First published as
A fatal flaw in the economy’s design ― Keynes first saw & the world forgot. By J L Henshaw – for the Jan 2023 UN people’s Global Futures Forum, Global Finance and Economic Architecture section.

Hi, I’m an accomplished senior systems architect, a physicist who, many years ago, found a useful scientific method for studying the designs of environmental growth systems, and the differences between growth systems taking emerging systems to fatal crises or long successful lives, what you might call “self-healing growth.” I also studied the design of UN systems at work in drafting the SDGs, which I attended and contributed to, learning a great deal about why our world economy’s growth is not.

It’s wonderful that systems architecture comes up for discussion occasionally, though rare. One reason it gets little attention is the focus on symptoms without addressing causes, as that is what most people notice. That’s important, of course, but it also perpetuates the causes. Where the cause is systems spiraling out of control, that’s bad. Today’s accelerating scales global impacts have terribly dangerous environmental, economic, and societal destabilization thresholds.

I was a physicist and then started studying the designs of natural systems designs and how they worked by themselves. As that’s not a usual scientific question, I stumbled across quite a lot. For example, physics never studied how SO many systems that develop by explosive growth at first, of both natural and human design, then, without a fuss, change strategies to then perfect their designs and connections to have active and creative lives long after their growth.

It means that nature figured out the solution to our crisis very long ago and that science did not think or see how to study how they worked. Societally we seem to get too wrapped up in problem-solving and ignore problem-sourcing, and then when we get in trouble then not change course as if always stuck. If we looked around, we’d see many systems that are responsive and change course, including ourselves often enough, examples that should be very helpful if we learned where to look.

A second important discovery is that although we discuss a growing economy in terms of numbers, economies are not numerical processes. Growth of every kind is a system-building process of creating working relationships that need to coordinate. Those new working systems originate from the build-up of connections around a tiny “seed” pattern. That produces a working whole that first multiplies more rapidly by exploiting its environment and then usually turns to make long-term relationships. Our economy is not yet doing that “part B” part of responding to limits. Keynes noticed that too, saying he thought, surely, society could find something better to invest in than growth when growth limits hit, mentioned in Ch 16, on “Observations on the Nature of Capital” in his 2nd book.

The main point is that *successful growth is always a two-stage process.* The first multiplying stage creates a new form of working relationships by growing as it exploits its surroundings. The second is perfecting the system’s internal design as it secures its new niche in the world. Call it “A then B.” The first stage lets it A) multiply its power, capturing more and new kinds of resources to build its ability to use and capture more. The second stage lets it B) refine and mature its designs to care for itself and secure its role in the new world around it. In other words, natural systems that survive their growth seem to display self-organization and self-control. That’s what humanity is supposedly trying to do, but having, as we often have throughout history, a terrible time of it.

The systems that become disrupted by external forces of their own making, as is happening to us now, differ from others that don’t by continuing to multiply their scale and complexity as they collide with hard natural limits. Those that respond to potentially disruptive changes caused by growth avoid harm by instead shifting to caring for themselves and their futures. That apparent intelligence from uncontrolled systems might only be from growth needing to be ‘self-animating,’ ‘responsive,’ and ‘cohesive.’ No growth system would get far if not also ‘exploratory’ and ‘adaptive.’ That’s not all that life is, but life always seems to have those capacities of acting as if out of self-interest and behaving cohesively as a whole. Our civilization seems unresponsive, though.

That humanity became unresponsive to the need to shift from investing in growth to care as threatening growth limits approached is the tragic mistake. We all respond to avoid such tragedies in every personal matter we can. We don’t keep taking out food for dinner till it’s a big pile on the floor with nothing left in the fridge or cupboards. No, we normally just start somewhere and A) take out approximately enough and then adjust as we B) make whatever will work for the occasion at the end to C) enjoy. That’s active steering. Civilization is not doing that, whatever you call it.

I think our societal blindness has to do with the difference between our two main ways of learning. The first is 1) absorbing experiences in familiar contexts where we become intuitively aware of and responsive to everything happening. The other is 2) making and sharing concepts. Concepts are inventions made from observed patterns that are simplified, taken out of context, and reassembled to suit our minds. How they often represent imagined realities to us and be SO satisfying we may not notice they represent a world without contexts, letting us become inordinately attached to the powerful ones. Using them hides any connection to possibly upsetting the contexts invasively controlled by their use.

The above only scratches the surface of the questions to ask, but tracing the history and demographics of this way of blinding ourselves to consequences seems to genuinely connect them to where we keep disrupting contexts by trying to impose abstract rules.

A practical response, sometimes a “cure,” lets people see their interest in caring for the contexts they might upset, something I call “contextual engagement.” The general principle is that you make better decisions if you see what’s going on. Elinor Ostrom’s video talk for receiving the 2009 Nobel prize for economics discusses it, and Gerald Midgley’s videos show his expertise in guiding divided communities to work together using it too. I’ve also developed useful methods for it, like asking people to list all the things in a given environment that connect with some primary concern — seeing the parts laid out as loose puzzle pieces makes people think much more clearly about the whole.

For more background, see my research journal, “Reading Nature’s Signals.” The theme is reading the essential non-verbal signals of change in our very lively world. We all get skilled at reading the cues in familiar contexts. Applying those skills to less familiar contexts is the challenge for learning to steer the world’s path ahead. Luckily in nature, most are related. The signs of trouble or relief and what to do next in one situation can be remarkably similar in others or at different scales. My way is to alternate reasoning and feeling, so when one turns up something odd, the other can help find what it is.

Note: This Figure is a very general schedule for the most creative and critical processes of natural system growth. The shapes and labels help notice what’s happening in the real contexts of interest. You look for how the succession of turning point events and developments take place. We seem to learn best when we’ve studied our ways of noticing interesting new connections and finding exceptions. We already know a lot about those, intuitively, so being self-critical to test those in new territory helps build what you see and clean up while better understanding the general pattern’s shapes and markers.