Wednesday, May 11, 2011

Engine Failure.

In the previous post, I tried to illustrate, using the engine example, of how optimising for one paramenter in a multiparametric system, may result in a deterioration of the the system itself. The question is, why does this occur?

Most stable systems have negative feedback loops, in that any perturbation from the designed state is met with immediate corrective action by the system itself to ensure its stability. The real danger arises when there is no negative feedback system, here the system progressively deviates from the desired state to a point of self destruction.

Now an engine motor, like society, is a human designed thing, and its operation is effectively under supervision. It follows then that the human operator is part of the system itself and being a intelligent and sentient being, why doesn't the human recognise the dangers beforehand and take corrective action?

In the first instance, the human operator may not care about the system integrity at all, and may actually wish the system to fail. Marxists, for instance, pursued active policies to destroy traditional bourgeoisie society which were wildly successful. The Marxists believed they could build a better engine.

In the second instance, the operator of the system may be operating it under ignorance, either deliberate or innocent, and does not recognise that the system is in dangerous territory.  Perturbations from the desired state which are obviously malignant are easily recognised and corrected, but perturbations which in the short term appear benign, or positively beneficial, are the most dangerous. Here the danger is not recognised, and in instances where there is apparent positive benefit, actually encouraged, accelerating the system decline.

All societies recognise the socially destructive effect of murder and make prohibitions against it. Very few societies see the socially corrosive effects of inflation and sexual liberation, seeing them as a benign or even positive perturbations of the system.  Improvements in the same way that "chipping the engine" improves system performance.  Its all win-win until it isn't.

Here in Australia, we are very sexually liberated. Our statisticians tell us that only 75% of people will marry, and of those that do 50% will divorce. That's a lot of emotional pain, loneliness, disrupted childhoods, domestic violence, etc. Most people cannot see the link between "bonding failure" and sexual liberation, but it's there.  Great party, hell of a hangover.

Sexual repression was in many ways a bad thing, but sexual liberation, may in the long run, turn out to be a very, very bad thing. The problem with long run damage is that it is not noticed by short term minds.  Especially whilst the corrosion is "pleasant".

"Pleasant" corrosion is perhaps the most dangerous corrosion at all. In democratic societies, the mob, fixated on the here and now, refuse to believe that what is pleasantly beneficial and without consequence currently, will turn out to be malignant.

America's economic golden age spanned from the beginning of the 50's to the end of the 60's. The chairman of the Fed at the time was William McChesney Martin, Jr.  He was the man who saw the Fed's role as "to take away the punch bowl just as the party gets going". (Negative feedback against popular approval). He was your classic mulitparametric analyst. He did not believe that the Fed could simply base its policy on a single indicator, rather its policies should be based on a thorough analysis of the economy. He was big picture man of fierce independence. Check out the Wiki link.  This point struck me as rather pertinent:
Martin was a graduate of Yale, where his formal education was in English and Latin rather than economics.
Big picture long term man.