Cactus Club April 1999

3 April 1999................a true paradigm shift

Quoting from CHAOS by James Gleick----------------"Central to Kuhn's ideas is the vision of normal science as solving problems, the kinds of problems that students learn the first time they open their textbooks. Such problems define an accepted style of achievement that carries most scientists through graduate school, through their thesis work, and through the writing of journal articles that makes up the body of academic careers. 'Under normal conditions the research scientist is not an innovator but a solver of puzzles, and the puzzles upon which he concentrates are just those which he believes can be both stated and solved within the existing scientific tradition,' Kuhn wrote.

Then there are revolutions. A new science arises out of one that has reached a dead end. Often a revolution has an interdisciplinary character---its central discoveries often come from people straying outside the normal bounds of their specialties. The problems that obsess these theorists are not recognized as legitimate lines of inquiry. Thesis proposals are turned down or articles are refused publication. The theorists themselves are not sure whether they would recognize an answer if they saw one. They accept risk to their careers. A few freethinkers working alone, unable to explain where they are heading, afraid even to tell their colleagues what they are doing---that romantic image lies at the heart of Kuhn's scheme, and it has occurred in real life, time and time again, in the exploration of chaos.

Every scientist who turned to chaos early had a story to tell of discouragement or open hostility. Graduate students were warned that their careers could be jeopardized if they wrote theses in an untested discipline, in which their advisors had no expertise. A particle physicist, hearing about this new mathematics, might begin playing with it on his own, thinking it was a beautiful thing, both beautiful and hard---but would feel that he could never tell his colleagues about it. Older professors felt they were suffering a kind of midlife crisis, gambling on a line of research that many colleagues were likely to misunderstand or resent. But they also felt an intellectual excitement that comes with the truly new. Even outsiders felt it, those who were attuned to it. To Freeman Dyson at the Institute for Advanced Study, the news of chaos came 'like an electric shock' in the 1970s. Others felt that for the first time in their professional lives they were witnessing a true paradigm shift, a transformation in a way of thinking.

Those who recognized chaos in the early days agonized over how to shape their thoughts and findings into publishable form. Work fell between disciplines---for example, too abstract for physicists yet too experimental for mathematicians. To some the difficulty of communicating the new ideas and the ferocious resistance from traditional quarters showed how revolutionary the new science was. Shallow ideas can be assimilated; ideas that require people to reorganize their picture of the world provoke hostility. A physicist at the Geogia Institute of Technology, Joseph Ford, started quoting Tolstoy: 'I know that most men, including those at ease with problems of the greatest complexity, can seldom accept even the simplest and most obvious truth if it be such as would oblige them to admit the falsity of conclusions which they have delighted in explaining to colleagues, which they have proudly taught to others, and which they have woven, thread by thread, into the fabric of their lives.' " Question: Could the author just as well have been writing about socionomics instead of chaos theory? (PD)

14 April 1999.........................letting everybody be their own John Wayne

Quoting from COMPLEXITY by M. Mitchell Waldrop---------------"But Arthur also sensed that the hostility went deeper than that. American economists are famous for being far more passionately devoted to free-market principles than almost anyone else in the world. At the time, in fact, the Reagan administration was busily cutting taxes, junking federal regulations, "privatizing" federal services, and generally treating free-market capitalism as a kind of state religion. And the reason for that passion, as Arthur slowly came to realize, was that the free-market ideal had become bound up with American ideals of individual rights and individual liberty: both are grounded in the notion that society works best when people are left alone to do what they want.

'Every democratic society has to solve a certain problem,' says Arthur: 'If you let people do their own thing, how do you assure the common good? In Germany, that problem is solved by everybody watching everybody else out the windows. People will come right up to you and say, 'Put a cap on that baby!' '

In England, they have this notion of a body of wise people at the top looking after things. 'Oh, yes, we've had this Royal Commisssion, chaired by Lord So-and-So. We've taken all your interests into account, and there'll be a nuclear reactor in your backyard tomorrow.'

But in the United States, the ideal is maximum individual freedom---or, as Arthur puts it, 'letting everybody be their own John Wayne and run around with guns.' However much that ideal is compromised in practice, it still holds mythic power.

But increasing returns cut to the heart of that myth. If small chance events can lock you in to any of several possible outcomes, then the outcome that's actually selected may not be the best. And that means that maximum individual freedom---and the free market---might not produce the best of all possible worlds. So by advocating increasing returns, Arthur was innocently treading into a minefield." Question: Is the complex, evolving, path-dependent nature of free-market capitalism actually a good reason for central planning and social engineering? (PD)

17 April 1999..............single-loop versus double-loop learning

Quoting from CHAOS,MANAGEMENT AND ECONOMICS by David Parker and Ralph Stacey--------------"Non-linear feedback systems are driven by positive and negative feedback. Domestic central heating systems, for example, are controlled in a negative feedback way. A desired temperature is set, then a sensor measures actual room temperature and compares it with the desired level. The deviation is then fed into the control system to turn the system on if the temperature is too low or to turn it off if the temperature is too high. Such feedback is negative in the sense that the action leads to consequences which offset or cancel out the original deviation.

Any planned system is based on the notion of negative feedback. Some intended outcome, or a least some intended direction of movement, is deliberately set. Then outcomes are monitored and the gap between actual and intended is identified. Next, action is taken to narrow the gap by feeding modifications back into the system so as to secure the convergence of actual and intended. Keynesian demand managemnt is essentially of this kind. Fiscal policy is intended to smooth out fluctuations in the economy by affecting aggregate demand, in a similar way to that by which the central heating system adjusts room temperature.

As explained in Chapter 1, positive feedback is the opposite of negative feedback. Instead of feeding back the discrepancy between an outcome and an intention in a manner that closes a gap between the two, the feedback progressively widens the gap. Thus, if positive feedback prevailed in the case of a domestic central heating system, when actual temperature exceeded the desired level, the deviation would be fed into the control system. This would then cause more heat to be pumped into the room causing the actual temperature to rise even further above that desired. Positive feedback does not cancel out deviations, rather it reinforces them. Therefore, while negative feedback is dampening and stabilising, positive feedback is amplilfying and destabilising. In an economy, it is now recognised that misapplied or naive demand management policies can have similar effects. The result is increased, not reduced, economic instability (Dow, 1970).

Positive feedback appears to be sidespread in economic and business life. It can take the form of self-reinforcing growth, bandwagon effects, chain reactions, self-fulfilling prophecies, and virtuous and vicious circles. Furthermore, negative and positive feedback can be seen as two different types of learning in organisations. Figure 2 depicts managers and policy-makers going around a rational feedback loop at the centre of the diagram. They do so in a manner in which both their discoveries about how the world operates, and the manner in which they choose and act, are governed by a shared mental model or paradigm. Because they do not question that model they are practising what Argyris and Schon (1978) called 'single-loop learning'. They are learning about the consequences of their behaviour and adjusting their behaviour in the light of that learning. But they are not questioining the frame of reference within which their learning takes place. Single-loop learning is a negative feedback process associated with stabilising behaviour.

As the level of uncertainty and ambiquity rises, however, it becomes ineffective and dangerous to operate according to a mental model formulated and shared in conditions that have now changed dramatically. What is therefore required is double-loop learning in which the shared mental model is questioned and changed (Figure 3). Double-loop learning is a positive feedback process of attending to the contradictions and conflicts between what is actually happening and the expectations to which an outdated mental model leads. Thus a new mental model is acquired, which becomes the previous mental model as far as the next discovery is concerned. Double-loop learniing therefore has a destructive aspect. It is a process of making old perceptions redundant. But it also has a creative aspect in that it leads to a new mental model or paradigm. Double-loop learning has been an essential component of human development from the earliest times. It is essentially destabilising because it challenges the status quo." Questions: Is single-loop learning more common and more natural than double-loop learning? Does competition force people to engage in double-loop learning? (PD)

20 April 1999...........all those unintended patterns and regularities

Quoting from "The Results of Human Action but not of Human Design" by Friedrich A. Hayek in AUSTRIAN ECONOMICS: A Reader edited by Richard M. Ebeling-------------"The belief in the superiority of deliberate design and planning over the spontaneous forces of society enters European thought explicitly only through the rationalist contructivism of Descartes. But it has its sources in a much older erroneous dichotomy which derives from the ancient Greeks and still forms the greatest obstacle to a proper understanding of the distinct task of both social theory and social policy. This is the misleading division of all phenomena into those which are "natural" and those which are "artificial." Already the sophists of the fifth century B.C. had struggled with the problem and stated it as the false alternative that institutions and practices must be either due to nature (physei) or due to convention (thesei or nomo); and through Aristotle's adoption of this division it has become an integral part of European thought.

It is misleading, however, because those terms make it possible to include a large and distinct group of phenomena either under the one or the other of the two terms, according as to which of two possible definitions is adopted that were never clearly distinguished and are to the present day constantly confused. Those terms could be used to describe either the contrast between something which was independent of human action and something which was the result of human action, or to describe the contrast between something which had come about without, and something which had come about as a result of, human design. This double meaning made it possible to represent all those institutions which in the eighteenth century Adam Ferguson at last clearly singled out as due to human action but not to human design either as natural or as conventional according as one or the other of these distinctions was adopted. Most thinkers, however, appear to have been hardly aware that there were two different distinctions possible.

Neither the Greeks of the fifth century B.C. nor their successors for the next two thousand years developed a systematic social theory which explicitly dealt with those unintended consequences of human action or accounted for the manner in which an order or regularity could form itself among those actions which none of the acting persons had intended. It therefore never became clear that what was really required was a three-fold division which inserted between the phenomena which were natural in the sense that they were wholly independent of human action, and those which were artificial or conventional in the sense that they were the product of human design, a distinct middle category comprising all those unintended patterns and regularities which we find to exist in human society and which it is the task of social theory to explain. We still suffer, however, from the lack of a generally accepted term to describe this class of phenomena; and to avoid continuing confusion it seems to be urgently necessary that one should be adopted. Unfortunately the most obvious term which should be available for that purpose, namely "social," has by a curious development come to mean almost the opposite of what is wanted: as a result of the personification of society, consequent on the very failure to recognize it as a spontaneous order, the word 'social' has come to be generally used to describe the aims of deliberate concerted action. And the new term "societal" which, conscious of the difficulty, some sociologists have attempted to introduce, appears to have small prospect of establishing itself to fill that urgent need.

It is important to remember, however, that up to the appearance of modern social theory in the eighteenth century, the only generally understood term through which it could be expressed that certain observed regularities in human affairs were not the product of design was the term "natural". And, indeed, until the rationalist reinterpretation of the law of nature in the seventeenth century, the term "natural" was used to describe an orderliness or regularity that was not the product of deliberate human will. Together with "organism" it was one of the two terms generally understood to refer to the spontaneously grown in contrast to the invented or designed. Its use in this sense had been inherited from the stoic philosophy, had been revived in the twelfth century, and it was finally under its flag that the late Spanish Schoolmen developed the foundations of the genesis and functioning of spontaneously formed social institutions." Questions: Is there still a lack of teaching and understanding of the concept of spontaneous social order? How would the politics of social engineering and central planning be affected by a greater understanding of this idea? (PD)

22 April 1999.................take the cichlid, for example

Quoting from BIONOMICS: Economy As Ecosystem by Michael Rothschild--------------"The best example of this phenomenon of destruction and rebirth is recorded by the history of the ammonites, a coiled, snaillike creature of the ancient oceans. Like the trilobites, they fossilized easily and survived for more than 300 million years. In each epoch of their long history, a different group of species dominated ammonite life. And each great global extinction knocked out the vast majority of species in that family.

From the few that managed to squeak through each great dying, an entirely new ammonite family, with many subsidiary species, would sprout. Once established, these new species survived without modification for millions of years---until they too were wiped out. This pattern repeated itself until the Cretaceous extinction 65 million years ago, the disaster that finished off the dinosaurs along with the last of the ammonites.

The ammonites' history shows that the tragedy of mass extinction is also the harbinger of new life. By clearing the land and the seas of most inhabitants, extinctions create wide-open ecological opportunities for the few species fortunate enough to have survived. Unimpeded by entrenched competitors, they find more food and space than they can use. Some of the mutant offspring that would have been weeded out quickly in a more competitive environment survive and reproduce.

It is as if extinctions temporarily suspend the stabilizing pressure of natural selection, permitting nature to experiment with new versions of life. Exploiting their evolutionary opportunity, these offspring repopulate the nooks and crannies of the earth's emptiness. As they do, small groups at the periphery of each population bud off, and an assortment of new species springs forth.

In the past, many imagined evolution as a ladderlike progression from primitive to modern forms. But under punctuated equilibrium, particularly as influenced by intermittent extinctions, life's history seems more like a bush that has been pruned back severely from time to time. After each pruning, a few branches survive. No longer shaded from the sun's life-giving energy or crowded by neighboring branches, they propagate new shoots in every direction. When the bush regains its fullness, vigorous competition resumes for nutrition and space. Growth slows and opportunities for the development of new branches diminish sharply. Mature stability characterizes the bush of evolving life until the next great dying prunes it back and restarts the cycle of organic innovation.

Although the bush may be a better metaphor for life's evolutionary structure than the ladder, some evidence suggests that a severe pruning need not precede each new form of life. In certain cases, a modest shift in the environment is enough to create a new ecological opportunity. One of the best examples of opportunistic species creation---speciation not preceded by a holocaust---occurred in East Africa's Lake Victoria. The lake is only about 750,000 years old, but it is home to 170 species of fish found nowhere else in the world. All the species are members of the cichlid genus. Some species eat only insects, others eat only fish larva, some specialize on mollusks, others just eat water plants, and some subsist solely on the scales of other fish. Each cichlid species has a mouth and digestive system optimized for its food source.

The ancestral cichlid species still flourishes today. It is an unspecialized type with simple teeth that has lived unchanged in the rivers of Africa for millions of years. Apparently earth movements dammed up some of these rivers and formed Lake Victoria, one of the largest bodies of fresh water on the planet. Rather suddenly, a vast and uninhabited freshwater environment appeared out of nowhere. Unhampered by competition, the ancestral cichlids fanned out across Lake Victoria and turned wide-open ecological opportunity to their advantage.

Groups became reproductively isolated in this immense body of water, and genetic mutations interacted with distinct habitat conditions in the various parts of the lake to create an array of distinctive new species. Once Lake Victoria's potential cichlid niches were filled, natural selection strengthened, new speciation dropped off, and ecological stability was reestablished. The sudden blossoming of innovation was a natural response to opportunity." Questions: Does this example help to explain not only the business and economic environment but also cultural and social variations from one geographic area on the planet to another? What is the role of disorder in the evolution of complex adaptive systems? (PD)

26 April 1999..................coercion or persuasion

Quoting from TOWARDS A FREE SOCIETY: An Introduction to Markets and the Political System by Gary Wolfram--------------"As Bastiat noted,however, being able to do something without coercion, that is without someone forcing you to do something else, does not mean all actions which you are free to do should meet with approval. Persons can be quite free to disapprove, morally, ethically, or for some other reason, with what you are doing. They are free to use the pressure of opinion in order to influence your behavior. They simply cannot threaten you with force.

This point is often missed in discussions regarding the consumption of illegal drugs. While you may feel that government should not be allowed to use its coercive force to preclude the use of crack cocaine, for example, you certainly may use your persuasion in order to convince persons not to use cocaine, or to not associate with those who do use cocaine. You may choose as an employer not to hire persons who fail a drug test. It may be your moral responsiblility to argue against the use of cocaine. The fact that you feel that the coercive force of government should not extend into the realm of limiting people's consumption of certain items does not mean that you must or do approve of their consumption of such items.

It is related to the idea that I mentioned earlier, should you be free to do whatever is not specifically precluded by law, or should everything be precluded except that which is delineated by the rulers. Clearly, in a society based upon the former proposition, an action which is legal is not necessarily an action which is morally correct or which is legitimate in the eyes of society. Restricting government to using the minimum of coercion that is necessary to prohibit coercion of individuals by other individuals, necessarily will allow a vast amount of activity which the average citizen would not condone. Legalization does not imply legitimization. Ignoring this precept has resulted in public policy towards a number of activities which fails to solve problems, and which unnecessarily expands the coercive power of government. The failed experience of Prohibition, where government's attempt to criminalize the drinking of alcohol resulted in turning the alcoholic beverage industry over to organinzed crime comes quickly to mind. The taxation of certain products, such as cigarettes and beer, serves primarily to add to the tax burden of the lower income. In many states gambling is not allowed unless the government has a monopoly over the game.

In each of these cases, those who feel the activity is not a legitimate one have used the coercive power of government to prevent people from acting as they otherwise would have. Failing in their attempt to persuade people that it is immoral or harmful to behave in such a way, or perhaps not even attempting this route, one group has used the power of government to force their views on others. While the view that one should not drink alcohol may be correct, it is up to those holding that view to persuade others to stop drinking. When coercion is used rather than persuasion, freedom is reduced and a precedent for further coercion is established." Questions: Is there a relationship between the degree of coercion used to try and improve social behavior and the degree of personal responsibility used for the same purpose? Is this relationship an example of a positive feedback loop (see Parker and Stacey)? (PD)

28 April 1999................regarding 26 April 1999

I think that as government has expanded in size and scope, people have found it easier to lobby the legislature or the Congress than to mount a campaign of persuasion. In some cases this surely has resulted in reliance on coercion rather than individual responsibility. An example would be charity. In the early stages of our Republic, people were expected to take the poor into their house, or at least into their confidence and provide direct assistance to the poor person, in spirit as well as body. Today, we rely on the government to coerce us into taking care of the less fortunate by seizing our property and distributing it through FEMA, Social Security, Medicare, welfare programs. As a consequence, the link between the poor and the better off has become broken and we no longer actually fulfill our responsibility as our brother's keeper.

In the same fashion, we don't try to assist a drug addict and convince them of the error of their ways and attempt to help them out of their troubles. We pay 40% of our income off to various levels of government and expect someone who is paid to help people to help them. In the end the less fortunate are isolated from the more fortunate and the less fortunate don't feel responsible for their situation but blame the fortunate or the system for their being poor or downtrodden. The fortunate wouldn't let a poor person or a drug addict into their house and if they did their neighbors would surely complain. (GW)