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FINGERS OF INSTABILITY
Karl Arnold Belser
17 May 2017




I intend to manage my circumstances and behavior such that I am antifragile. That is I want to avoid situations that are inherently unstable as described in catastrophe theory.

Catastrophe theory was intended to be the calculus of discontinuous systems but In most cases it proved too complicated to be practical. However, one can attempt to recognize situations that are inherently unstable. in this post I want to try to identify some of the situations in the world today that seem close to instability.

There are two types of situations, ones in nature and ones that involve people. The first is like a growing sand pile that at some point will avalanche and the other is like provoking a wild animal that may either run away or attack. I am more interested in the later - behavioral economics.

1. Too much debt.

 Many nations in the world are taking on large amounts of debt in order to compensate for an economic down turn. This has never before been done on such a large scale. Hence, there is no history to help predict what might happen.

The central banks are assuming that exponential economic growth can be rekindled, which if true would allow the debt to be repaid. However, I think that the world economy is in a steady, no growth, state.

The Olduvai Theory of peak energy predicts that the world has past its peak  prosperity in the 1970s and that either the population of the earth will shrink into sustainability at about 2 billion people or that civilization will collapse entirely. The latter would be because of war, famine or disease.

So what might the corresponding fingers of instability be ?

a. There might be run away inflation.
b. Many countries might default on some of their debt.
c. The social contracts for health and retirement benefits might be canceled.
d.  Democratic societies might collapse when a majority of the populations in those countries cannot support themselves.

2. Big data

More and more of commerce is being done on the Internet and there is a push worldwide to eliminate paper money so that every transaction can be tracked. this might allow people processing this type of data to make good models of each person in the world. Then they can be micro targeted and manipulated using social media like Face Book. Microtargeting can be used to influence buying or voting.

a. Democracy might not be possible under this kind of influence.
b. There might be civil unrest when the population discovers that they have been manipulated to their detriment.

3.  Psychological manipulation

The other manipulation factor is the illusion of truth effect as I describe in my posts Big Nudging and   Truthiness. In short almost every person will conform to what the herd does when told many times that a statement is true even if the person knows factually that the statement is false.

a. Universities might be shaped to teach only politically correct ideas which would be a kind of censorship.
b.  Politicians with a lot of power could be bullied by the media with "false Facts" resulting in a violent response.
c. The government might be influenced to bankrupt a nation in the name of humanitarianism and social justice.
d. Too many people might be encouraged to go into debt to get a worthless education which can end in debt slavery.

4. Excessive central government control

The effectiveness of central control by government is limited to the bandwidth of information between individual people and the government representatives. There is just no effective way to do this kind of micro management. Attempts to regulate with too broad of a brush can and has resulted in injustices and economic mismanagement within a nation.

The essential parts of the constitution aim to insure life, liberty and property.   The very lowest levels of society and government might want to handle things like education, feeding the poor, health care and  retirement . this low level control would promote a sense of community and allow for local human accountability when people receive benefits. The small size and good community efforts  is why New Zealand is so much better managed and economically stable than other countries including the United States.

a. Large parts of the population might be disenfranchised by to high of a minimum wage or a criminal record.
b. The costs of education medical care are escalating out of control because of lack of feedback.
c.  Creation of new businesses might be hindered by over regulation.
d.  The school system teaches out of date material and impedes the discovery process as the economic society changes.
e.  Mandates promoting certain types of goods, like corn, can result in a public health issue.
f.  Mono culture crops pose a food supply risk if a disease wipes the crops out. Think about the Irish potato famine.

5,  Automation

It appears that about half of the jobs that people do today will be automated. This automation will increase productivity but it raises the question about how to feed and house the out-of-work people. So far the government has not interfered with this trend, but at some point it will have to in order to accommodate the unemployed population.

a.  Society might decide that it doesn't need the people who are not contributing. Then what?
b.  The government might allow the discovery process for new jobs to occur instead of dictating what is thought in school.
c.  The government might decide to force the unemployed into feudal age labor pools like in Venezuela today.
    
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My first attempt at observing these fingers of instability was stated in my post Mega trends 2013, four years ago. I am amazed that so little has changed. The world is becoming more fragile as the complexity and optimization increases to try to feed, house and keep healthy a growing world population.

 
Last updated May 17, 2017
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