Another week, another twittering of Tweets and other connective coincidences of the … oh, whatever you want to call it. Usual categories, usual possibly-useful items, usual ‘Read more…’ link:
I fear I’ve overdone it this week – almost twice as many as usual. Still, that’s what I collected as the week’s Tweets and links, so here y’is, y’all. Usual categories, after the usual ‘Read more…’ link.
In part this is a follow-on from the previous post on the fundamental flaws underlying all forms of currency, but it also has many implications for businesses, enterprise-architectures, societal models, corporate social responsibility and much else besides.
And don’t worry, I’ll aim to keep this one short(ish) 
[later: turns out it's another long one - sorry...] – though I’ll probably return to the theme quite a bit in subsequent posts.
The key point in the previous post was that no ‘alternative-currency’ would solve the socioeconomic problems that we currently face: the all-too-evident failures and failings of the money-economy are merely at the symptom level, and attempting to replace conventional state-issued currency with some other kind of home-grown alternative would be merely one more variant on the theme of ’shifting deckchairs on the Titanic‘.
Yet clearly we do need something that will enable us to operate the kind of global-scale exchanges that our current economic models allow – because without that, it’s obvious that the city-based cultures especially could quickly collapse into anarchy of the worst possible kind.
It might perhaps be a surprise that what I’m suggesting here as an alternative actually is anarchy – but anarchy only in a strict technical sense, and of a radically different form.
Let me explain.
In the previous post I hope I made it clear that there is no way in which a possession-based economy can be made sustainable. Therein lies the real economic problem: possession is a classic example of the antipattern that “for every complex problem there’s a least one clear, easily-understood wrong answer”.
Underpinning that ‘wrong answer’ is another even deeper ‘wrong answer’: the notion of rights. Possession is defined as a right – the right to personal property, and so on. (In British law it’s more subtle again, in that it’s actually defined as a right to exclude others from access to resources that they may need: as the 18th-century jurist William Blackstone put it, “that “sole and despotic dominion which one man claims and exercises over the external things of the world, in total exclusion of the right of any other individual in the universe”.) But there’s a catch – a very important catch. To paraphrase Margaret Mead:
Rights are a social fiction; responsibilities are a social fact.
More to the point, it’s probable that responsibilities are the ’social fact’ – that the structure of a society is actually an emergent property that arises from the intermeshing of mutual responsibilities. A society – and hence that society’s economics – arise from those mutual responsibilities. A society’s economics represent its recognised means and controls via which its available resources are shared, exchanged and used – and those ‘means and controls’ are, in effect, defined and circumscribed by mutual responsibilities.
You might ask “So where do rights come into this?” But that’s the whole point: they don’t. Rights don’t even exist in any real sense: they’re just a convenient social fiction, useful for some circumstances – as we’ll see in a moment – but dangerously misleading in others. And economics and purported ‘rights of possession’ are a good example of where the rights-discourse is indeed dangerously misleading – as all of us are discovering right now…
Any competent observer of economics would acknowledge that the money-based model on which most current economics is based is in deep trouble right now: somewhere between seriously-dysfunctional and completely broken. Many of the purported key-metrics such as GDP and GNP don’t really tell us anything useful at all about the actual functioning of the economy: all they describe, really, is the potential tax-base, in monetary terms – and the distortions that this introduces into the economic picture are the direct cause of many economic problems. Banking and, especially, finance have moved so far from their functional roots that they’re now little more than engines for embezzlement on an almost unimaginable scale. And the preferred ’solution’ to the fact that many, many things cannot be meaningfully described in monetary terms is simply to declare that such things do not exist or, if they do, they cannot conceivably matter within the overall economy.
(I won’t give links for any of those assertions above: we’d be here all day. They’re all well-known and long-proven problems, as a few hours’ worth of careful web-searches will demonstrate all too clearly. Just take it as read for the moment that that’s so, because the details as such aren’t that relevant right here.)
Given that there’s a perceived problem with the ‘money-economy’, what can we do about it? Well, the usual ’solution’ – and I use that term advisedly – is to rush out and devise some form of alternative-currency. I’ve seen dozens of these so far, and apparently there are actually thousands of these projects, across a whole spectrum from simple barter to community-based currencies to time-based currencies. But they all have one thing in common: they won’t work.
Not just ‘won’t work’: they actually can’t work. They can’t solve the problems that we face.
No form of currency will satisfy all of the requirements for managing an economy, without requiring distortions to the economy itself that will render that economy non-viable or non-sustainable, especially over the longer term.
And there’s no way round that fact.
My apologies if that fact offends anyone, but it is indeed a fact. And refusing to face that fact is not going to help anyone. Sorry.
Been having a fairly intense (but good ) discussion on the LinkedIn Enterprise Architecture group, about standard economics and its impact on enterprise architecture. This is one of the many side-threads popping up off Kevin Smith’s now long-running discussion on “EA is not the glue between IT and ‘The Business’, EA is the glue between strategy and execution”. I don’t know whether this set of posts from various participants will make much sense to anyone else, but it seems worthwhile to post it where others can see it if they wish.
(Note that I’ve done a small amount of editing of the original posts by trimming and snipping ['...'] and, in one case, concatenating posts from the same person. I believe I’ve kept the sense intact in each case, but if not, please let me know straight away? Thanks.)
For me, in this case, the start-point was a post by Harold ‘Hal’ Stull:
When in doubt I always think Econ 101. An organization manages three resources (capital, labor, and material) to produce a product. If a customer pays more for the product more than the value of the resources consumed, the company shows a profit for its risk and will continue operating. As an architect of any kind, I have to discover the “Who, what, when, how, where, and why” of the client’s operation and add something that may possibly increase the perceived value of the product to his customer or reduce the resources needed to produce it.
I also try to stay away from absolutes: Truth, Best, Optimum, Consistent, etc. I can do a whole lot with organizational and interface symantics. I would never say “ontology” in front of a client, but being able to work with higher abstractions helps me choose and squeeze value from tool kits. (But I see there is another thread for that topic).
As you’d probably guess, given some of the other posts on this weblog (such as ‘Economics: the worst term-hijack ever?’), I kind of jumped at Hal’s comment about ”When in doubt I always think Econ 101.”:
Hmm. That assumes that ‘Econ 101′ makes sense and works in the real world, which it doesn’t. That’s the problem.
You say: “An organization manages three resources (capital, labor, and material) to produce a product.”
The answer would be “Sort-of…”. More accurately, Econ 101 treats all of those items (including non-financial capital, such as conceptual and/or social capital) as ‘possessable objects’ that are the ‘property’ or ‘possession’ of an individual or of an organisation-as-corporate-person. Unfortunately this would take a long post to explain, but in essence the ‘possession’-based concept of economics is a parasitic overlay on the actual economy, which operates on mutual-responsibility rather than possession. The quickest summary is that Econ 101 is inherently dysfunctional and inherently unsustainable: so if we’re to build an enterprise-architecture that will work for an organisation, we need to focus on the responsibility-based economy behind the possession-based delusions of Econ 101, and not allow ourselves to be distracted by those delusions.
To give one very quick example, most conventional ‘business-models’ that I’ve seen assume a very simple Econ 101 market-sequence of:
attention (via advertising) > transaction (via sales) > profit
For enterprise-architecture, we need to deal with a much broader range (e.g. including non-active stakeholders [e.g. government, community, non-clients] and also anti-clients and others who are active participants but who are not involved in sales-transactions), and a much more complex market-sequence, such as:
reputation > trust > respect > attention > conversation > relationship > transaction [ > profit] > reputation > …
We also need to understand that ‘the enterprise’ is not the same as ‘the organisation’: an organisation is bounded by rules, roles and responsibilities (e.g. legal responsibilities), whereas an enterprise is bounded by vision, values and commitments (see my presentation ‘What is an enterprise?‘)
True, an organisation is a type of enterprise, but for most enterprise-architecture the relevant enterprise is typically at least three steps larger in scope than that of the organisation in scope. (We develop an architecture about an enterprise for an organisation.)
Using the assumptions of Econ 101 will guarantee that we will deliver an ‘enterprise’-architecture that will fail in the longer term. To build an architecture that works, we must think wider than that.
Another week’s worth of Tweets and links – rather more than usual, this time. Same categories as usual, though, following the usual ‘More info…’ link:
A bit late again – got a bit distracted. Never mind, here’s another week’s-worth of Tweets and links, sorted into the usual categories, after the usual ‘Read more…’ link:
Another week’s collection of Tweets and links. Usual categories, mostly: share and enjoy?
Finally catching up again: last week’s collection of Tweets and links. Usual categories unless otherwise noted.