Inviting meltdown: Preserving the Status Quo with Artifice and Lies Leads to Systemic Collapse

These few words refer to the “economic domain” and, in particular, the sad state of the Euro. However, what I wanted to highlight (perhaps reiterate would be a better word) is the universality of complex systems. Hence the ability for us to learn lessons in economics from biology, politics from forestry management, etc.

But these are lessons that each and every business owner or wannabe business “leader” would do well to understand and apply NOW and NEVER FORGET! This isn’t new news or new wisdom and if you don’t believe me, contemplate this, from a few centuries ago:

“…in its beginning it is easy to cure, but hard to recognise; whereas, after a time, not having been detected and treated at the first, it becomes easy to recognise but impossible to cure”

– Niccolo Machiavelli

Current and (in the case of some “Arab Spring” regimes) recently departed leaders who are products of the prevailing culture: in business; finance; politics; religion, have demonstrated that they were never fit for office, allowed themselves to be seduced by power or wealth, disregarded advice, surrounded themselves with “yes men” or had sufficient “incentive” to ignore good counsel.

*The current/next generation  MUST apply the lessons that history and nature keep on teaching us…

Fortunately for us, when our immune system identifies a cancer cell, the cancer cell can’t demand to be saved by threatening to kill the entire system. You see the irony here, of course; the cancer cell will destroy the entire organism/system if it is spared, so its threat to bring down the entire system if it is eradicated is pure self-serving artifice…

A system which suppresses information and the low-level instability of dissent and negative feedback thus suppresses the information the system needs to remain stable. Suppressing dissent, facts, transparency and feedback inevitably destabilizes the system. It is ironic, isn’t it, that the suppression of dissent, facts and transparency creates the surface illusion of stability, but it is only a facade. Beneath the surface, the lack of information and low-level fluctuation/volatility builds up system instability which is suddenly released as non-linear, chaotic volatility and collapse.

What Europe, the U.S., China and Japan have now are leaderships that substitute lies for fact, obfuscation for transparency, artifice for feedback and propaganda for communication. The essential negative feedback of dissent has been choked off, leaving only self-reinforcing positive feedback loops in the system, feedback that inevitably leads to runaway collapse.

In a financial example, when the negative feedback of short positions is banned, then there are no buyers left when the selling begins. The selling cascades, triggering more selling, which then feeds more selling until the bid disappears entirely.

The only question left is how much longer the system can wobble unsteadily before it finally collapses in a heap of depreciating euros.

via charles hugh smith-Preserving the Status Quo with Artifice and Lies Leads to Systemic Collapse.

* Joseph Tainter, Jared Diamond, Ulrich Beck, Buzz Hollings, Joseph Schumpeter, Lorenz, Haldane & May, Nassim Taleb, Benoit Mandelbrot and I am sure others, who don’t immediately spring to mind, have all contributed to our knowledge of the nature of complex systems but being wise after the event serves no-one well!

The impact of the lack of transparency is one reason why I applauded the work of WikiLeaks…albeit with some reservations.

2 Responses to Inviting meltdown: Preserving the Status Quo with Artifice and Lies Leads to Systemic Collapse

  1. Les AuCoin says:

    Good piece. The other frightening things to consider are that: 1) Unlimited money in modern politics lures our governors into the default position saying “yes” to interests–left and right–when “no” is the right answer for the common good; and, 2) The need to sate the public’s longings fails to tamp down our material expectations when in fact we cannot sustain our present consumption of goods and government services.

    Congressman Les AuCoin (ret.)
    The Les AuCoin Blog

  2. Les: many thanks for “stopping by”. You are far better qualified to comment on the Political system than I and your comment, although worrying, wont be too shocking for readers of a nervous disposition!


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