Throughout my active career in government, research, and in consulting, I encountered countless attempts at “transferring innovation.” Let me translate that into human. Somebody, somewhere, starts up a program—to help battered women, say, to reclaim drug addicts, to help troubled children. The program is a great success. It’s noticed. All kinds of savants descend on Mrs. Irma Innovation to find out how she does it. TV cameras arrive as well. Here’s a program that really works. Then begins the process of transfer. The savants believe that they have captured the essence of the program. It gets written down. Then, with the recipe in hand, attempts are made to “replicate” this innovation in other areas—to spread it from Spokane to the World, you might say. The transfer may be managed either by government or by foundations, but it has the same dreary pattern. For some mysterious reason, the innovation never takes root anywhere. The outer forms are replicated, but the whole thing eventually fizzes. The failure is usually blamed on lack of adequate funding.

Irma Innovation, to be sure, started with no funds at all, adequate or not. She just started doing things, roped in her friends. One thing led to another. The money magically materialized. Why then, with the fully-documented procedures known and start-up dollars available from the beginning, do the programs fail? The reason is that the savants managed to miss the one really important element in the innovation—or perhaps I’d better make that two. One was Irma herself. The other was that she was free—free to do things as she wished—limited only by her circumstances. But she managed to change those circumstances entirely by herself.

I’d explain all this by saying that we’re culturally conditioned to believe that procedures matter and that people don’t, that everything can be achieved if only we have the right “systems”—read procedures. It’s the procedures, stupid, not the people who’re hired to implement them. Here, of course, one current context is the failure of our “security system” to perform; and when it fails we immediately attempt to fix the system, usually by piling additional procedures on top of procedures—rather than asking if, perhaps, the whole approach is wrong.

More fundamentally, in all of our major collective efforts, be those in the private or the public sector, we attempt to mechanize decision making. That is what procedures are. This mechanization removes one of the elements that helped Irma succeed—the freedom to act as circumstances demanded. It also causes the likes of Irma to head for the nearest exit. Precisely that feeling of helplessness over against the stupid rigidity of process caused me to leave government—and other jobs as well.

Yet another way to put this is that collectives always favor top-down control over getting-the-job-done. If control is threatened, to hell with the job. The problem is less acute in the private sector where the feedback loop is short—but the bigger the corporation the more abuse is permitted and hence the more top-down control is enjoyed. This cultural bias, therefore, also hurts the private sector.

If we put individuals in charge and gave them genuine autonomy, we would greatly improve public programs of whatever kind. Abuses would then emerge in another guise—namely individual exploitation of the powers granted. But abuses are inevitable in any case. And, with individuals in charge, the feedback of failure would also be personal.

Part of our collective ailment comes from advanced communications, actually. The Romans perfected a system of governance based on personal delegation. We mostly hear of its abuses, but it worked rather well. They chose this path because distant servants of the realm simply couldn’t be micro-managed in an era without telephones, faxes, computers, airplanes, and worldwide webs.

Here and there managements are wise. I once worked for a splendid company where authority was genuinely vested in general managers. And we got things done. The problem was that our company became excessively cash-rich. We failed in frantic efforts to spend that cash on acquisitions and research fast enough. A hostile takeover followed to grab the money…

The Irma Innovations of the world, alas, rarely run for office. And the institutions they enter when they did so are deliberately designed to suppress innovation in favor of power-conservation. But you’ll find Irma, here and there, in local government—usually working for nothing, in her spare time…

My local paper announces in big black type today a “Decade in Review.” But the decade isn’t over yet, is it? Or is it? Calendars are arbitrary structures. The current calendrical era began in the year 1 AD, not 0 AD, hence the first century of the current era ended in 100, not in 99, and the first decade of that century ended in 10, not in 9 AD. The most authoritative source I can provide for this is the Royal Observatory in Greenwich here. The U.S. Naval Observatory helpfully agrees—but has more to say on the subject. If you want to read more, begin your perusal here.

As any weary history-buff can testify, centuries are named after their last year, not the numbers that appear in the 99 years that lead up to it. The fourteenth century? Bet on it that all but one of its years began with a 13. The twentieth? Yes, of course, with a 19. The last year of the current century will have—at last, at last—a real 21 in the date, but we’ll keep talking about the twenty-first for 90 years more.

I am here, of course, thrown back to my computer days and into a world where things began with zero—and then went upward from there. In binary math, only two numbers exist, and the first one is zero. You get used to it. But most editors and journalists are not computer hacks. Whence this love affair with zeroes? I’m also reminded of a much more damnably tough conceptual problem, namely the point and the line. Are lines really made of points? If yes, each point has to have a tiny little length—or no line could possibly be formed. But any something that has length is, well, a line. So what’s the point?

And that, of course, reminds me of Zeno’s paradox of motion, usually illustrated with the hare racing the tortoise. To get from A to B, the hare must first get halfway between the two, thus to A’. And then, again, halfway from A’ to B. But since these distances are infinitely divisible, the hare never actually gets there… Guardian knot. Enter practical man, Alexander, armed with the Arbitrary Sword. Centuries, decades start with 1. That’s it folks. Basta!

Brigitte annotates the New York Times in ballpoint this morning saying: “We’re plagued with ‘bad intelligence’ or a ‘lack of intelligence’ or ‘failure to integrate information’—of which there is too much. Information overload?” Her comment accompanied a story titled “He Sees a ‘Systemic Failure’ in Nation’s Security System” that ran yesterday. He is Obama. The issue, of course, is the attempt by a young Nigerian to blow up an aircraft on Christmas day.

Yes. Food for thought. It reminds me again that information isn’t knowledge, that knowledge always requires context, and that computers in the small and “systems” in the large don’t think. Only individual humans think. If the flow of bits of information overwhelms our powers thoughtfully to look at all of it—and from a steady single point of view, in the proper context—no “system,” meaning some combination of computers and people in interaction, will be able to catch every possible perpetrator.

Somewhere in the avalanche of news that has passed my eyes and ears since Abdulmutallab made smoke but was stopped before the fire started, I read the suggestion that “profiling” may produce a better approach to catching the odd trouble-maker. But we disdain profiling. Truth in that. Why? The place to stop these things is at the point where two humans interact, the place where the proper, specific context is sharply to the fore: at the airport, before boarding. Profiling, alas, means that lots and lots of totally innocent Arabs, Africans, and Hindus will be needlessly searched. But from a practical point of view, especially when all systems are No-Go, it certainly seems to be a better approach. And it will also, inevitably, let some people slip through the meshes. Our bodies are smarter. The antibodies in our blood are ruthless profilers and absolutely pounce on anything even remotely alien—even when it isn’t.*

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* An example is the Rh factor, one particular antigen on red blood cells. Most people have the so-called D antigen on their cells. They are Rh positive. Others are Rh negative in the language of science; the D antigen is absent. A mother’s body will build antibodies that attack her embryo when she lacks the Rh factor but the baby is Rh positive, a factor it inherits from the father. When this mismatch is present, the baby (or the mother) is in serious danger.

Can’t find that airline on the Internet? Just wait a while. As things now trend every airline will soon be “nudist airlines” because the only safe way to fly will be in the nude. To be sure, even in the nude, we may be subject to discreet searches of body cavities in little booths on the way to nudist runway. Where is that explosive? It’s in the mail, it’s in the bag, it’s in the shoe, it’s in the underpants. Mad Magazine has morphed into reality. I’ll bet money technicians are now hard at work on the explosive in the denture. “Please check your dentures with the attendant,” the nude passengers will be told. You want some nice reading material while on the airplane? Here comes Skin-Kindle, the temporary tattoo device. You can download that book right onto your thighs or, if you have the room for it, onto that spreading tire across your middle. We. Shall. Be. Safe. Count on it. Technology to the rescue. And think of the romances that might start aboard all those Nudist Flights… A bit hard on the aging, to be sure, but then, for a while, anyway, there will still be cars.

Yes, checking on the sun—again. Earlier postings on this subject are here and here. As most people know, the sun has 11-year cycles tracked by the number of sunspots that appear on its face. Sunspots are common throughout most of the cycle. At intervals of eleven years, sunspots thin out and then disappear. These periods—they usually last more than a year—are known as solar minima whereas periods when spot-formation is at its height are known as solar maxima. We are now in a period of Solar Minimum but, as it happens, one of the longest in duration. In 2008, the sun had spotless days on 266 of 366 days (73% of the time). But, surprisingly—because this minimum should now be ending—in 2009 we have observed an even more intense period of solar silence, so to say: 87 percent of days this year have featured a blank sun. The typical Solar Minimum is 485. As of December 9, 2009, we have clocked 771 blank days. The daily report is here, and more on this subject is available here, including a chart that shows that 2008 has been exceeded only once in the last century—in 1913.

In its story on the passage of the health care bill the Senate passed last night, the New York Times sums up one of the bill’s consequences in these word:

The budget office estimates that the bill would provide coverage to 31 million uninsured people, but still leave 23 million uninsured in 2019. One-third of those remaining uninsured would be illegal immigrants.

That paragraph leaves two-third of the uninsured “residue” undefined. I thought I would try to find out who they are. That took a while. The source of these numbers is a table contained within a letter sent by Douglas W. Elmendorf, Director of the Congressional Budget Office, to Senate Majority Leader Reid on December 19, 2009. The letter is available here. To find the data immediately, search within the PDF for the phrase “Table 4”; the actual table will appear on the fifth click.  

What Table 4 shows is that the CBO has conducted estimates of the likely coverage of the population in the period 2010 through 2019, year by year, first projecting what would happen under current law and the changes produced by the bill. The graphic summarizes selected elements from the table. Blue is the projected future without the bill, green is the bill’s effect, red is the problem left unresolved.

Based on these figures, the uninsured non-elderly (the elderly are covered by Medicare) will be 50 million in 2010 (up from 47 million in 2006 as reported in an earlier post). Without any changes in law, the uninsured in 2019 will be 54 million. In that year the net effect of the bill will have been a reduction of this number to 23 million (red bar on  the graph).

The big changes in 2019 will be the result of (1) increased numbers of people covered by existing Medicaid and CHIP (Children’s Health Insurance Program), removing 15 million from the uninsured pool and (2) the effect of new Exchanges, permitting individuals not heretofore covered to purchase insurance; this removes an additional 26 million from the pool. These two numbers add up to 41 million. But this improvement in 2019 is offset by 10 million people losing employer-provided and “nongroup and other insurance”; what population this last category consists of is difficult to ferret out. I gave up. But the net effect here is a reduction in the number uninsured by 31 million, leaving 23 million still without insurance. Those studying the actual table will notice that the numbers are off by a million, undoubtedly due to a rounding error.

So who are the “left out people”? The CBO provides us with two categories only. These are (1) illegal immigrants, supposedly one third of the total (around 7.7 million) and (2) 15.3 million people who are “eligible for, but not enrolled in, Medicaid.” The last and largest group is thus the miserably poor and the hopelessly disorganized—those who cannot grasp a value they are entitled to have. Why? They lack knowledge and/or initiative. Why did it take me such a lot of effort to find this out? Because most journalists don’t bother studying the footnotes to tables. They take their stories from summaries on the first page of letters.

Another striking aspect of this table is the snail-like speed with which we actually reach 23 million still uninsured. Reductions in the pool of the uninsured move at the following rate: 2010 – none; 2011 – 1 mil., 2012 – 1 mil., 2013 – 1 mil., 2014 – 16 mil. (at last!), 2015 – 23 mil., 2016 – 29 mil., 2017 – 30 mil., 2018 – 30 mil. (no change), 2019 – 31 mil. As we march out in time, we can also imagine other administrations taking hold, the makeup of the Congress changing, and therefore the uneasy feeling that none of this is reliably even a vague picture of the actual future.

It is also instructive to read the text of the letter itself, at least in part. It reveals the Rube Goldberg device that this bill really is, the large number of weird arrangements it contains, the vast administrative effort that it implies, the lawsuits it will no doubt engender, and the opportunities for hype, propaganda, and misdirection it creates. Business as usual? Well, there are positive features here as well, but difficult to disentangle. When you drop your jelly-covered slice of bread face down at the beach, there is still food there too.

The nineteenth century certainly, and part of the twentieth as well, was the time of Blake’s Satanic Mills, the early period of industrial civilization. A quite excellent documentary on this subject, centered on the Great Lakes, was broadcast on our PBS station here entitled Freshwater Seas: The Great Lakes. The documentary was sponsored by the Great Lakes Fishery Trust, the Great Lakes Alliance of Caterpillar Dealers, and the Wege Foundation. At least one hour of this two-hour documentary can be viewed here, the second hour here.  I hope that these postings will be kept up for a long time.

It is genuinely fascinating to see the Great Lakes region first denuded of its forests and overcast with smoke, transformed from an idyllic landscape into the factory of war, the water ruined by sewage, run-off, and nasty invaders from the great Atlantic. And then watch as, through great public effort and determination (and expenditure)—virtually unnoted by the public and certainly not celebrated like the ruinous heroes of Wall Street—the Great Lakes were then once more rendered into the greatest sweet-water resource on the face of the globe. The Satanic Mills? They are no more. Much, much work remains to be done, but it looks like, in due time, the status quo ante will be at least approximated in the future.

The story is sober and factual. There is neither whining in it nor yet propaganda, no name-calling and no boasting. Something rather rate. No punches are pulled, either. And no rears are kissed. I wish they would put the film out on diskette so that I could recommend a purchase. Maybe in the future. I’ll keep tabs on this.

In a time when the collective train is adding steam as it rushes toward the abyss unaware that the bridge has been swept away—and it’s a dark, foggy night—it is reassuring to see any evidence at all that something is being done right, however quietly. It might be possible that we shall even get that train to stop… Nothing would please me more than a gradual, conscious, and deliberate transition to the post-petroleum age that approaches us out of the future.

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Photo courtesy of the documentary’s site.

Throughout the vast reach of history, up to industrial times, economies were influenced by weather, climate, and periodic devastating plagues. Life was based on agriculture—if we understand that word to include the raising and tending of livestock. Some communities also greatly depended on fishing. The climate and weather were forces beyond control; and so were plagues. Wars were another source of collective trauma. I’ll come back to that.

Since the age of fossil fuels dawned, modern economies have come to be based at bottom on energy and, above that fundamental level, on technology. Thanks to both we have been able to control seasonal and climate-related factors in agriculture much better by irrigation, fertilizers, and pesticides. But then there is a third layer above energy and technology. I will call it Ideology because it rests on ideas: how economies ought to be organized. Our own domestic economy—and much of the world’s as well—is based on the concept of free markets. What is to be made and sold is left to the collective decision of individual entrepreneurs. In theory all goes well because the sum total of myriad decisions, arrived at by a kind of auction, will produce ideal results. But if that is so, why do we have recessions? And why do recessions, sometimes, deepen into depressions?

The plain answer is that the Free Market does not produce the rational outcomes our simplistic model—based on a sober auction by well-informed buyers and sellers—suggests. If only it were so! The Free Market concept is an idealistic projection which ignores what Christianity called Original Sin. The feedback system—again modeled on an overly simplified notion of the village market where individuals have maximum information—is nowhere near as good as it should be. Vast stretches of the economy are invisible to buyers and even sellers. How many of those who own hedge funds could explain them? And how many of those who obtained subprime mortgages understood the implications of their acts? And did those who designed such things always act soberly? Was the consequence visible—as is the consequence of buying fish that already smell quite bad?

Free Markets are shaped by more than auctions knowledgeable people attend. They are subject to excessive enthusiasms, vaulting greed, and unjustified pessimism. Huge geysers of expansion lure in the greedy, tempt to abuses. When these collapse and unreal fortunes turn into worthless paper, the disillusionment of masses drags the economy into unnecessary depths. We make our own weather. We form our own climates.

There is another factor at play in all this. As I pointed out in the last post, private expenditures accounted for 70.1 percent of Gross Domestic Product; only 20 percent for government (read public) expenditures. As anyone engaged in selling knows, it is easier to sell to the public than to institutions. The latter always drive tougher bargains, are resistant to emotional appeals, and examine the quality of goods and services much more closely. The Free Market, therefore, produces a bias toward the private buyer. Private consumption will always be higher than institutional, to be sure, for the simple reason that the private is the biggest buyer. But must it be 70 percent? Why not the lower 60s?

My point, to make it clearer, is that the ideology of the Free Market, if sensibly modified by thoughtful public intervention, could possibly control some element of the human “weather” that now plagues us at quite regular intervals. But that prospect is dubious—at least until we’re really in deep trouble. Our very organization of the political sector—that which produces the potential for “public intervention”—is itself based on the Free Market ideology, namely (purportedly) representative democracy. Here the product is the candidate who offers him- or herself to an auction by an electorate. In theory that electorate is sober and well-informed. And the result, such as it is, is our daily experience.

War has always been, at least in theory, within human control. In fact it seems to be beyond control—much like that other face of the human climate, the economy. The implications of these facts before us lead to deeper considerations of what human life is all about. Not all is lost, by any means, but the best advice we have on that subject, capable of being compressed into three words, is St. Benedict’s: Ora et labora.  In English we can do that in three syllables: Pray and work.

To enrich my own understanding of down-trending expenditures December to December, the subject of the last post, I thought I’d check back with my favorite statistical agency, the Bureau of Economic Analysis, and look at personal consumption over a 60-year period, 1947 to 2008. The following graphic shows us Personal Expenditures in Total, together with its three major subcomponents, Durable and Non-Durable goods and Services. The data are rendered as percent of Gross Domestic Product.

Interesting chart. First of all, Total Expenditures dropped from a 1947 level of 66.4 percent of GDP to a lower level, bottoming out at 61.0 percent in 1967. Then they increased gradually to end up as 70.1 percent of GDP. Personal consumption thus gained share. What about other major sectors not shown on the chart?

• Domestic Investment was 14.3 percent in 1947 and 14.8 percent in 2008. A slight Gainer!
• Net Exports of goods and services was 4.4 percent (1947) and -4.9 (2008). A genuine Looser!
• Government expenditures and investments stood at 14.9 (1947) and 20 percent of GDP (2008). A Gainer!

The big share-gainer was government. You might think that war is the explanation, but no. The Federal sector actually lost share. The gain in government was largely at the state and local level. One thinks of Medicaid and other burdens the Feds have transferred to the states. The big loser was our performance in international trade; here oil imports and the expatriation of manufacturing jobs are the notable achievements.

The data I used are accessible here.

But let’s now turn to our chart. The striking curve here is the rise of Services from a 1947 percentage of 25.6 percent of GDP to 46.6 percent in 2008. This is the largest gain recorded for any element in the mix, although this one falls under Personal Consumption Expenditures, where the total is balanced by a drop in spending on goods; expenditures on durable as well as non-durable goods declined in share. The growth in the share of Personal Expenditures was thus entirely due to growth of Services.

Not the computer, friends—Internet Services. Not the TV, neighbors—cable charges. Not the cell-phone, kids—the cell-phone services. And so on.

Now with products dropping as a share of personal expenditures—on durables or not—is it any surprise that Christmas shopping—which is for physical goodies—has been trending down? People are shifting their expenditures to services. And what with all those endless subscriptions to support, there is less money for gifts. Here $9.95 a month for this, there $15.16 a month for that—and it sort of gnaws away the surplus.… It’s a theory, anyway.

Today I wrote a post elsewhere suggesting that, perhaps, the commercialization of Christmas is gradually lessening—for a variety of reasons, not least that people are getting weary of hustling like demons all through late November, never slacking until it’s Christmas eve. In my family we started easing off a good thirty years ago, and in our circle of friends lots of people have done the same thing. After I got done I started wondering. Is there a way of looking at this subject through statistics?

It occurred to me that total retail sales in December, but excluding food services, might give some indication. I went in search of the data and found the figures here courtesy of the Census Bureau. The graphic shows the results.

The data graphed show changes in total retail sales, December to December, from 1992 through 2008, in percent. Data for 2009 are, obviously, still being built in the stores. Since we begin in 1992, the change in that year is zero, but for all other years, a change from the previous December is shown. To this I have added a trend like, courtesy of Microsoft Excel. Let me emphasize the last point. I didn’t impose that trend; it is the mathematically calculated result inherent in the data. The interesting conclusion is that growth in retail December to December is definitely trending down. I wondered what the trend would be if the dramatic 2008 down-turn was omitted. Still down—but not as steeply. In this entire 16-year period, we have never had an instance of negative growth until 2008—but the 2008 result followed steady shrinkage of growth beginning in 2005—and what I was recalling, as I wrote the other post, was the  Retail Sector’s groaning and moaning, year after year, that sales were tanking.

Maybe we are getting with the program: Christmas is a religious holiday, not a patriotic one. It is patriotic, in a way, to shop until we drop, but, face it. It’s high time we gave this whole frenetic culture of consumption a serious re-think.