is worth reading in full.
Bernard Lewis pointed out that the fascist authoritarianism we take for granted in today’s Arab world is itself a European import. Who’s to say that the direction of future political changes there must be negative.
One strong takeaway from this analysis is that the West should support Muslim moderates and modernisers. We don’t do that consistently, which may be an indirect cause of the Middle East’s current dire condition.
Still, many thought that globalization made war between the great powers impossible. In 1909, the British journalist Norman Angell wrote an internationally best-selling book, “The Great Illusion,” that argued that financial interdependence and the great growth in credit made war self-defeating, since it would result in financial ruin for both victor and vanquished.
Angell was dead wrong. (Oddly, it didn’t prevent him from winning the 1933 Nobel Peace Prize.) Extensive trade and financial relations did not stop Germany from declaring war on both Britain and Russia, its two largest trading partners, in 1914.
So, OK, my employer made me burn off some vacation days before the end of the fiscal year, in the form of a cap on the number of PTO hours that can be carried over from FY14 into FY15, which boundary has shifted by 3 months due to our recent change of ownership. Much lower down, my management intimated that due to certain software-release and testing milestone dates, no significant block of time off in February or March would be approved. But thanks to an unrelated M&A a few years back (a spectacularly problematic one, destined to be a business-school case study for decades to come), we now get the MLK holiday off. I decided to take the whole week and head southwest in search of sunlight. After a swing through New Mexico, I am spending a few days at Crow’s Nest, a 10-minute hike from the 6+ acres I own near Bloys Camp. It’s my first visit in four years.
Mitre Peak (1887m/6190’) as seen from my lot
This is what I would write if somebody made me enter one of those hoary MLK essay contests that middle- or high-school students get sucked into. The entries that I’ve read over the years have seemed pretty unimaginative, but it’s hardly realistic to expect much historical perspective from a teenager. The tone I’m aiming for here is, of course, originality combined with some mildly discomfiting assertions, while avoiding stereotypical politics. The structure is a simple three-parter: past, present, and (near) future.
The world weighs on my shoulders, but what am I to do?
You sometimes drive me crazy, but I worry about you
I know it makes no difference to what you’re going through
But I see the tip of the iceberg, and I worry about you …
Reading through background material on the UN’s recent request for $16.4 billion in humanitarian aid in 2015, I find that the number of displaced people was already at its highest since World War II at the end of 2013, and has risen by several million since then. Nearly all are somewhere inside or on the perimeter of the Muslim world, with Ukraine the only sizeable exception. My sense, in which I am hardly alone, is that we are reliving the mid-1930s, with aggression unchecked and chaos unmitigated by morally exhausted Western institutions. That “low dishonest decade” ended in global war with a per capita death toll around 1 in 40. A proportional event a few years from now would kill 200 million people.
Here’s one of the reasons that the FAA has seized control of all drones (including toys) and is slowing the development of automated aviation to a crawl. It’s a dumb move, since it won’t work, but they are doing it anyway.
The reason is that drones make disruption easy.
[. . .]
The big question: Will the FAA effort to control drones protect against this type of disruption? No. It won’t.
It actually makes the situation worse. It prevents the development of the safeguards an economically viable drone delivery network would produce.
Read the whole (brief) post to get Robb’s full argument, which is a plausible one.
Perhaps the FAA is motivated more by inertia and typical bureaucratic risk-aversion than by any sophisticated consideration of the likely downstream societal effects of drone development.
The FAA’s proposed regulations would mainly affect commercial drone users who would probably be constrained by liability in any case. The pilot-license requirement makes little sense except to restrict entry into the market and as a means of tracking users. These regulations are not going to be easily enforceable. Maybe the FAA is being driven in part by lobbying from airlines and police agencies. Overregulation will incentivize the development of quiet drones, camouflaged drones, miniature drones, RF-shielded drones, autonomous drones that can fly programmed courses without radio control, etc.
Big companies that can game the political system will get drones. Governments will get drones. Hackers, criminals and terrorists will get drones. Small and mid-sized businesses will pay up for approved outsourced drone services or will go without. The availability of liability insurance to cover drone-caused damage may be a significant issue.
Someone wrote that operating a drone should be like owning a dog: minimal formal regulation, ad hoc restrictions based on local conditions, and liability for damages. That seems about right.
We shall see what happens. At this point I’m more concerned about the FAA than about caltrops.
And yet there are signals of personal defeat which are like red lamps on broken roads, to these we must pay heed. I grew anxious when a man’s speech began to betray him; when he was full of windy talk of what the Boche had done in the new sector the battalion was taking over, of some new gas. It was always about something which was going to happen; the wretched fellow must have known the mess would muzzle him if it could, but he seemed driven by some inner force to chatter incessantly of every calamity that could conceivably come to pass. It was as if he had come to terms with the devil himself, that if he could make others as windy, his life would be spared. How full of apprehension the fellow was; death came to him daily in a hundred shapes. This was fear in its infancy. It was a bad sign, for when a man talked like that, his self-respect was going, and the battle was already half lost. It was just a matter of time. Such a man did the battalion no good for the disease was infectious; I was glad to get him away.
Not everyone is helpful in what Strauss and Howe call a Crisis Era. This is not a matter of ability or resources, but of attitude. I have recently encountered numerous highly intelligent, capable, and often firmly upper-middle class men who at the slightest provocation vehemently insist that the United States is doomed. This year alone, they have predicted at least three of the last zero national calamities. Repeatedly failed scenarios make no impression on them. Some of these people are actually planning to run and hide somewhere. Read the rest of this entry »
as airline stocks tracked – and predicted – Ebola did not become established in the US
Although the false alarms might continue for a few more weeks, we have obviously transitioned into the lessons-learned phase of the Ebola non-outbreak in the US. I will list those lessons below, but first, a useful summary of a talk I attended on the evening of Tuesday the 4th.
The venue was the Johnson County Science Café, a monthly forum sponsored by Kansas Citizens for Science. Johnson County is, by some measures, the wealthiest county in the country outside of the DC and NYC metro areas; greatly simplifying, this is a product of a somewhat unique combination of blue-state salaries and red-state cost of living. Kansas Citizens for Science was founded in the wake of upheavals on the Kansas Board of Education, which resulted in the initial imposition of, and subsequent drastic changes to, science-curriculum standards for public primary and secondary schools for ~300 school districts half a dozen times between the early 1990s and mid-2000s. The most famous was a 1999 board vote to remove key questions about the historical sciences (including astronomy, geology, and paleontology) from assessment testing, but there were several others which either re- or de-emphasized those sciences as the makeup of the board fluctuated with each election. After a decade and a half of chaos, as of now the board is relatively quiescent – its makeup was ironically substantially unaffected by this month’s wave election – and teaching and testing of the historical sciences is in place. I know several of the key personalities involved, and could certainly tell some interesting stories, but that controversy is not the subject of this post. Read the rest of this entry »
Posted by Grurray on 22nd November 2014 (All posts by Grurray)
“Essentially, all models are wrong, but some are useful”
-George E.P. Box
Models, predictions, and forecasts are always wrong, or, more accurately, they’re never completely right. That’s obvious since the map can never truly be the territory. Some are better than others, but no matter how hard we try and how much information that we gather, we’ll never construct a representation of reality better than the real thing. That being the case, forecasts therefore reveal more about ourselves and our present state of mind than anything about the future.
The Research Feature in the fall issue of the MIT Sloan Management Review, “Beyond Forecasting: Creating New Strategic Narratives” (link here – requires a one time registration – or purchase Kindle article here for a few dollars), concerns a certain type of forecasting called scenario planning. The authors studied a tech company that was being hit hard during the 2001 economic crash and needed to find new strategies to navigate the rough seas ahead.
Their research revealed that
“future projections are intimately tied to interpretations of the past and the present. Strategy making amid volatility thus involves constructing and reconstructing strategic narratives that reimagine the past and present in ways that allow the organization to explore multiple possible futures.”
These explorations of possible futures, more commonly referred to as scenarios, are stories intended to describe possible futures, identify some significant events, main actors, and motivations, and convey how the world functions.
The authors note that constructing forecasts based on these methods usually doesn’t work very well because the future is uncertain and often unfolds in a way that is very different from current trajectories. The current paths are comfortable and familiar, so they are difficult to deviate from. Constructing scenarios of the future actually first requires constructing paths that connect the past, present, and future. The narratives are those paths.
”In comparing strategy projects within CommCorp, we found that the more work managers do to create novel strategic narratives, the more likely they are to explore alternatives that break with the status quo. In other words, to get to an alternative future, you have to create a story about the past that connects to it.”
Predicting, prognosticating, and prophesying have been around since time immemorial. The modern version of strategic scenario planning can be attributed to Herman Kahn at the Hudson Institute and his “thinking the unthinkable” about nuclear war by taking into account non-linear, disruptive changes that lead to an uncertain future. The first to bring scenarios into the business world was the pioneering strategy guru Pierre Wack at Shell Oil who coined the term. Wack was a colorful and imaginative individual who took Kahn’s insights and repurposed them to affect the quality of judgment rather than quality of predictions.
Among the many books, case studies, and articles on the Shell planning department, I just completed The Essence of Scenarios: Learning from the Shell Experience, a history of the scenario group culled from interviews of former members. Pierre Wack helped found it and headed it throughout the 1970s. The book concerns the entire history from then until the present, but it devotes a large part to Wack’s work and legacy.
In contrast to Kahn’s theories, Wack was less concerned about decoding uncertainty or getting predictions right and more concerned with making future uncertainty more relevant to the present situation.
“Wack was interested in scenarios as a way to ‘see’ the present situation more clearly, rather than as a basis for knowing about the future. The value of the scenarios is not in better forecasting what ‘the’ future will be, but in encouraging already smart people to learn by ‘seeing’ the present situation afresh, from the perspective offered by plausible, alternative futures , in a process that Wack termed ‘disciplined imagination’.”
With an emphasis on present adaptation instead of future clarity, their first attempts happened to be nicely prescient. Their November 1971 scenarios covering “Producer Government Take/World Economic Development” and their January 1973 scenarios for “Impending Energy Scarcity” presented different tracks for oil prices including: a low slow growth scenario based on the continuation of past agreements with producer countries, a track that the corporate leadership expected; and a high price growth scenario which factored into concerns that producer countries were reaching limits to how much more capital inflows they could absorb.
These scenarios involved explorations for prices through the late ’70s into the early ’80s. It’s important to keep in mind that, in keeping with the notion that they weren’t meant to be exact predictions, the high price track scenario still ended up being off by a factor of 20 as oil embargoes and inflation pushed prices higher than anyone could have imagined. Despite the fuzziness of the numbers, however, presenting a possible future far off from what was expected shifted thinking outside the company’s comfort zone.
There was some initial skepticism from top executives, but the scenario planning helped the company to think differently and conditioned them to adjust in flexible ways that they wouldn’t have considered previously. Consideration of the high price track eventually led to Shell investing in nuclear and coal which helped offset the political turmoil and price shock that would arrive in the mid ’70s.
“In October 1973, the first oil crisis began to unfold, and the entire organization became aware of the possibilities that scenarios offered. The 1973 scenarios report had provided a new frame of reference – the mindset of the oil producer countries. This new frame was significantly different from the usual analytical frame – the mindset of an oil company. The scenarios had enabled Shell executives to rehearse the future as a thought experiment rather than a crisis exercise. When the crisis actually occurred, Shell was able to collectively re-interpret the turbulent situation and to respond much faster than its competitors.”
In order to be taken seriously, the Shell scenario team had to relate to top management how the oil producers’ situation related to their own situation.
“In September 1972, Wack gave what those present remember as a three-hour, enthralling performance that was based on an image of the six scenarios as a river forking into two streams, each of which divided into three tributaries. The insight about hither oil prices and possible energy crisis… were integrated into one of these scenarios.”
This technique demonstrated the narrative of how the high price scenario was linked to Shell’s operations and how it could have sprung forth from Shell’s past. The key was teasing out the culture, values, and qualities of the past that could make that future plausible.
Similar re-interpretations of the past are what the MIT researchers found were most successful for their tech company. It wasn’t that they provided better predictions, but it helped provide a unifying vision and get everyone to buy into course changes that didn’t seem to fit before.
“the crash in the market for its existing products had forced everyone at CommCorp to reevaluate the company’s historical strategic trajectory. This questioning enabled one manager to reinterpret CommCorp’s history, not only as a provider of big-ticket hardware for the backbone of the Internet but also as a provider of communications technologies across the whole network. By seeing the company as all about “communications,” the manager was able to propose a project for improving access at the “last mile” of the network. This reinterpretation made a radical shift in a future vision possible: CommCorp could provide small-ticket, standardized products as well as customized, high-end technologies.
The narratives and scenarios became a way to define the company as it was today and illustrate a more coherent organizational structure. This is possible because of the rich potential of examining the past.
“strategy making is not about getting the ‘right’ narrative. It’s about getting a narrative that is good enough for now, so that the organization can move forward and take action in uncertain times. This recognizes that strategy will in some ways always be evolving and “emergent.”
Everyone loves to try to make predictions, but the real value lies in re-evaluating the past and restructuring past trajectories to provide for a launching point to navigate into the future. This “re-programming” the past is the way to deal with an uncertain future. Instead of forecasting futures that merely extrapolate from the status quo or futilely fighting future models that conflict with conventional mental maps, the use of narratives, scenarios, and strategies provides ways to create stronger and more harmonious models of the present.
Posted by Trent Telenko on 18th November 2014 (All posts by Trent Telenko)
The most important issue is missing from debate over the coming Obama administration’s “Executive Amnesty for illegal immigrants.” If such an action is taken without even an attempt at impeachment, we will mark that day as the day the U.S. Constitution was murdered.
Certainly some Constitutional forms will hold on another decade or two, but the relevance of Congress to federal policy making, Constitutional branch separation of powers generally, and ultimately the rule of law will be gone. Future generations of Americans will mark the Constitution as a dead letter from that day. Our American birth right to the rule of law and ordered liberty under the Constitution will have been traded for a blatant pursuit of power by any means necessary. Ultimately such power only comes from the barrel of a gun, and here only one side has guns.
That President Obama is dissolving the Constitution for a faster influx of non-white voters so he can dissolve the current declining white majority polity shows a deep love of power, and a deep hatred of any past or current American cultural institutions, that gets in the way of his power.
This isn’t new. Leftists in America have been heading down this road since before the Cold War between America and the Soviet Union started in the 1940’s.
What is new, and the real test here, is acquiescence of the opposition party (Republican) elected elites to this turn of events. They have preemptively surrendered the only real counter to this Executive usurpation of the Legislative power, impeachment of the President, for purported fear of a voter backlash and loss of their new majority in Congress.
The coming failure of the Republican Congress to do their Constitutional duty means the Republican Party is led by the same sort of narrow partisans who lead the Democratic Party, i.e., men more concerned with their fleeting power than their duty, America or freedom. Why should any of the American people obey the law when their elected officials openly defy it and their Constitutional obligations? Their elected representatives in Congress would replace the rule of law with the rule of men for the sake of their own power.
It may be that impeachment of President Obama for his proposed unconstitutional mass amnesty of illegal immigrants costs the Republican Party its new majority in Congress. Not even trying is simply the short road to hell. “Bad men need nothing more to compass their ends, than that good men should look on and do nothing” – John Stuart Mill. Failure by the GOP Congressional majority to even try to impeach President Obama here would be a clear and overwhelmingly powerful message to the Tea Party and others on the Right that only violence, and not the ballot box, is the answer to Executive tyranny.
For while Democrats and current Republican leaders may not remember, the following words are the cultural DNA of the American people, and it only took 1/3 of them to win the Revolution and drive out a Superpower:
“…And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.”
The stock market began to recover from its recent selloff as initial ebola fears abated. Meanwhile bond markets remained strong.
Conclusions? The fed-fueled bubble bull market in stocks isn’t over. Ebola won’t kill us all. Future Ebola outbreaks will have to be much more severe to generate market reactions of similar magnitude. (Corollary: The next Ebola-inspired market selloff will be a buying opportunity, and thus may not happen.)
Caveats. Watch for a govt bond selloff, perhaps as a result of unexpected events. The entire financial world has been watching for this for the past several years. It could happen in two weeks or two years, but it will happen eventually.
Disclaimer: This is not investment advice. You would be crazy to listen to me and probably shouldn’t even be reading this, as I have predicted twenty of the last 2 bear markets in bonds.
[Readers needing background may refer to the first member of this series, Don’t Panic: Against the Spirit of the Age, posted last month. This post, unlike that one, was hastily written due to time constraints involving, perhaps ironically, international travel to a Third World country.]
Constructive foreword: suggested case studies in disruption are the Chicago blizzard of 1/13-14/1979 (~3 million commuters immobilized) and the Milwaukee Cryptosporidiosis outbreak of 3/23-4/8/1993 (~400k residents sickened simultaneously).
Thesis: I argue that, at least with Ebola, inept and overwrought responses pose far greater risks to American society than the disease itself. With regard to managing the risks associated with Ebola in the US, it is vital that we identify easily disrupted institutions and design our processes intelligently to avoid creating bottlenecks, mostly by resisting the urge to overreact; likely candidates include … Read the rest of this entry »