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Getting the incentives right requires redefining the units of measure

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This is a post for the UN’s Open Working Group on Sustainable Development Goals “Informal meeting on measuring progress” on the new science needed for achieving the SDG’s, “getting the incentives right” as many observers have noted as essential.   In part, it requires “New Units of Measure”   because there is “Something Very Wrong with our way of measuring impacts”

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The Need to redefine our Units for Measure and how to begin

Getting the incentives right:

To be effective in getting the results we want, we need to get the incentives right, a matter of understanding both how people make decisions and how the economic system works and would respond.   That involves knowing how to measure what decision makers want to know about.  For investment decisions, for changing how we use the earth one thing they’d want to know is their possible future liabilities for making the wrong decisions. That illusive goal is now much  closer to being solved, with this major improvement in the measure of the impacts of businesses.  The traditional way to measure impacts was to count up what you could trace, and this study showed that what we can trace is most often only a small part, basically because what was being left out was the impacts on the environment caused by the resource demands resulting from the revenue businesses generate as their main purpose, having to date only been counting the impacts of intended operations.   This discusses a comprehensive approach to quantifying them.    JLH

Statement to OWG 6:

Prepared statement For 9:00 AM Major Group Meeting of 12/12/13 on Means of implementation (science and technology, knowledge-sharing and capacity building)  —  “The mismatch between measured impacts and responsibilities”.    Also delivered from the floor at OWG-6.1 the Informal Meeting on Measuring Progress” on Tuesday 12/17/13

Statement: Because sustainability metrics for businesses are just for the impacts of business operating technology, the environmental impacts of the people who operate the business, their employees and those of all the kinds of service providers businesses use to operate, don’t get counted.   Businesses and economists, thinking of money systems not environmental ones, may not see a reason to treat businesses as physical systems and count all their impacts, but you know for sure nature does.   So it’s very common for businesses and consumers to actually be directly responsible for much larger scale environmental impacts than they are told.    Of course the reason we’re measuring impact is for steering a redesign of our economy for the future of the earth, and it would actually be better to get it right.   Using metrics very often in error by 80% or more is really unacceptable as it voids the purpose of measurement in general, but you talk to people and they don’t want to change, sometimes mentioning the inconvenience.    Don’t you think we’d do better to think of the “inconvenience” to the investors who have been trusting us, who we are presently giving false guidance to for what to invest in? Continue reading Getting the incentives right requires redefining the units of measure →

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Ideal Model: New Architecture for Economic Self-Governance

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Prepared for UN Open Working Group on SDG’s, OWG-5, 6 in Dec 2013 Owg 7,8 in Jan & Feb 2014, solving the special “steering problems” raised there as well with: 

 This is a serious effort to describe in natural language a well thought out way for a market economy to follow organic systems principles, and decouple from conquering the earth to reorient its development toward finding its secure place on earth.   It would be driven by our goal seeking social and economic communities developing new markets and partnerships for mutual benefit as markets always serve to steer the economy, but having much better information on what’s profitable, and recognizing the true cost of inaction.   As we find how to do it the economy would also  change from building itself up internally to making itself at home externally.  

By redirecting our resources from pressing ever harder on the limits of the earth, and instead aim for relieving the strain on ourselves and the earth, the economy would become relatively more profitable than before as it heals.   A great many of the key goals of sustainability (SDG’s) being stated again and again at the UN, would be achieved naturally this way.    Other critical goals would still take concerted planning and government action, but would become more practical to accomplish.

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Incentives to Sustainably Lower Our Global Footprint 

  • Holistic and accurate measures of  ESG costs of production and consumption
  • An Information System Everyone can understand, for a Self-managing World 
  • Turning the economic pursuit from “conquest” to “homemaking”
  • “Nature’s Capitalism”, first profiting from building things, then by caring for them

Steering Capitalism with a purpose: giving us a good home on Earth

A.            The idea

The natural way economies determine their futures is by “market choices”, as financial, business and consumer markets look for how to get what they want from each other and the earth. Then governments, the press, professions and open societies watch out for the common interest.   That’s what designs of the economy of our future, telling developers what new parts to add or old ones replace.

Those market choices often don’t reflect common interests just for our natural lack of information.  What was done around the world to deliver goods or services is not collected and passed along as they are paid for,   What’s becoming possible is like that, ways to identify future societal costs that business may be held responsible for in the future, practices like adding to global inequities or harming our economic future.

Comparing comprehensive sustainability balance sheets, for finding development proposals with financially and culturally acceptable risks and benefits. Global benefits/People centered, Homemaking

Just one new fact about money can release a great wealth of information on that.  It’s that the “hidden consequences” of using money we don’t immediately see have been scientifically shown to most often be close to “average”[1].  In information terms, that serves to “internalize all externalities”, opening the door to what has eluded us, a way to make sound decisions for the world as a whole.

It would let us build an information system making the choices responsible for impacts transparent for all to see.  For example, spending one dollar generally adds about 1 pound of CO2 to the atmosphere.  We might select the least cost engineering option for ending our addition of CO2 to the atmosphere as a standard measure, possibly bio-char, estimated to cost $.20 per pound of CO2.  That would be equal to an impressive “tax” on GDP, of $.20/$1, an indicator of how poorly the earth’s profits are being used.

People would then clearly see, for example, that as we build more and more for the future economy to take care of, a natural turning point approaches for investors and everyone else, of diminishing total returns.  So as growth becomes seen as a drain on future profits, the most profitable use of profits becomes caring for the environments creating the profits, not compounding our demands on them.

[1]Henshaw, J. 2011 Systems Energy Assessment. Sustainability MDPI. http://synapse9.com/SEA – People are “end users” of the consumption economy AND “end servers” of the production economy.  The “end producers” for any dollar of goods or services are SO wide spread one must first assume, every dollar is distributed as an average share of GDP and reflects the average impacts of the whole, good and bad.

Continue reading Ideal Model: New Architecture for Economic Self-Governance →

Mail & Comment, Natural Economy, Natural systems, Policy discussion, What to do

UN OWG-5 statements – SDG’s missing some signals

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Last week was unusually successful for me at the UN, or felt that way.   The increasing openness of the process, and my good luck in finding socially acceptable ways to stay it, both helped me.  So I was able to bring small flashes of light to the deeper kinds of issues about “What to Do with the Earth” that the UN is continuing to expand it’s discussion of,..

toward defining the world’s “Sustainable Development Goals”  

It’s really an amazingly broad discussion of every aspect of how the “world we want” should work, a truly impressive effort, well, of course still leaving out the things that we are culturally blind to and at the same time feverishly looking for to save our necks in a terrible situation     Here are three of my statements for OWG-5, and capsule assessment of the UN’s Technical Support Team briefs for OWG-6 for framing everyones terms of discussion for the issues.

Yes, but can we REALLY now have energy and equity for all?
  1. Macroeconomics – of ever increasing inequity
  2. More Energy – for ever growing demand
  3. Mismatched measure – impacts missing from responsibilities
  4. Using the economy’s own steering not mentioned

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1.  OWG5 Scheduled 11/25 intervention Macroeconomic Policy  (circulated) 

Promoting growth at the limits creates severe increasing, not decreasing, inequities

The great variety of urgent SDG’s being discussed are truly desirable, but can only be somehow addresses together.

Monday morning Bernbadette Fischler offered a model that seems consistent with cost estimates for doing all this, that the SDG’s might for a period cost 2% of the income of the over developed economies to kick start the growth of the underdeveloped economies.

Say that worked. We’d then have 100% of world population using modern technology, adding their earnings to their investments to drive more growth, and so ever increasing competition over the earth’s shrinking resources too, adding even more strain on both people and planetary boundaries. Continue reading UN OWG-5 statements – SDG’s missing some signals →

Mail & Comment, Natural systems, Scientific theory

Natural Systems.. meet many worlds of Cultural Reality

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I got a strong “like” from Mark Stahlman to my comment on Real-World Economic Review – issue no. 65. that led to A great longer discussion on the Cultural Anthropology of Knowledge on Open Anthropology .   We start a series of excerpts, mostly my writings, with my comment to the economics review journal.    J.L. Henshaw (@shoudaknown) commented in response to Edward Fullbrook’s “New Paradigm Economics” :

Culture was always what defined our realities, till we had to deal with multiple cultures, and found our selves confused.

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1. JLH Comment to Ed Fullerbrook 10/6/13: – 

A Solution that leaves out much of the problem

Edward, Regarding your new paradigm. I’m a natural systems scientist who has spent a lot of time on the puzzle of how economics became so detached…

I certainly applaud your effort to describe a new paradigm for economics, and see your approach as having the right intent and to be quite elegant in how you construct it. It still overlooks why natural systems will invariably depart from even the most faithful effort to describe them mathematically.

It’s that 1) natural systems change how they’re organized, and so how they behave, ALL the time, 2) all natural systems originate from a growth process in which they change how they work ever faster, to then change form, and 3) by ignoring #2 the present paradigm is to manage a world of systems that all expand and become ever more unmanageable over time.   It’s “impractical”.

What I think this exposes is a very basic flaw in our conception of nature. It seem to be coming directly from our attempts to define nature conceptually (treating nature as rules that we control), rather than using the rules we find to help us learn about it. What we have is an ever changing world, full of complex living natural and cultural systems we need to interact with, that are inventing new behavior all the time and fundamentally out of our control. From there I’m not sure what would help you understand my approach, as my terminology is likely to ‘sound funny’.

Continue reading Natural Systems.. meet many worlds of Cultural Reality →

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Nature’s Capitalism: “Homemaking” now, not competition over shrinking pies!

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This post is for the UN’s OWG 5 proceedings next week, on Post2015 Macro Economic development positions.  It led to the OWG 8 proposal “A World SDG“, introducing an integrated true scientific measure of sustainability... It’s now followed with “The Decoupling Puzzle – a partial answer” , on measuring our “decoupling rate”, and the development space reserved  within planetary boundaries, such as for achieving world cultural wellbeing!

Sadly, as careful as I am with the language, there is some scientific thinking… so the social organizations generally found no way to engage in discussing it.   The basic principle is that “when you build something you then need to take care of it”… something everyone knows in their personal lives.  That runs into the problem that, culturally, we don’t see economic growth as “building something”.  We see it culturally as a “constant” of prosperity… the ultimate tragedy of our times. that ever faster change is seen as “constant” it seems. 4/21/14 jlh

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As a young systems scientist many years ago

I noticed a need for a better type of economic model,

that would connect money to its “externalities” in part.  More importantly it would let people see economies as the complex living organisms they really are.  What I found was the universal stages of natural development, that are repeated in the way any natural event or system develops from small beginnings to multiply at first, and then by multiplying in it’s environment changes it, an Organizational Stages Model (OSM)

Economies are chock full of independently organized and behaving social and cultural communities behaving like organisms, that each develops from a seed of organization in an environment of resources.   You can talk about “why” things occur, causes at a distance or coincidences but that’s an intellectual issue, a prediction, a theory.  

This is about using the most general of pattern of “how” individual events occur the processes of developmental causation taking place in nature in every location where events occur.

Economies, for example, are all populated by actively creative and learning people, discovering things and following each other’s leads….  So what this “Organizational Stages Model” (OSM) approach focuses on for economies is how people learn and how what they learn to do spreads as transformational stages of growth and the emergence of new systems, and their natural limits.   The simple rule, for the transformative stages of any process of new emerging organization, then, is that it’s organizational process will follow an “S” curve.   The first half is of multiplying innovation and expansion of connections, a “burst of development”, and the second a process of rebalancing and integrating.

Organizational Stages Model

That’s the dynamic we need to capture in our minds to understand the world we live in.    An economy is really a whole “civilization” in fact, organized like an ecosystem, accumulating and passing on its knowledge of “how to live” in the form of family and social cultures, as the living “genetic code” of the societies they create.   THAT is what the word “growth” refers to, the compound rates of expansion of that whole organic living culture.

As systems of nature, all those living parts and the whole, first grow and then mature to live and later decline
by very much the same succession of life’s great transformative experiences.

The ultimate most useful model for it I found is really cool!   It’s organized as “a Narrative of Life” as a great chain of instrumental transformations.   I’ve been looking for a name for my life’s work on it.. perhaps “Life Narrative Studies” (LNS) would do.  I won’t further introduce it here, as it’s what my whole site is about, but just present this new graphic to help readers get a feel for the general pattern.

 

Organizational Stages Model (OSM)

______________ Continue reading Nature’s Capitalism: “Homemaking” now, not competition over shrinking pies! →

Natural Economy, Policy discussion, Scientific theory, What to do

Local views of global systems – mismatch of impacts & responsibilities

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This post was for the UN’s OWG 5 meetings on Sustainable Development Goals (SDG’s) from 11/23 to 11/27, submitted as an NGO contribution to  Post2015 energy development positions.   The issue here is that there’s a big mismatch between local and global measures for current accounting methods used to estimate the energy uses businesses are responsible for.    It’s an accounting discrepancy commonly on the order of five or tenfold, i.e. so large and undefined that local measures become not scientifically comparable.   It comes from the way the local measures are defined not including a way to account for the energy uses incurred as businesses pay for the services they use to operate.  The global accounting includes them by being the total of all economic energy uses combined.  

They have “consumption for production” just like technology, but just not yet being counted! 

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The global data is very clear, increasing GDP always requires proportionally related increases in energy use. Our local sustainable business plans for all sorts of projects seem to suggest the reverse, though, increasing revenue (fractions of GDP) with decreasing energy use!

What’s up??  Our math and the world’s seem to disagree!
Could some projects be outsourcing energy services and not knowing it??

The world economy grows as a whole
The world economy grows as a whole

There are two possibilities. Either there are hidden energy uses that our SD proposals are a)not responsible for, or that they b) are responsible for.  It’s hard to chase down puzzling discrepancies like this, but this one had an answer, published in Sustainability (MDPI)  in 2011, as Systems Energy Assessment (SEA).

What seems to be happening, all over the world, is the amount of **untraceable energy use** is growing… and so making SD figures unreliable and overly optimistic.

Continue reading Local views of global systems – mismatch of impacts & responsibilities →

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In two words… what defines “science”?

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It’s “asking questions”, of course ( silly!  ;-).

Science is also about asking particular kinds of questions, so you’d be missing a lot if you didn’t also ask “What kinds of questions is that?”…  and end up getting to the “big picture” by asking “But then,… doesn’t any question both open your mind to one thing and close it to another?”

So that more precisely defines science is a kind of “open territory” of all the kinds of questions one might ask, hoping to find ones that are particularly “informative” and give us unexpected “insight”, while keeping us clear of “jumping to conclusions” and other pitfalls.   It’s a long process of bending our minds to fit the world we seem to be part of, finding ways to both “get along” and to bend the world to suite us, guided by the landscapes, pathways, open skies and hidden traps of “understanding” and “misunderstanding”,talking to “busybodies” and “not so busy bodies”, that one finds traveling beyond “The Phantom Tollbooth” (ref the Juster & Pfeiffer masterpiece).

the question is...?

What have you been wondering about…?

One of the very most informative and useful questions I ever asked is “What is nature hiding from us?”.  That question came to me about 25 years after my first highly productive question of the kind. which was “what makes life so lively?”    I’ve had SO much fun with both those questions I really cannot tell you!    I don’t feel compelled to “look under every leaf and stone”, but having asked those two questions, using them as a kind of “lens” for studying what’s happening around us, it has made it quite likely that in any natural hiding place I look I’ll find traces of things “making life lively” as a way to study what they’re doing and how, along with leading questions about where they’re headed. Continue reading In two words… what defines “science”? →

Natural Economy, Natural systems, Policy discussion, Popular, Stories & Experiences, Transformation, What to do

A Hestian Map – the sacred hearth not at home in an authoritarian world

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I’ve been having a very exciting time discovering and building on the many connections between my scientific method for studying the development and organization of Natural Systems, and the wonderfully radical scientific feminism of Pat Thompson’s “Hestian Home Economics” (1,2,3).   They both center on what is at the heart of the liveliness of natural systems, the living culture and the home it makes for itself in its environment.  The protector of that home and hearth fire for the families of pre-ancient Greece was Hestia, the first of foremost of their personal archetypes of divinity, charged with protecting the **SACRED FIRE of HEARTH AND HOME**.  From a physical science of natural systems much the same can be said for the continuity any systems “seed of self-organization” around which it has developed its way of using the energy resources of its environment.   Same statements, two different wonderfully interconnected languages!   ;-)

To pre-Aristotelian Greek culture HESTIA was the first of the children of Cronus, charged with the first duty of civilization, protecting the sacred flame of hearth and home.   In how families still work today, that’s the continuity of their living culture, their ability to exercise their family traditions and practices, inheriting and passing on it’s joys and forms of knowing, adapting to their changing world as a bridge between their generations.   It’s that  CONTINUITY, then, that IS the living flame of a family home and the animating heart of any living culture, the *cont-in-uity* it develops and follows as it branches out, forming new expressions, that hav always been, and clearly still are today, the center of human life, the foundation of all our cultures. They are today also *quite threatened*, by our devotion to rules for demanding ever more productivity from these living cells that make our lives lively, driving everything sacred to us toward “make bricks without straw”, as it were, for the sake of misunderstood authoritarian rules…!

1) for her books look up “Patricia Thompson, Hestia” on Amazon. 2) PDF of Pat’s simple scientific systems thinking, that unlike virtually all other systems theories other than mine has living things and their archetypal living roles, included not excluded 3) How she deconstructs Roman historian Fustel’s history of Greek culture, that replaced the original (Hestian) cultural language with a commercial (Hermian) dialectic.

 

Let’s look at the territory,

and the basic maps of home economics and political economics

montserratnature

The basic map of home economics is a work of caring for the home culture. 

For political economics it’s the battle in the public sphere to gain advantage over others.  Pat Thompson calls them “Hestian” and “Hermian” systems, after the representative Greek gods, and we need to understand the action principles defining them.

The primary duty of the home maker, considering a family as a link on a chain of living culture, is to be the guardian of its flame of life and continuity as a culture.  Its living culture illuminates the home with its light and life, as the home serves as the commons within which the family culture inherits and passes on its traditions as family members live for each other, sustaining an “all for one” life of a true commons (Hestian culture).   Continue reading A Hestian Map – the sacred hearth not at home in an authoritarian world →

For teachers, Natural systems, Research & Measures

A “Commons“ is…

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A “Commons“

….Is a place, where

An organic culture

defines and makes its home

  • as its defensible and public space
  • for its communities of participants

serving as a “hive” for its internal relationships

  • usually as inclusive and equitable interconnections
  • (everyone to everyone)

serving as a “hub” for its external relationships

  • with its local niche of  ecological partners
  • with its open environment
  • (exploratory connections)
  • with and networks of remote exclusive connections
  • (one to one)

As its “Niche” in the world and “living space”.

 … for example

A “body”   is a commons for its cells

  • But bodies are organized differently than their cells, each needing to be part of a different culture

A “town”   is a commons for its villagers

  • But every town develops from its unique circumstance, so the usual patterns associated with the words are really questions about the individual thing

A “nest”     is a commons for its family or swarm

  • Living things need to sleep, and make secure places where they can “tune out” at night, to reemerge refreshed.
  • and so too the organizations of a commons, that come to a rest at night, to awake refreshed by the reflections of rest.

The Earth   is a commons for life Continue reading A “Commons“ is… →

For teachers, Natural systems, Stories & Experiences, Transformation, Uncategorized

Hay… We finally made the move !

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1948_NearTimlof-This NY blog is real glad the WordPress tools are so portable!!   We moved from servers in the Mid-West to ones in Virginia today!    I have more to say than time to write, and another website to build, or well… that’s the plan.   Plans change a lot.

I’ll probably keep just working on the “knowledge bridge”, a tremendous labor of love for me I guess, slowly, slowly, learning how to speak to people in familiar natural language terms about the wonderfully beautiful but unfamiliar deep organization of the living systems.    Why that’s possible is fascinating, that natural language actually evolved *by means of* referring to the working features of the complexly organized systems of life, as a “way to talk” about working with nature’s systems that we rely so heavily on them “just working by themselves”.

So… it really helps to notice that the meanings of our words really do originate from the natural meanings of the complex organizations of things in nature.   It makes natural language, by default, a quite advanced sort of “organic systems theory”.    All one needs to do is “just take a fresh look“, at the things our words already refer to in nature…

Using words like “friend” or “storm” or “house”, you both refer to common “word meanings” and also to the complex systems of familiar natural relationships that the words also refer to, along with how they work in the natural world as their “natural meanings”.     It’s a way to pull your mind back to connecting with the natural meanings of things, and a fuller way to experience them.    To enrich the “word meaning” with the “natural meaning” you just keep adding to your reflections on the things of nature as you experience your natural relationships with them.

New systems science, how to care for natural uncontrolled systems in context