The Digital Age is upon us

I want to showcase three writers whose work intersects with this content and helps us think   differently. The common theme within all their writing is the presumption that the economic framework, morality, and organizations of our world are not scaling well to a new digital age.

Eli Pariser is the chief executive of Upworthy. He was also on the board of MoveOn.Org.  In his book, the Filter Bubble,  he examines how the internet is filtering out what we want to see and what we don’t want to see.  That is concerning as allows many of us to filter out views that are counter to our own. This can be very dangerous in a democracy.

Then there is Don Tapscott, who wrote, “Grown up Digital” and “Macrowikinomics”

Tapscott suggests that we really need to develop new frameworks and paradigms.

Here is a quote from a Forbes interview that he gave, “In one sense, the Internet is like the discovery of the printing press, only it’s very different. The printing press gave us access to recorded knowledge. The Internet gives us access not just to knowledge but to the intelligence contained in people’s crania, access to the intelligence of people on a global basis. This is not an information age. It’s an age of communication, of collective intelligence, of major collaboration, of major participation.”

And finally, Michael Sandel is a a writer for Atlantic and his book "What Money Can't Buy: The Moral Limits of Markets," is an examination of how market based thinking so completely dominates that we assume we can “buy anything”. But we all know that you can’t buy love.  You can however, pay someone to stand in line for you and sell advertising space on your body if you live in Japan.  In the "Case Against Perfection," he continues this line of thought by pointing out that our morality is not evolving at the same pace as our technology.

 

Down the Up Escalator

In her book, "Down the Up Escalator," Barbara Garson chronicles real life stories from the recent "Great Recession" showing us the personal pain and loss that so many ordinary Americans experienced. She interviews a group that she called the "Pink Slip Club" where no one's life has returned to normal after being laid off from their modest but solid middle class jobs. She looks at workers in retail sales and highlights how this once secure service sector job has now become part time work without benefits. 

She tells the story of many faced with losing their homes from the mortgage crisis. In many cases, we see individuals who made bad choices to refinance at the wrong time or buy up in a speculative manner only to end up losing it all. One point she makes is that many solid citizens who once would have thought it unthinkable to walk away from debt did just that and walked away from their homes and mortgages. I can't say that this all has a distant ring for me. Some of my own friends at work were laid off during this time and I know that they often dug themselves into a deep hole by living on credit cards and dipping into retirement accounts. Even once they found a new job, their salaries never met what they once had. And my own next door neighbors, going through a divorce, found a short sale on their house to be the best solution when they found that they had refinanced one too many times and now owed more than the house was worth. 

While the book is full of individual stories, her real focus is on the cause and consequences of this long period of history where wages have not come even close to keeping pace with productivity. This has been a time where the wealth in America has gradually transferred to the hands of fewer and fewer. From the dot com bubble to the real estate bubble, it is always the average American that comes out on the losing end because they simply do not have the access or the means to weather these storms.

She ends her book with a few profound thoughts. First, she acknowledges that this is not like the Great Depression. These folks are not hungry and by in large not homeless. But they are not sure if they will ever work again and have lost any sense of security around home ownership and retirement. Planning for their own future has become day to day. We as human beings do not like uncertainty and yet we have allowed an economic system to dominate where safety nets are considered a sign of weakness.

Malcolm Gladwell

Just finished my second Malcolm Gladwell book. The "Tipping Point" triggered my thoughts around what the country would look like when marriage equality hit the "tipping point" and fortunately, we just saw that happen in 2013.
The one I just finished, "What the Dog Saw" is a collection of his writings in the New Yorker. The only one I did not enjoy was on Ron Popeil, the kitchen gadget guy. But the rest of the collection will really inspire you to look at things in a different way and that is really what this blog is all about. How can we face all the challenges we find in our world and cast them in a new light?

One of the most interesting pieces was on the Enron scandal. He points out that while we think things like that happen because of secret accounting practices that hid the problems. The truth is that they were not secret at all and it was all out there for anyone to see. But it was so completely complex and convoluted that no one was able to easily draw out what was going on. So while we definitely need oversight, it is also imperative that those overseeing the accounting need to have the skills and knowledge to understand what they are seeing.

More Economics

When trying to solve big problems, it is important to know that the "conventional wisdom" that so many believe is truly accurate. I would suggest that two things that so many people think are true are not true.
First, one might assume that the way for a country to get out of debt would be to decrease spending. But governments are not households and some of the spending can be directed towards investing in its people.
 
US productivity has doubled since 1971 but real wages have not kept up. Health care costs aside, wages actually only went up by 4%. So while not everyone is more productive, many of those who work in the service industry are truly the support personnel for those who are. The statistics clearly show that a small % are profiting from this increased productivity while arguing against a raise in the minimum wage. We buy that argument because again conventional wisdom suggests that doing so will kill jobs but is that true?

The book, "Rich Dad, Poor Dad" is the classic conservative capitalistic mantra. People do not have money because no on has taught them how to have money.

The book makes several key points and I do not disagree completely with any of them. I just don't think it is quite that simple. First, it says that you need to think of assets and liabilities and the most controversial concept is remembering that your house if not an asset. While that may be true, unless you want to be homeless, some type of housing is necessary. If you take that point to avoid buying up and living beyond your means, then it is probably a positive message. But having a home and eventually getting to the point where you don't have house payments or rent is not a bad thing.

I do agree that more education on how to invest in the stock market is called for in a world where pensions don't exist and you have to depend on your  401K and Roth investments to retire. This is the part I find interesting. Not everyone wants to understand the financial markets and investing to such an extent that our new world order requires. What is wrong with a day where people just want to work hard and be rewarded for that intention. Why does everyone have to become the person described in this book. What exactly should we expect from a just society?

But this point is made and it is hard to disagree.
"Our current education system has not been able to keep pace with the global and technological  changes in the world today. We must teach our young people the skills, both scholastic and financial, that they will need not only to survive, but to flourish."  While some people can read this book and become inspired to turn the corner financially, it is just not for everyone and we cannot leave those people behind.

Half the Sky

To continue with my theme around international poverty and what does make a difference, I just read one of the most difficult books I have ever read. "Half the Sky" by Nicholas Kristof and Sheryl Wudunn tells the story of perhaps 1 billion women living on our planet today. While I have read unimaginable horrors described in history books that chronicle the stories of slavery or the Holocaust, I always knew that it happened in the past. But as I read this one, I had to confront the reality that this is today and these women were suffering while I read this book. It ended with hope and throughout the book, there were many glimmers of goodness and change. I will try to summarize the bad and the good of these stories and will start with one key theme. While we in the privileged West want to make a difference, it has to be done on their terms, not our terms.

Some of the topics covered include women in slavery, sex trafficking  women suffering unspeakable agony from childbirth, often giving birth when their bodies are too young to be ready. Women routinely beaten, tortured, isolated, and quite frankly treated as property. But there are also many impoverished women who have found ways to become educated, return to their homes and make a difference. The most hopeful aspect of the book is the idea that educated women will change the world.

Unfortunately, many government based aid efforts tend to ignore the fact that allowing half the population of any struggling country to be an untapped resource is dooming that country to fail. And some of the answers are so simple. A South African study found that giving girls a $6 uniform every 18 months increased the chances of them staying in school and decreased the chances of becoming pregnant. According to authors, it is clear that countries that are experiencing the most economic growth are those that have educated girls. While we shudder at what the "one child policy" has done in China, on the flip side Chinese women are far ahead of where they once were. Another thing that was hard to understand but is reality, in China and potentially elsewhere, the sweatshops are good for women. Because they excel at the factory work that has become so prevalent, making clothing and shoes, it provides an entry point for women to make their own money.

I think I can best sum up the book with this quote from the book, "Girls in Poor Countries are particularly undernourished, physically and intellectually. If we educate and feed these girls and give them employment opportunities  the the world as a whole will gain a whole new infusion of human intelligence-and poor countries will garner citizen leaders who are better equipped to address those countries' challenges."

It also gives hope that comes in some unexpected ways. It seems that access to television and watching soap operas did more to change the viewpoints of impoverished Indian women than any education program ever did. These rural women in India seeing their middle class counterpoints having jobs, coming and going freely without asking permission from their husbands empowered them to see that the modern way is to be treated as human.

And one of the easiest solutions is to be sure that all salt is iodized. Low iodine contributes to lower IQs for all newborns and changing that is inexpensive and can make a world of difference.

So as such a book should, it does end with ways we can help. It lists a number of great organizations. One that I am already into a lot is Heifer International. The book's appendix contains many other organizations and ends with the following :

Four steps you can take in the next 10 minutes:

1. Go to Global Giving or Kiva Micro Loans and open an account. Both sites are         People to People and link you directly to individuals overseas.

2. Sponsor a girl or woman through Women for Women International

3. Sign up for e-mail updates on Women's News and find out what is going on that     affects women.

4. Join the CARE Action network and I will add my own 5th one that affects the     LGBT community worldwide which is IGLHRC.

Super Freakonomics

The book "Superfreakonomics" is not about traditional macro-economics but actually more of an exploration of human motivations relating to money and micro-economics. It is also about proving theories and gauging human behavior based on the scientific method. The premise of this book is that we often believe ideas that do not bear out statistically. Their first book was quite controversial as it suggested that when the Roe v Wade ruling came down, there was a drop in crime in subsequent years. They suggested that was because many future criminals were no longer being born.

This book was equally controversial. There were several interesting chapters about prostitution and the debunking of the mythology around the 1964 Kitty Genovese murder. But the really interesting ideas covered in this book relate to global warming. They were not suggesting that global warming is not real nor that is is not that man-made. Instead, they pointed to an innovation group that is led by Nathan Myhrvold, the former chief technology officer at Microsoft.  

This group, "Intellectual Ventures" is proposing some very inexpensive solutions to solve global warming and the point of the book is that sometimes sacrifice is not the only answer. They suggest that if we implement the Al Gore proposals to lower carbon emissions, it will negatively impact those billions of our fellow world citizens who are just now climbing out of poverty. But instead, there are these relatively inexpensive ideas we could try. It is an interesting point but in either case, we will at some point run out of carbon based energy.

I always notice when I read these types of books, which really are the inspiration for this blog, that even if the topics seem completely un-related, there is always some recurring theme that emerges. One of those themes is that when facing complex problems as our planetary population is currently facing, we have to make sure our beliefs about how to solve them are grounded in truth. One of the memes that was in the Watchmen's Rattle post was "Counterfeit correlation"  

 

The other emerging truth is that there is often a simpler solution that will emerge at some point and thus, optimism is called for. That solution can come suddenly and become a complete game changer in a fairly short span of time. We can all hope that is the case when it comes to the major challenges we are facing, climate change, poverty, inequality, and injustice.

Why isn't foreign aid more effective?

In his book, "The White Man's Burden", William Easterly expounds on why he believes all of the efforts to fight poverty have failed and in some cases done more harm than good. How does it hurt? He says by empowering the systems that funnel the aid and find it in their best interest to maintain the status quo.
He believes there are "planners", which is the Jeffrey Sach's approach and "searchers" which is the approach that he advocates. He believes that in our effort to help and over plan, we try to force others to become what we want them to be. He even goes so far as to say that this is really just another form of western imperialism. He believes that instead of focusing on eradicating poverty, we should focus on what foreign aid can do for poor people. He does not believe in doing nothing but has a radically different approach. 

Searchers look for any opportunity to relieve suffering and don't get stuck on what he calls "infeasible objectives".  He believes in operating without goals and more accountability for those that are trying to help.

There is yet another perspective in the book "A Radical Rethinking of the Way to Fight Global Poverty". You can read more on the website  Poor Economics which includes a link of ways you can help by funding microfinance projects which do seem to make a lot of sense.