Thursday, 23 October 2008

How on earth can you say that??

A few days ago the second issue of Red, a magazine published by the Office of External Relations, Griffith University, Nathan Campus, arrived on my desk. Throughout its elegantly designed pages it features contributions from the university’s academics. Griffith’s vice-chancellor, Professor Ian O’Connor, fills the editorial.
In it he speaks about the strong role universities must play in order to “develop students’ civic responsibility, engagement and contribution”; “build social cohesion through mutual understanding”; open “pathways some may have considered blocked”.
How wonderful it all sounds. How smoothly it nestles inside the artful layout, the subtle scent of rich paper which, we are assured, has been made from sustainable forests.
And what a world away it all is from the reality that has the same Professor call the police to have me removed from his campus because he didn’t want to talk to me; that caused records of examiners be destroyed to hide their identity lest their miscreant evaluation of a thesis may be examined in full light.
Words set in clean typeface against an aesthetic background can mean almost anything without loosing their gloss. The cocoon of luxury protects so well from the miasma beyond.
Here’s a contribution regarding the Iraq war. The costs of this calamity have surpassed the trillion mark as David Leonhardt writes, using some examples of what that sort of money could buy for his nation. Much harder to put into figures is the damage done to people’s lives, the suffering and the loss.
Politicians, like vice-chancellors, hardly get to touch what they speak of. That’s why presidential candidate John McCain suggested in June this year the US could be staying in Iraq for another hundred years. A hundred years!? Is there any concept of what an entire century of such a war means?
A cocoon comes in many guises. It can also shield from the deeper currents of one’s heritage. When our prime minister declared photos of naked juveniles by Bill Henson “disgusting” it was like a slap in the face for a European such as myself. I have walked ancient streets, touched centuries-old timber, and grown up with the gifts of great minds. The works of a Caravaggio, a Rodin, or a Klimt will not be relegated to shame and guilt just because a Queenslander cannot stomach certain art.
Cut off the roots and the trunk will succumb to every ripple. Daring to ask “what if”, surely the most powerful two words in any language, accompanied every celebrated human endeavour. Steven Berkoff so eloquently called on this courage to push the boundaries, but when Melissa Lucashenko presented us with the antithesis her audience had sunk into cultural amnesia. For 50,000 years, she told them, Aborigines did not change their life style. This is what a nation’s mindset should adopt? 50,000 years - another concept whose meaning could not pass through the wall of intellectual isolation.
Great civilisations need powerful minds to sustain them. But when those minds retreat into a vacuum, their words hollow shells without the substance that once shaped them, then the emptiness engulfs us all.

Thursday, 16 October 2008

Dumbing down: ambiguity vs precision

Dumbing down can occur in many ways, some more insidious than others. One of the most dangerous forms relates to the misuse of ambiguity and precision.

To illustrate what I mean consider the following sentence, "Standing next to a passing express train is quite an experience".

The statement is evocative because it conveys the context of danger in a manner most can relate to. But why, and how?

It contains two elements that make it work, and they are opposite in nature: 'express train' and 'next'.

'Express train' defines in an unambiguous way; we understand the big heavy object, the speed and the power. Not every train can be called an express either, and so the phrasing is precise.

'Next' on the other hand is ambiguous, its scope of meaning quite extensive. Earth is next to Mars; I am living next to the city; in water the hydrogen atoms are next to each other.

Neither precision nor ambiguity are wrong as such, it depends how they are used. Suppose I change the above sentence to, "Standing 2.3 metres away from a passing express train is quite an experience". It doesn't have quite the same ring to it, does it?

The statement needs the strictly defined object as the main reference, otherwise the reference itself negates its purpose. It also needs the wider scope of the spatial configuration. Not because a distance of 2.3 metres is not informative, but because the word 'next' relates to a sufficient number of experiences to identify what it means to be in close proximity to something. That 'something', part of so many patterns our mind has processed over the years, informs us about the importance of being 'next', regardless of what we are next to.

In other words, 'next' has become the symbol for a particular, multifaceted experience and it is exactly because the scope is left open-ended the symbol has power.

Therefore 'express train' relies on its precision to inform us, but 'next' does so due to its inherent ambiguity.

Swap the types around and the sentence becomes downright silly: "Standing 5.6 metres away from something is quite an experience". See what I mean?

An analogy to the above would be two versions of a basic scenario. There is a dark room with an object inside. In version one the object is a small coin and we use an average light bulb for illumination. In version two the object is a big statue and we use a strong but narrow beam of light. In which case would the object be more easily identified?

Surely the relatively dim and diffuse light from the bulb would help us find the coin quite quickly, but a narrow beam of light needs much more work to even find the statue, let alone tell us what it is.

Symbols as open-ended representations have their uses but care needs to be taken what they are paired with. By the same token, precise definitions are important but their relationship with the real must hold. Remove either from the context they need in order to function properly and confusion results or the message gets altered, often insidiously so.

At the time of writing SBS Television is running a commercial heralding its upcoming series on indigenous history in Australia. The voice-over tells of over three hundred nations across the continent, and indigenous culture is referred to as a civilisation lasting thousands of years.

Three hundred 'nations'? A 'civilisation'? There were hundreds of tribes; yet a nation represents a formally configured society, featuring documented evidence of its instrumentalities, purposefully organised layers of activity systems, general infrastructure. A civilisation implies evolutionary achievement, literature, technology, philosophical and scientific endeavours. None of them can be found among indigenous people, wherever in the world they are.

To have the meaning of words transposed from a precise definition to the unconstrained scope of a symbol, merely because the symbol per se sounds attractive, introduces ambiguity where it does not belong while at the same time neutering the power of language to inform and instruct.

It is dumbing down at its most dangerous.

Saturday, 11 October 2008

The Wall Street story

The events on Wall Street are not only a symptom of a general malaise (see previous blog) but can be identified as certain specific functionalities going through their paces. In the process other domains become affected.

One benefit of using functionalities rather than content is the former's scalability, not so easily done with the latter. For example, a one kilogram iron bar requires a different neighbourhood than one weighing a tonne. But see them as a lever (a functionality) and that property can be applied regardless.

Since we can scale, let's start small. Consider the price of wheat per kilo and compare it with the price of bread of the same weight. Naturally bread costs more, reflecting the value-adding process it has undergone. If an economy were to consist of only two types of people, wheat growers and bakers, we have a problem with the generation of wealth. It is not enough to sell wheat and bread. If money is required to take care of things other than those two, for every unit of wheat grown and sold, and for every unit of bread baked and sold, there needs to be enough left over from the profits to pay for everything else. But how can this happen unless one party decides to up the price unilaterally and thereby condemn the other to perpetual bare survival. Such a situation cannot last.

So let's widen our model and add other materials and products and their respective generators. For the system to work the unit price of every good (and any associated service for that matter) must be such that, firstly, enough is left over for 'everything else' but secondly, some unit prices must be higher than others in order to introduce the differences necessary for someone's purchasing power to cover the scope of goods that economy is able to offer. (By the way, here are the underlying reasons why demographics featuring a small number of products can never be as wealthy as their more diverse counterparts - unless of course artificial loading is imposed from the outside)

A goldsmith, say, operates with different unit prices altogether as far as their raw materials and the end products are concerned. The proceeds from one gold ring buys many loafs of bread, and the baker needs a relatively broad customer base in order to afford jewellery. Add as much variety of materials and products as you wish, in principle the same relationships hold. There must be a general difference in unit prices across the spectrum to enable the proceeds to widen their usefulness in tandem with the richness of the entire economy.

But unit prices alone are not enough. Not only is a gold ring worth more than a loaf of bread, the output per time units of a goldsmith can be less than that of a baker and profits can still be realised.

What about the bottom rung in our model so far? Wheat growers do not necessarily come last because selling a lot of wheat takes care of the hierarchy in terms of unit prices per se. As long as the relationship in numbers between farmers and food processors is a reasonable one, the equation holds overall.

These two entities, price units and time units, can be combined for any commodity, let's call it the product unit. The discrepancies between product units (price- and time-wise) across an economy allow profits to be made, simply because there is always some price in relation to some other, and there is always some time period in relation to some other, which produce an oversupply of value (represented by money) such that some other product can be purchased.

So far we have assumed a certain intent to keep the system in balance. That view is improbable given human nature and the sheer resources needed to administer any transgressions. Most people will want to increase their profits, either through producing more or through jacking up the price. However, there are ultimate limits represented by the size of the market and its willingness to pay. Generally speaking the system settles into a balance more or less due to those factors. Nevertheless, a greater variety of products and a greater number of operators increase the chances of useful differences and hence profit making. It also means that there always will be a hierarchy of profitabilities regardless what certain idealists may wish for and regardless of the means of exchange, be that money, services, or status.

Suppose now someone wanted to work around these barriers. There are two options. Come up with a new product entirely and - for some time at least - it will have placed itself outside the dampening cycle of interacting pre-existing product units. Invent the light bulb and for the moment you have the market to yourself.

That option, although effective, is time and resource consuming and therefore not readily available (but it does exist).

Another option is to come up again with a new product, but this time one which is cheaper to implement. Remember the relationships between product units, all based on the exchange of their respective values, and made possible through our means of exchange, that is money.

If you view money itself as yet another product, the same interdependencies of price and time units can be applied. All you need to do is insert a process dealing with money alone into the flow and the same principles hold.

This is exactly what happened over the last few decades. Actually, one can argue the appearance of financial instruments started with the invention of paper money in China, or cheques by the Hanse, or, for that matter, the manipulations by the US Federal Reserve Bank early in the 20th century as the move away from the gold standard started to take hold there.

Still, whatever the performances of monetary product units may be, as long as the link between their dynamics and those of the other product units they in the end represent is not too tenuous the system will still work, because their respective time factors (of both, the money-related products and the rest) fit into the overall spectrum of delay and/or availability of products.

However, widen the time spans and eventually the system will slow down or even grind to a halt; put simply, money takes too long to reach the areas where it is required to play its part in the product unit cycles.

Right now the insertion process of an ever growing number of money-related products and their associated processes has widened the gap considerably, so much so that the combined price and time units of those products the money is meant to represent in the end are no longer able to keep pace with the processes belonging to those newcomers. The results can be seen around the world.

In principle, the solution is simple: remove those artificial products and with them their processes. In practice there are dangers. They centre on the existing linkages between those products and the others in the rest of the economy. To find the path of least damage requires a considerable data base containing the instantiated effects of products and their neighbours. Knowing what to remove without affecting their dependencies (such as they are) requires a commensurate familiarity with the economic structure in all its detail. I doubt whether such a flow chart even exists, never mind its use.

On the other hand, the system itself ensures that unviable products are sooner or later left by the wayside in any case. Natural re-adjustments come at a cost however, and the damage can be seen every time an economic system purges itself. Nevertheless, an organised type of healing should be possible once we have made the effort of pairing the functional picture with its content-related counterpart. While not an easy exercise I would suggest its costs are insignificant compared to those of a meltdown.

Yet whatever happens, it isn't the end of the world.

Saturday, 4 October 2008

Uncle Sam and his family of man

As keyboards around the world run hot punching out the latest spins on the current financial crisis this is as good an opportunity as any to append the system's view under Otoom; a view that had been established long before the present woes were no more than yet another gleam in the masters' of the universe little eyes.

Let's start with a general statement: a system, any system, does not falter just because one of its subsystems has failed. Complex dynamics cannot be added or subtracted as with a bag of groceries. Taking out one, two, or three items will still leave you with that bag, but render one, two, or three subsystems inoperable and there comes a point when suddenly there is no system - at least under the current auspices. Complex systems are like that.

The world of finance is one vast complex system in itself and connects to other similarly vast regions that define human society. Its faults are many.

For a system to be sustainable in the long term each one of its parts must contribute to its maintenance; exceptions can be entertained provided they are being managed.

One myth that defines our times relates to the idea of equality. Not the equality before the law or the offering of opportunities, but the assumption that everybody is the same when it comes to personal qualities and circumspection. The very mantra "Anybody can be president" so often espoused in the US is nothing more than a conceptual anesthetic to lull voters (the minority that actually bothers to vote) into a convenient dream. Translate such a phantasy into lending patterns and we get 'sub-prime' mortgages, a euphemism standing for dishing out money to illusory characters.

Even greed does not underwrite those practices, for greed looks for returns (even if not much else besides).

Systems are interdependent within their domains but the degree to which any one of its parts relates to any other is a function of the respective channels of communication. The data criss-crossing the landscape, their interpretation and indeed their creation, all become a matter of how well the entities perform. Larger complexes can reach a stage where the conceptual distance induces a blurring of shapes just like a building can disappear behind smog. A resident can still know about the building, but to anyone not familiar with the district it may as well not even exist.

Over the last few decades a whole range of financial instruments have been created for the sole purpose of making money out of their dynamics; they represent subsystems which have been hidden from the general population. Neither their existence nor their nature appeared on the screens of many of our regulatory mechanisms designed to rein in excesses.

Hardly any business would countenance having its stock plundered by others in order to profit from contrived opportunities only known to themselves. Yet shares and their derivatives (already removed from the source that made them possible in the first place), traded within the context of short selling or naked short selling, were dragged down arcane passages subjecting them to questionable rituals. Shares themselves are merely items of symbolic value with a tenuous link to what they are actually meant to represent. Their fluctuations in price do not reflect the hourly quality of some product but the visceral emotions of gamblers. Perception rules; psychosis is king.

Functionalities, an often misunderstood yet powerful analysis tool under Otoom nevertheless, represent our conceptualisations as they become manifest. Acuity of vision or the lack of it, is a functionality owned by receivers of information regardless of where they are found. Degeneration - another type of dynamic - can spread across areas if such progress is made possible through underlying trends. If our masters can perform in an atmosphere of shortsightedness then chances are the ambience is of a general nature that encompasses the rest of society. Thus the housing crisis rests on levels of debt reflecting a desire for instant fulfillment; so does obesity; so does road rage; so does violence in the class room.

Lack of understanding rests on a paucity of thinking. A superficiality that allowed the effects of short selling to be shrugged off as someone else's problem can also be found in the outsourcing of aircraft maintenance; in the exporting of long-developed skills; in placing infants in child care. When something goes wrong eventually the resultant indignation is a measure of the guilt waiting in the wings.

Complex systems do not go quietly. The road to dissolution may appear placid, but any one of its subsystems can spring a surprise event which then overwhelms its neighbours in a possibly cataclysmic fashion. Even if the current fallout from the financial upheaval will have been cleaned away and put down as mere murmurs they are like the creaking of beams in a mine - one too many and the collapse will have reduced the edifice to just another layer of rocks.