Integrated Planetary Health Institute

Using the Science of Energy Systems to Rethink Today’s Global Crisis

COURSE DESCRIPTION

This course explores how the science of Energy Systems (ESS) is leading to a more integrated, accurate and practical understanding of systemic health in societies and economies. We use ESS to show why societal learning is the key to our future; why social justice and economic vitality are linked; and how laws of systemic health can be used to build a durably vibrant civilization, socially and economically as well as environmentally. Since societal health depends on group learning, students will use collaborative inquiry to aid their application of ESS principles to a practical, theoretical or narrative project of their choice.

BIG IDEA:

Our basic observation is that the same Energy System Sciences[1] (ESS) that explain systemic health in biology and ecology, can be used to explain health in human systems too. Our big idea is that ESS produces a more accurate picture of how the world works that shows us how to save civilization socially and economically well as environmentally.

Just as the telescope revised our view of the cosmos 400 years ago, so ESS is revising our view of societal health and how to survive our times. Its account of humanity as a collaborative learning species explains why we can build a better world. Its laws of growth and development show us how to do so. And, its predictive principles and precise measures provide practical markers to guide our steps. In this view, saving civilization will require replacing oligarchy with a more systemically healthy civilization built around four key pillars: societal learning, common-cause culture, regenerative circulation and resilient structure. Our goal is to clarify these laws so that people can use them to remake their lives and our world.

COURSE GOAL: This course seeks to give students:

LEARNING OUTCOMES: After completing this learning experience, students will be able to use energy-system principles in their daily life and their disciplinary work.

Essential Questions:

FOREWORD: Today’s Copernican Flip.

Throughout the centuries there have been the accepted facts, the conventional wisdoms…and often much of it turned out to be totally wrong. Then the visionaries stepped in, expanded our vision, and changed the picture.

James Burke, The Day the Universe Changed, 1985

There are no new facts in this book, only a clearer integration of established findings from a wide variety of fields. The result is a more accurate picture of how the world works that may save civilization. Just as the telescope revised our view of the cosmos 400 years ago, so today’s Energy Systems Sciences (ESS[2]) are revising our view of societal health, and how to survive our times. In this view, saving civilization will require replacing oligarchy with a more systemically healthy civilization built around four key pillars: societal learning, common-cause culture, regenerative circulation and resilient structure. ESS’ understanding of societal learning explains why we can build a better world. Its laws of growth and development tell us how to do so, and its principles and measures provide markers to guide our steps. Our goal is to shed light on these laws so people can use them to build a better world.

SAVING CIVILIZATION, BUILDING A NEW DREAM

“Your people dreamed of huge factories, tall buildings, as many cars as there are raindrops in this river…Now you begin to see that your dream is a nightmare.” How might we make things better? “That’s simple. All you have to do is change the dream… You need only plant a different seed, teach your children to dream new dreams.

Elder of Ecuador’s Shuar tribe, 1991[3]

We live in a head-spinning time of interlocking crises. At home, we face crumbling cities, outsourced jobs, skyrocketing inequality, and public austerity measures whose main purpose is to make tax-breaks for the rich more affordable. Economic insecurity, working-class stagnation and mounting debt are producing widespread misery and anger. Fear is now fueling populist outrage, authoritarian extremism, and the conditions for a fascist takeover. Meanwhile, climate change poses an existential threat to humanity itself.

For decades, people all over the world have been developing cures for calamities in everything from energy and agriculture to banking and business. Now upheavals from Occupy Wall Street to the Hong Kong protests indicate pressure for systemic reform is growing. Unfortunately, neither public pressure nor fruitful remedies appear be slowing global civilization’s rush toward oblivion.

How can we save civilization? Dutch historian Rutger Bregman[4] points out that all great societal advances begin as an impossible dream in the mind of someone who most people think is crazy. Written laws, human rights, democracy, suffrage for women, and the abolition of slavery all started this way.

If Bregman is right, then saving civilization will require we teach our children to ‘dream a new dream.’ Unfortunately, getting modern people to believe a new dream will be difficult because we live in a cynical world in which lying, cheating, stealing and betrayal are common strategies encouraged by respected authorities. Economists, for example, say the best possible economy comes from Economic Man, a coldly-calculating, rational agent aimed solely at increasing his own wealth. Biologist Richard Dawkins adds that human beings are,“…robot vehicles blindly programmed to preserve selfish molecules known as genes. Any altruistic system is inherently unstable because it is open to abuse by selfish individuals ready to exploit it.”

We will call this worldview: oligarchic capitalism.  Long experience with oligarchic organizations pursuing selfish ends has left most people assuming the world will always be a dismal place. Such pessimism also explains Bregman’s other observation: progressive reformers lack power because, while they are very good at raging against abuse, they are very a poor at articulating today’s impossible dream – a compelling vision of the next big reform we need to pursue.

What else could there be? Today’s glimmer of hope comes from a new Copernican flip, a more accurate picture of how the world works hidden in the same old facts. Just as the telescope revised our view of the cosmos 400 years ago, so ESS is revising our view of systemic health. Here societal health rests on four key pillars:

Naturally, this vision of vitality departs dramatically from today’s oligarchic worldview. Instead of systemic health rising from competition, self-interest, and greed-driven growth, here societal learning allows us to adapt, innovate and and realize impossible dreams like flight. Common-cause culture provides the glue that holds us together and the grease that smooths our work. Regenerative circulation fuels the future and nourishes the present; resilience helps us spring back from disruptions; and balance keeps us from succumbing to extremes.

Our goal is to show why this vision of health is not only scientific, but more rigorous than the current view. This science starts with the study of systems, i.e. profoundly interconnected wholes that are built of- and into other such wholes. Internally, for example, you are built of cells organized into muscle, circulatory and nervous systems. Externally you are built into various larger human organizations such as family and country, as well as the biosphere at large. The same nesting holds for every system imaginable from atoms in molecules to civilization in the biosphere.

Where many researchers use computer simulations to study complex systems, ESS is distinct because it uses energy dynamics. ESS is, in fact, an umbrella term for multiple disciplines that use today’s expanded study of energy systems to illuminate the laws of health, growth and development in biology, ecology and human systems too.

Energy makes sense as a basis for a unified science of systems because energy dynamics are universal: they apply to living, non-living and supra-living systems such as ecosystems and economies. The laws of health, growth and development also follow logically from the fact that energy provides the fuel for motion, the pressure that drives development, and the nourishment that keeps systems going. According to Einstein, even matter itself is made of energy!

Energy systems, however, create a very different picture of how the world works. Instead of a cosmos built of randomly colliding particles, it follows the ancient observation that all systems are flow-networks, organizations whose existence arises from and depends on circulating energy, resources, or information throughout the entirety of their being. Your body, for example, is an integrated network of cells kept healthy by the circulation of water, nutrients and products. Ecosystems are networks of plants and animals connected by flows of oxygen, carbon, nitrogen, etc. Societies are interlinked networks of people, businesses, communities and governments that depend on the circulation of money, information, resources, products etc. The movement of energy and matter even shows up in the Milky Way’s swirl. 

Scientists have been using the study of flow to understand systemic health in biology and ecology for decades (think: water, carbon, and oxygen cycles). Economists have also been using the related concepts of regenerative circulation and resilient structure to understand human systems as well. ESS’ approach, however, adds the concept of “information,” and from there, phenomenon such as learning and culture which are of particular relevance to human systems.

The combination of circulation, information and learning creates a more logical view of economic vitality than the one that dominates today. Where today’s economists imagine armies of antagonistic, rational agents focused solely on self interest, ESS sees networks of interdependent people, infrastructure and institutions whose survival depends on common-cause values that allow us to work and learn together. Where trickle-down promotes subsidies for the rich and austerity for the public, ESS says regenerative circulation, i.e. investing in human, social and economic capital, is critical because human abilities and networks form the engine of all economic power. Where GDP growth doesn’t care whether money goes to schools or CEO salaries, ESS says getting money, information and goods to the grassroots is essential because the entire system needs to be nourished.

Energy’s role in “information” shocks classical sensibilities most by creating an evidence-based explanation of why humanity is a collaborative learning species. Instead of competitive self-interest being the main source of prosperity, here humanity thrives by pooling information, forging ever-better hypotheses about how things work, and then changing our behavior by changing our beliefs. Instead of being locked in exploitative arrangements forever, our learning nature confirms that we are fully capable of changing our pattern of society. Indeed, history shows that we have done so before.

The collaborative nature of learning also explains why cultural issues such as fairness and justice connect directly to technical ones such as circulation. The result is a logical explanation of why economic vitality and social justice are inseparably linked such that you cannot have one without the other. Common-cause values, for instance, are essential to economic vitality because they allow us to work and learn together for the benefit of the whole society, not just the profit of a few. The erosion of such values undermines social fabric, resilience and our ability to survive.

ESS’ rigor adds a final surprise. Where classical thinkers see complex systems as hopelessly unpredictable, ESS uses energy’s predictable principles and measurable patterns to create common-sense laws and rigorous measures of systemic behavior. The prediction and precision that results is more suitable for the social sciences because it incorporates the uniqueness of each individual person, place and event.

How can we predict complex systems when every one is unique? First, note that energy principles are lawful, i.e. they follow reliable rules, and rules such as fuel and pressure allow us to predict certain aspects of societal behavior. Running out of oil, for instance, has the same effect on a petroleum-based economy as running out of food does on a living organism – the system collapses for lack of fuel. Similarly, just as high-pressure areas on weather maps help predict a hurricane’s path, so rising social pressures help predict socio-economic instability, while also identifying its source.  Energy laws make all of this ease to measure.

Precise measures are possible because energy produces snowflake patterns. Scientists since the ancient Greeks have observed that the universe’s vast complexity is fraught with organizations that (like snowflakes) exhibit universal shapes, patterns, and ratios; obey precise geometric laws; and yet are always individually unique. For example, no two trees, lungs, or river deltas are exactly the same, but they all exhibit the same hierarchical-branching pattern (now called a fractal), which maintains a specific ratio of small, medium, and large elements. Similarly, no two nautilus shells or hurricanes are identical, but they all exhibit the same the golden spiral.

These patterns exist because they improve energy flow. They can be used as targets for systemic health because they reflect relatively optimal arrangements selected over time. They can be used to create quantitative measures because, underneath individual uniqueness, the geometric rules remain precise.

ESS’ fusion of technical detail and common-sense culture replaces the idea of economic vitality through selfishness, growth and greed, with a vastly more logical explanation of how to build a durably vibrant civilization aaround resilience, regenerative and common-cause learning. Here sustainability is not only about saving the planet, it’s about saving civilization by changing our societal dream from a late-modern nightmare of untrammeled greed to an evidence-based forecast of lasting vitality achieved by following nature’s laws of systemic health. The icing on top is that most of these laws feel like commonsense because they are rediscoveries of ancient insights lost in the shuffle of modern life.

This fusion provides a foundation for an ancient impossible dream: the belief that we can build a durably vibrant civilization with justice and well-being for all. Now, the physics of flow suggests this goal is not a utopian fantasy, but a necessary and achievable new stage of civilization. In this way, understanding energy laws will help reformers save civilization and build a better world.

DISCUSSION: What would a truly healthy civilization look like?

Belief systems are to people what water is to a fish: the invisible medium which supports and connects us as we live our lives. Changing belief systems is part of learning, but even the most wondrous reforms are hard because they require challenging beliefs that form the basis of our lives and livelihoods.

Still, learning is vital today because our economic worldview is dismal, with those benefiting from unchecked power seeing no problem with growing concentrations of wealth, a disappearing middle class, and misery and instability rising everywhere else.  ESS predicts this worldview is coming to an end, and it is now time to put forth a new dream.

This discussion asks you to help envision this new dream by exploring what you think a truly healthy civilization would look like. Are justice, fairness, equity and other common-cause values important? What would education look like? What about health, jobs, opportunities, welfare and safety nets? Is economic vitality really a function of self-interest, efficiency and greed? What else could there be?

THE OLIGARCHIC DISEASE & THE LEARNING CURE

What did the Easter Islander who cut down the last palm tree say while doing it? Those trees were felled by rational actors who must have suspected that the destruction of this resource would result in the destruction of their civilization…

Societies aren’t murdered. They commit suicide, they slit their wrists and in the course of many decades, stand by passively and watch themselves bleed to death.

Jared Diamond, Collapse, 2006

The vastness of today’s systemic crisis leaves many people fearing the opening quote applies to us: our society has slit its wrists and and we are watching it slowly bleed to death. This fear begs the question: if humanity is learning species, why are we racing toward oblivion while most of the remedies we need are waiting in the wings? Answering this question requires we identify the root cause of our civilization’s self-destructive tendencies.

The root cause of today’s interlocking crises and our inability to address them is a power system called oligarchy. While oligarchy is technically defined as “rule by the few,” it is best understood as a system of self-serving power that tends to become increasingly sociopathic over time. In The Republic, Plato defined it as, “a government resting on a valuation of property, in which the rich have power and the poor man is deprived of it.” Aristotle called it, “government by the rich for their own advantage.”

Aristotle provided the classic rationale for one group’s right to ripoff another when he argued that, “Nature is built of elements that are meant to rule and elements that are meant to be ruled. Aristocrats are meant to rule slaves, and men are meant to rule women.” Anything else, he said, violated the observable and hence the “natural order,” a phrase used by generations of exploitation-justifying hegemons thereafter.

While oligarchy rests on pecking-order behaviors, it is not so much an unavoidable property of biology as it is a cultural system, a system of beliefs and behaviors enforced by a matrix of rewards, punishments, institutions and norms that keep people locked in line with economic leverage, social coercion, cultural manipulation and institutional control.

Oligarchic narratives, from the Divine Right of Kings to the Divine Right of Capital, are used to justify one group’s right – e.g. superiors, masters, owners – to own, control or exploit the work, wealth and/or life of another group, i.e. inferiors, servant, slaves, workers. Oligarchies become sociopathic because such rationales encourage elites to pursue wealth and power selfishly, without regard to lesser mortals or, indeed, to society as a whole.

Today’s problems are systemic because oligarchic culture is an equal-opportunity corrupter: it uses corporations, politics, government, religion, media, and even academia as vehicles for its self-serving ends. It has also taken many forms over time: aristocracy, theocracy and oligarchic versions of capitalism and communism. So, though our particular problem appears to be an oligarchic capitalism that puts short-term profit for owners above the health of people and planet, oligarchy is best thought of as a cultural disease that has afflicted the governance structures and relationship norms of many systems – from communism and capitalism to various religions.

Unfortunately, widespread participation in oligarchy’s extractive behaviors produces the slow societal suicide described in the opening quote. Relentless extraction drains the productive side of the society. Callousness, inequity, and insecurity fuel social tensions. Propaganda sows confusion and division, while oligarchic institutions block salvation by suppressing any reform that might diminish their power and privilege – think of the fossil fuel industry today.

Most participatant in this societal self-destruction do so, not because of any malicious intent, but because: 1) they are conditioned to follow established norms; 2) they don’t see a better way; and, 3) because stepping out of line is personally dangerous and difficult.

Still, societal self-destruction creates pressures, which push some people to seek new ways. So, while many great societies do collapse, history suggests what actually happens depends largely on the society’s ability to break out of its old box and learn better ways. One could say a society facing a systemic crisis is actually facing a learning challenge that can only end in one of two ways: it will either reform or regress; learn or die. Successful learning produces a new stage of civilization built around a new dream and some new set of reforms. Failure to learn causes calamity and possibly collapse.

This Learning lens provides a new view of the standard cycle of rise and fall as it is playing out today (Figure 3). Here, societal learning and survival move forward in an S curve cycle, not a straight line. New societal upsurges, like modern society 400 years ago, tend to build their beliefs systems around a guiding vision, which embody some set of critical reforms. Over time, oligarchic apologists twist the guiding vision and hijack its golden icons to better serve elite self-interest. Modern society, for example, built itself up around the Enlightenment vision of reason, freedom from tyranny, and rights for the common man. Reason, however, has become rational agents serving only themselves, while freedom and the rights of man have become the rights of the rich to be free from government oversight.

The more distorted and dysfunctional these beliefs become, the more pressure for reform grows. If reformers succeed in implementing better ways, a new pattern of culture emerges and the cycle repeats. Reformers build new institutions around lessons learned in their historical moment, but over time oligarchic pressures turn them into entrenched bastions of status quo power.

Stage 1: Common-Cause Upsurge. The typical cycle begins with a relatively egalitarian, reciprocity-based society whose population is growing mostly in the country-side and small cities. These communities start off tightly bound for reasons of mutual need, such as banding together against external threat (invaders) or simply because working together makes everyone’s life better. While such mutualism is common in small groups, societies that become great also have what Harvard sociologist Pitirim Sorokin calls a “spiritual spur,” an inspiring, common-cause philosophy that points to a higher purpose to which people willingly dedicate their lives. This spur usually embodies a partnership premise that explains why everyone should work for some noble higher cause. Medieval Example: Rising slowly from the ashes of the Roman Empire, medieval society was forged by the pressures of invaders: Vikings, Magyars, Muslims, Mongols, etc. Its spiritual spur was the vision of God’s Design. In this theory, God had established three Estates, each with a given task for the good of the whole. The clergy was to pray for all; the nights were to fight for all; and the serfs were to work the land that all might eat. Together, God’s three Estates formed an organically-whole community whose various parts worked together in a design that all sides saw as just and noble.

Stage 2: Growth Spurt and Golden Age. Stage Two begins with a leap in urban population. The society’s spiritual spur seems to be paying off. Rivals are conquered, threat reduced, and a golden age of relative peace, prosperity, and creativity ensues. Medieval Example: By the turn of the first millennium, Europe’s knights were turning back invaders. As the seas became safer and overland routes opened, commerce expanded, starting in Italy around 950 AD and spreading through Europe with the first crusade in 1096. As trade returned, specialized craftsmanship revived and guilds emerged. Commoners often used money to buy privileges from their lords, including freedom from the serf’s bond to the land. Free towns and free men emerged as nobles granted charters for liberties to free “communes” (towns) in exchange for money.

Stage 3: Social Evolution Heavily Shaped by Powerful Elites. Urban populations bulge as city wealth and opportunity attracts more peasants. As the population swells, the sense of community erodes as commoner groups splinter and elites become increasingly separate from the commoners they theoretically protect. Medieval Example: A growing taste for finer things plus the increasing cost of war meant that both nobles and clerics felt an increasing need for money. Despite the Christian anathema against money, both war and religion became more and more of a business. Ransoming fellow nobles produced income, as did pillage. By the late 1200s, knights who had had gained a taste for plunder began to form “free companies” which ravaged lands for profit.

Stage 4: Worldliness, Greed, and Rapid Decline. Increasing power and a dwindling sense of community leads to an elite class that is out of touch with its own people. Suffering from tax burdens and other abuses, the quality of peasant life begins to plummet. Paradoxically, the more disconnected elites become from their own people, the more obsessed they become with the moves of their rivals. They fortify personal power with complex webs of strategic alliances. Arms races blossom as elites concerned with defending and controlling their markets become so embroiled in their rivals that they bleed their home system until it crumbled. Medieval Example: We have come to the stuff of which class-warfare is made. To impress and defend, medieval elites poured vast sums into armies, castles, and impressive adornments, while putting less and less into their traditional fiduciary role of internal justice and external defense. The golden age waned as the founding theory conflicted with daily reality in ever increasing turns. Burn down the monastery and the butcher bishop? Late stage 4 is usually rife with class conflict because the social theory that melded people into an organic whole is now more facade than substance. Still, since early Stage 4 is often a high time for elites, most don’t see anything wrong. By the time they do, they tend to accelerate descent by pushing harder on very ways that cause the problem in the first place: advancing elite interests by exploiting others.

Eventually, this pattern of oligarchic civilization reaches its limits. With luck, some new set of iconoclasts channel growing pressures into a new pattern that resolves some issues and brings people together around a new common-cause vision. History shows the future: the progressive upsurge of the late 1800s, the Russian Revolution, the rise of unions, and FDR’s New Deal were all responses to widespread suffering caused by economies designed to advantage those who Theodore Roosevelt called “malefactors of great wealth.”

Oligarchic capitalism shows this cycle today. Trickle down capitalism proclaims itself the final, optimal pattern of society to which “There Is No Alternative” (TINA). Its ability to concentrate wealth supports this claim with grand imperial conquests and ostentatious displays of wealth. But, extractive (“rentier”) practices undermine the well-being of society as a whole by draining the constructive side of economy. The ensuing dysfunction is now creating pressure for reform.

Increasing pressure and instability will eventually reach a breaking point. At this point, we will have to choose to reform or regress, learn or die. Pressure provides the energy for change, but successful reform will also require: a unifying, motivating dream, and a set of reforms that in some way constrain abusive power and liberate life and learning.

The dream must unite people of all walks of life around a common-cause mission to make society better in some way. Rome had civic duty and the Republic; medieval society strove to build God’s city on earth; and Enlightenment reformers sought liberty, equality, and justice for all. The reforms must constrain abusive power, and liberate life and learning in some way. Wwritten laws, parliaments, civil rights, democracy and even the Enlightenment and Scientific Revolution fit the bill.

If the new dream and reforms take root, they will give rise to a new pattern of civilization with somewhat more distributed empowerment. You see this in the rise of modern democracy. The abuses of Britain’s oligarchic corporations fueled the revolutionary fervor of 1776 which, in turn, spawned an American democratic experiment built around Enlightenment reforms such as liberty, equality, reason and the Rights of Man. Similar pressures and fervor spawned other revolutions throughout the 19th century. These eventually turned the Democratic dream into a political norm backed by its own establishment institutions.

Through cycle after cycle, humanity has been whittling away at oligarchic power and prerogative with reforms from written laws and civil rights to democracy and antitrust laws. Unfortunately, oligarchic cadres tend to regroup. They then use their money to regain power by hijacking the original dream. They build new rationales, co-opt existing institutions, and overturn reform.

Neoliberal (trickle-down) economics cloaked in free-market clothing is the current example of this process. Since its rise in the late 1970s, oligarchic cadres using trickle-down reasoning have reversed New Deal reforms, destroyed unions, privatized commons, and corrupted politics with boat-loads of money. They have “gas-lighted” the mainstream public into believing that outsourced jobs, crumbling infrastructure, skyrocketing debt, gross inequality, and a dying planet are the inevitable byproducts of an automatically-optimal economy.

The result is irony incarnate. Where free-enterprise democracy began as a reaction against oligarchic abuse, today’s oligarchic capitalism is leading the charge against human and planetary well-being (at home and abroad), while claiming “There Is No Alternative” (TINA) to economies run for the rich.

In learning terms, we are now nearing the end of one S-curve. Today’s oligarchic takeover is nearly complete. We no longer live in a free-enterprise democracy with justice, opportunity and well-being for all; we live in a corporate oligarchy rigged for the rich. Oligarchic henchmen have turned free-enterprise icons into rationales for liberating the powerful to plunder as they please. They have replaced democracy run for people with government run for elites.

Now crises are multiplying; pressure is building; populism is booming; and cynicism is growing. The anger generated by this deception is also driving the rise of right-wing populism, along with the authoritarian demagogues who know how to channel its power. All of this suggests that the collapse of oligarchic capitalism is already underway.

The question is: will we be able to forge a new stage of civilization to replace it?

No one can predict the outcome precisely, but better ways are springing up for every crisis imaginable. Business has social responsibility, stakeholder-owned enterprise, democracy at work, and triple-bottom-line approaches. Finance has public banking, complementary currencies, and redirecting investment capital toward fulfilling human needs. Economists are rediscovering the importance of Keynesian circulation, and progressive policies are looking more attractive as the corrosive nature of oligarchic practices becomes clear.

Yet, progressive change feels threatening to establishment folks in government, media, finance, business and academia whose life and livelihood are built around the system as it is. Bringing such people on board will require a story focused on revitalizing the best of free-enterprise democracy, while separating it from the distortions that have turned it into a sheep-colored cloak for wolves.

Implications

Oligarchic civilizations – with extractive elites on top, exploited workers on the bottom, and establishment-serving professionals in the middle – claim to be the best possible system, but such societies have collapsed many times before. How can we tell if we are nearing collapse? The following list of “Signs of Failing Times” was developed by British anthropologist Sir Colin Renfrew in 1979

DISCUSSION: What parts of current culture should we keep, and what should we reform?

The upside of the traditional cycle is that it says we can learn! The downside is that the mathematics says it’s impossible to predict whether we will choose to learn in time.

If we do learn healthier ways, then modern society will undergo a cultural transformation process we call “great change.” Like a caterpillar becoming a butterfly, this process will change how our society looks and behaves, while keeping its heart, soul and previous life-lessons intact. So while many reformers believe modern culture has become so self-destructive that we should simply throw it all out, a learning lens says that free-enterprise democracy embodies hardwon reforms that we need to bring to a new level of function and beauty. Doing so will require breaking through the oligarchic distortions that are blocking its path to a new stage of life.

Prudence, therefore, requires we figure out what parts of our current system should we keep and which should we reform. That is the question we take up here: Is all capitalism bad? Is democracy salvageable? If not, what parts of each should we keep and how can they be reformed? Pick an arena – agriculture, business, energy, health, finance, government or media – and try to separate the original benefit from the oligarchic distortions in that field.

SCIENCE 2.0 – Energy Dynamics & the Laws of Systemic Health

The goal is not so much to see that which no one has ever seen before, but to think what that which no one has ever thought about that which everyone sees.

Arthur Schopenhauer

We are used to looking for great scientific change to burst forth from an obscure corner of reality, from subatomic particles, near-light speeds or little strands of DNA. Today’s change is different. It has slipped quietly into being as part of a natural expansion of abilities and it is taking place in every field as well as right smack dab in daily life. Furthermore, because you already know these patterns, once someone points them out, they seem obvious, like you knew them all along.

So, instead of some guru telling you how quantum understandings will change your thinking, ESS creates the kind of flip that Schopenhauer describes in the opening quote – new way of seeing the world you already know. Like an optical illusion that can be seen in two ways, we see how established facts fit a more accurate picture of how human systems work.

This brings us to the heart of our story. Our main premise is that ESS can be used to explain systemic health in biology, ecology and human systems too. The big surprise is how much ESS changes our scientific view of how to survive our times.

This huge shift in vision comes from changing the basic model by which scientists view the world. Where classical science imagines randomly colliding particles, ESS uses the ancient observation that all systems are flow-networks (or energy systems), organizations whose existence arises from and depends on circulating energy, resources and information throughout the entirety of their being. Your body is an integrated network of cells kept healthy by the circulation of water, nutrients and internal products. Ecosystems are networks of plants and animals connected by flows of oxygen, carbon, nitrogen, etc. Societies are integrated networks of people, businesses, communities and governments that depend on the circulation of money, information, resources, products etc. even the Milky Way’s swirl shows the spin of energy and matter.

Note that, while most people associate the term “energy” with various forms of fuel (e.g., oil or solar), here it refers to any kind of flow that is critical to the system under study. Ecologists study the flow of carbon and oxygen in the biosphere; transportation planners study the flow of traffic in cities; and economists study the flow of money, resources, products, etc.

Energy dynamics provide a logical basis for a transdisciplinary science of Systems because energy dynamics are universal (i.e. they apply to everything) and creative – they provide the pressure and fuel that produce the constantly circulating, inseparably linked systems we call flow-networks. Energy provides a logical basis for new stage of science because everything is built of flow-networks and energy laws explain why they emerge and how they will behave.

The result is Science 2.0, a new stage of science with a distinctly different worldview. This change is already emerging before our eyes. In recent years, modern computers have expanded the scientific explanation of why systems exist and how they grow and develop. These findings are expanding and connecting thinking in virtually every field – math, physics, and biology; agriculture, energy and education; business, banking, and urban planning. They have long historical roots in ecological economics.[5]

This new stage is timely because, where classical science is mostly siloed, with researchers operating in separate specialist disciplines, today’s crisis is systemic with interlocking social, economic, and political threads. Energy’s dynamic, nourishing nature explains the laws of health and development, while its naturally systemic nature creates an integrated alternative to the today’s piecemeal approach. So, where classical reforms focus on a particular issue, ESS provides the coherent, transdisciplinary roadmap we need to build systemic health in social, economic and political systems as well as the planetary one.

Its evidence-based explanation of humanity’s collaborative learning nature explains why we talk, make theories, and change our behavior by changing our beliefs. Here, intelligence began as a fruitful (if accidental) response to an energy nudge that evolved rapidly because it improved survival. Understanding the evolution of intelligence explains the dynamics of societal learning, and why we are designed to change ourselves and our world.

ESS’ unexpected rigor brings a final surprise. Instead of complex systems being hopelessly unpredictable, energy dynamics open the door to a new kind of prediction and precision for the social sciences, one that incorporates the uniqueness of each person, place and event.

The result is a view of systemic health woven around four central pillars, two technical and two cultural (Figure 1). The human side of health requires:

The technical side of health requires:

The next several sections explain these Key factors, and some of the laws that go with them. At the end, we explain the emergence of precise, predictive measures.

DISCUSSION: How does ‘systems thinking’ impact traditional views?

Systems thinking has been around for a long time, with ecology its most famous example. Appreciation of how connectedness and the flow of resources, energy and information affect human systems is now spreading to many arenas. Global supply chains, for instance, show how our daily life depends on the circulation of resources and information moving between economies, which are deeply entwined with diverse social and political systems.

What happens when everything depends on connection and flow? Pick an arena – business, medicine, media, economics, education, etc. – and explore how such “Systems Thinking” might impact its traditional views. In Integrative medicine, for instance, human health depends on the flow of nutrients and emotional, psychological, spiritual and physical energy of many types.

COLLECTIVE LEARNING & the Evolution of Social Intelligence

A company’s success no longer depends primarily on its ability to raise investment capital. Success depends on the ability of its people to learn together and produce new ideas… Companies die because their managers focus on the economic activity of producing goods, and forget that their organization’s true nature is that of a community of humans.

Arie De Geus, The Living Company, 1997

We stand on the precipice of great change, hoping the fog of confusion will lift and a new direction will become clear. Ironically, the best way to overcome this confusion is to recognize our true nature and embrace the profound power of collective learning.

So, instead of selfish automatons battling for supremacy in a Darwinian dog-eat-dog world, imagine that human beings are primarily a collaborative-learning species that thrives by pooling information, forging ever-better hypotheses about how things work, and then revising our behavior by revising our beliefs. This would explain why we talk, create scientific theories, and build cultural systems that preserve societal lessons learned over time. Our social nature would also explain why learning is not solely an individual act of mental gymnastics, but a group effort to thrive by innovating, adapting and constantly learning better ways.

For some reason we tend to overlook our learning nature even though it is directly responsible for all the miracles we have today. For example, in Creating a Learning Society, Joseph Stiglitz and Bruce Greenwald point out that today’s astounding technologies and lifestyles are due to the Scientific Revolution’s grand leap in “learning how to learn” as a society. As they say, “To understand how countries grow and develop, it is essential to know how they learn and become more productive – and what governments can do to promote learning.”

Similarly, Shell scenario planner Arie de Geus found that extremely long-lived companies, such as Stora in Sweden and Sumitomo in Japan, thrive by following a common set of cultural rules that put group learning and well-being at the heart of long-term vitality in business. As he says:

To keep the organization alive and growing, managers..must place commitment to people before assets, respect for innovation before devotion to policy, the messiness of learning before the orderly procedures, and the perpetuation of the community before all other concerns.

While everyone sees the importance of scientific and technological learning, Nick Hauer[6] argues that today’s most significant advances will come from social and civic innovations that satisfy unmet human needs for health, happiness, meaning and community. As he says: “The difference between a rich society and a poor one is the number of problems that a society solves for its citizens.”

Conversely, we are still racing toward oblivion because we have failed to learn despite clear evidence and loads of remedies waiting in the wings. The problem, of course, is that oligarchic capitalism is not designed to solve human problems, especially not societal ones. Instead, proclaiming selfish individualism as the source of all good things serves to stifle collective learning in a thousand ways. Alphas take credit for other people’s ideas, and owners take the benefit of other people’s work. Massive salaries go to the best social influencers, while those who invent the ideas and do the work are discarded at whim. Social synergy shrivels because bullying, ad hominem attacks and other dominance behaviors are rife in business, academia and everyday life.

Many plutocrats assume their dominance will go on forever, but populist revolts and progressive uprisings like Occupy indicate a lot of people have had enough. Even billionaires like Nick Hanauer say, “The pitchforks are coming for us plutocrats,”[7] if something doesn’t change. What happens when real opportunity for everyone below $100k evaporates entirely and people can't find decent paying jobs they can afford to live on? A quote from Occupy put it bluntly: "If you won't let us dream, we won't let you sleep."[8]

This brings us to why societal learning is critical today. The idea that we can build a better world is important because frustration with oligarchic capitalism has reached a breaking point. Naturally, the best way to save civilization is to harness all our vast social intelligence to the task of building a better world. While the learning we need is already underway, understanding the evolution of social intelligence can accelerate the process by clarifying the rules by which it works.

The Science

How did we become a collaboratively learning species that thrives by developing better ways? While Darwinians see intelligence as an accidental outcome of genetic mutation, ESS sees both genes and intelligence as natural results of energy-driven growth and development. This story of development was first developed in the 1920s, but Nobel Laureate Ilya Prigogine gave it a solid foundation in the 1970s by showing how an energy process he called self-organization drives the emergence of new organizations, and the ongoing, cyclical development of existing ones.

Example: Boiling water as an example of self-organization. Heat creates pressure that pushes molecules to move faster. When they can go no faster via random collisions, little bubbles begin to form. These begin moving up the side of the pot. Some eventually reach the top, lose their heat, and sink back down, triggering a large circular flow. If the heat/pressure continues, the pattern will repeat. The circular flow will go faster and faster until it reaches the limits of that pattern; some small bubble will trigger the system to reorganize into a yet more intricate figure ‘8’s pattern. (If all impurities are removed, bubbles don’t form and pressure builds until the system explodes instead of self-organizing.) Like all energy processes, self-organization is universal. For instance, tornados emerge from the confluence of: 1) a temperature gradient that creates pressure, i.e. warm air colliding with cold; 2) naturally-occurring variations, i.e. small gusts, twists of geography, etc.; and 3) geographical constraints (e.g. mountains) that block more gradual dissipation.

So, why does organization emerge and what drives it to develop? Self-organization’s basic rules are: pressure drives, diversity catalyzes, energy fuels, and constraints shape. This same process is used in boiling water. Energy buildups (in this case, heat) create pressures that drive change and fuel new organization. Naturally-occurring diversity (i.e., small impurities) provides the seed crystals that catalyze new patterns of organization by opening new paths of flow (in this case bubbles up the side). Without the constraints of the encompassing pot, water doesn’t organize it evaporates. If any of these factors are missing, organization will not emerge. For example, if all impurities are removed, instead of self-organizing, pressure will build until the system explodes. If there’s enough pressure to drive it, the process will also repeat. The first round of boiling water produces a large circular flow. If the heat/pressure continues, this circular roll will go faster and faster until it reaches its limits. If diversity is present, some small trigger will cause the system to re-organize into a more intricate figure-8 pattern.

Notice that, in boiling water, the large circular rolls circulate faster than random collisions, and the rolls go faster still. In physics terms, faster circulation means the system is doing more work, i.e., it is moving matter faster. In this way, self-organization explains why each successive pattern of organization can do more work because it is more developed (i.e. “complex”) because its internal arrangements are more intricately interlinked.[9]

Energy systems emerge, grow, mature, and then reach their limits. If pressure is still pushing, the system will be forced to either stop growing, regress, collapse or enter a new stage of development.

Limits also explains why organizations tend to go through natural, S-curve life-cycles. The right conditions generate new, more powerful organizations, but every organization has limits to how fast it can go, how much work it can do. If pressure is high when the system reaches its limits, pressure will force a change. At this point, some bit of diversity may catalyze a new pattern, but the system may also explode. There is no guarantee of which way it will go.

Like all good energy processes, self-organization is universal. The study of Big History[10] details its incredible results. In each round, pressure drives, diversity catalyzes, energy fuels, and constraints shape. The first atoms were forged in the intense pressure of the Big Bang. The first forms of life emerged from the fiery furnace of early Earth’s primordial chemical soup. The first hierarchical civilizations emerged in constrained areas of fertile land, such as the Tigris and Indus river-valleys, where population pressures created intense conflicts over land, giving rise to territorial wars and eventually a warrior administrative-class.

Our expanding universe constantly pushes for more, but can never achieves a final optimal system because every pattern has its limits. Recurrent rounds of limits and innovation produced a stairstep succession of increasing power, intelligence and organizational complexity from the origins of atoms and life to the latest cycles of civilization (Figure 5). Underneath, a web of energy-flow connects everything in a design whose incredible intricacy is hard to fathom.

The whole process works like a trial-and-error search with little bits of diversity casting about for ever-better ways to organize and flow. Small, unexpected differences bring forth new patterns of organization: boiling water has impurities; genes have random mutations; economies have maverick inventors; and societies have iconoclasts. New organizations arise, mature and reach their limits. Under the right conditions, some develop further. Those without sufficient fuel or diversity regress, collapse or, like a cockroach, find a way to stay put in a limited niche. At breakpoints, the system is so fragile that the system can go either way.

Self-organization creates a stair-step of increasing complexity & intelligence

Pressure from pent-up energy pushes new organizations to emerge and drives existing ones to develop further. Nonliving systems grow until the fuel is gone and then disappear. In contrast, living systems seek new energy sources by following energy trails. Increasing intelligence on earth led to humanity’s ability to learn collaboratively and restructure their world consciously. Human beings are designed to consciously reinvent themselves, hopefully moving toward more powerful and intelligent stages of development.

Some breakthroughs lead to radically new types of organizations. For example, the organization we call life emerged when some nonliving chemical organizations began responding to information about where to find a new energy supply (food). Information began as tiny energy nudges – a few photons of light or the chemical trail we call smell. Notice that such energy blips can also cause the system to move. Hence in this view, intelligence, i.e., responding functionally to informative nudges, probably started accidentally when some nudge propelled a cell toward a beneficial outcome, such as fuel for continued activity. Responding functionally to information evolved rapidly after that because each advance in intelligence allowed the organization to survive (i.e., continue) longer than those without such advantages.

Note that, instead of genes being the central premise of life, here living systems are distinctive because, where nonliving-organizations like hurricanes dissolve when their energy source disappears, living organisms use information to search for a new energy source called food.

Figure 1 Living organisms follow information to find food. Fine-grained energy trails such as a photon of light or the chemical gradients we perceive as “smell” produce the phenomenon we call “information.” “Intelligence” – the ability to respond functionally to information – becomes central to survival for living organizations because it allowed life to find food.

Multicellular life took intelligence in a new direction by circulating information internally to coordinate collective behavior. Your lungs, for example, need to stay in sync with your legs because, when you run, your legs need more oxygen which means your lungs need to breathe harder. When multicellular organisms first arose, staying in sync was easy because specialist cells were in constant contact (literally). But, the bigger multi-cellular organisms became, the harder it was to stay in sync. The emergence of the first nerve cell some 500 million years ago helped solve the coordination problem by circulating information across larger spans.

Groups of multicellular animals also increased collective intelligence by communicating, i.e. circulating information among themselves. Deer flash their tails to signal danger, and bees dance to show location of honey. Words to circulate information in incredibly sophisticated ways. Technologies like the printing press helped fuel the Scientific Revolution, and the Internet is accelerating communication and information processing today.

Advances in information processing and the preservation of lessons took life even farther. In living organisms, brains improve information processing, and genetic codes preserve lessons. Human beings use myths, cultural mores and books to preserve complex life lessons over long periods of time. Science is perhaps the best of humanity’s many information processing systems.

Human beings took intelligent response to a new level by organizing their communities around collaborative learning and conscious reinvention. Conscious collective learning, the ability to knowingly change a group’s response in light of new findings or changing conditions, turns basic intelligence into the ongoing pursuit of improving the group’s ability to live long and prosper, not just individually, but as a community of learners. In other words, it made humanity a collaborative learning species whose strategy is to adapt rapidly by learning collectively.

Humanity is the cutting-edge of this process on earth. We are a consciously-learning species that thrives by forging ever-better hypotheses about how the world works. We coordinate collective behavior by circulating information. We preserve life lessons in cultural norms, written laws, and scientific theories. We are not swift of feet nor sharp of tooth, but we are very good at finding patterns and using them to change our beliefs, our behavior and our world.

Humanity’s ability to learn consciously and coordinate collectively has allowed us to adapt more rapidly and innovate more powerfully than any other species on earth. It is directly responsible for all the marvels we live with today. Yet, human learning is never done because every pattern has its limits. Despite our adaptive talents, every civilization eventually reaches limits that force it to choose: cling to old ways and decline, or innovate and transform.

Some Implications

It’s easy to feel hopeless today because so much seems to be going so wrong, and the oligarchic system seems so immutable. This makes it important to remember four things:

Understanding the basic rules of self organization –  pressure drives, diversity catalyzes, energy fuels, and constraints shape – also provides a new way of looking at evolution in general and societal development in particular. In this view, Darwinian version of biological evolution is a slightly skewed subset of a broader story. Genetic mutations provide the diversity; constraints (conditions) in the environment create pressures which push organisms to adapt; and selection selects organisms that respond best to those those conditions. Unlike Darwinian evolution, however, self-organization works on whole systems, including ecosystems, networks of living organisms, and cycles of carbon, oxygen, water, and even soil health and land erosion. It is also “opportunistic”: the only systems that become more “complex” are ones that are able to harness more energy to do more work and build more internal structure. Unlike Darwin, the key to our survival and prosperity lies in societal learning, not selfishness and greed.

In this view, oligarchic civilizations collapse because 1) extraction and inequity create pressure; and 2) self-serving elites suppress any reforms (diversity/learning) that might reduce their power and privilege. These simple truths explain why historical cycles and parallels abound.

Notice that, in this view, Donald Trump and Bernie Sanders are like canaries in today’s coal-mine. Trump was elected in Sanders was popular because both represent antiestablishment backlashes to establishment elites (on both sides of the aisle) who have ignored the toxic conditions of unmet human needs and underutilized human resources growing in the wings. Here, the coronavirus and the economic devastation and generates may be the final spark that ignited already incendiary conditions.

This leads to two obvious conclusions:

Oligarchies fail to implement better ways because their goal is to increase elite power, not to improve societal well-being. Elites block effective collective learning because they have been taught to advance only their own well-being and that of their families and allies.

Oligarchic societies are prone to collapse because they distort information and hang on to discredited beliefs long past their time. Societal learning and intelligence fail because high-ranking people rationalize, manipulate and suppress systems and ideas in order to justify their privilege and power as necessary, optimal or desirable. Critical institutions cease to work well because cronyism leads to incompetence, and elites sell offices to the highest bidder or put unqualified sycophants, blood relatives, or cronies in charge. Eventually, distortion, suppression and cronyism come home to roost. Historian Arnold Toynbee identifies the moral corruption and cynical distortions that ensue as hallmarks of a failing society.

What then shall we do?

Understanding how intelligence evolves explains why using societal learning to develop widespread well-being is not a romantic pipe dream, but the central hub of societal health. Appreciating this fact suggests a number of things we need to do:

Support empowering education. The current approach to public education was developed in Prussia in the early 1800s, qwith the specific goal of creating docile workers who could read and follow directions, but not challenge authority. The advent of high-value capitalism is revising this need. Today, teamwork is critical as is creativity, initiative and the ability to make connections across fields. Instead of regurgitating pre-packaged bits of history and biology, more and more educators are teaching students to think, connect and examine reality from many angles. The best classrooms also make learning a group project where students learn to value themselves and others, and experience the pride and camaraderie that comes from contributing to a meaningful, common-cause endeavor. All of this tends to create more energized, empowered, critically-thinkins citizens we need for 21st-century enterprise.

Design collective learning into your organizational structure. Traditional companies tend to limit intelligence to the top, with a CEO listening to a small inner-circle of advisors. In contrast, as Arie De Geus notes (opening quote), the companies that thrives for long periods through incredible ups and downs build collective learning into their business process at all levels of the organization. W. Edwards Demings, for example, showed how Quality Circles solved problems and increased productivity by bringing the hands-on intelligence of factory workers to bear on issues they understood through daily experience. Distributed learning, taking place at all levels is essential today because a top-down approach is too slow for the complexity and pace of change in the modern world. Not only does harnessing the intelligence and insights of people at all levels and in all functions make the system work better, it gives workers a sense of ownership and involvement that energizes them and everything they do.

Make sure your learning process is open, honest, fair and inclusive. Effective societal learning cannot take place without open, honest processing and widespread dissemination of accurate information. Inclusivity is critical because diversity – i.e. differing interests, abilities, perspectives, etc. – is needed to fill niches and find new ways. Suppressing diversity reduces intelligence and vitality.

The Institute for Healthcare Improvement (IHI, see www.ihi.com) shows how organizing healthcare systems around inclusive learning improves outcomes while driving down costs. Their approach to organized learning mirrors the nervous system, with a broad, web-like network of information accumulation, processing, and exchange connected to facilitative higher level hubs. Local learning starts in small, mixed groups of clinicians, technicians, nurses and administrators using small, quick input-discussion sessions to develop mutually-beneficial remedies for issues in their intersecting areas, for example, scheduling delays or lab costs. They use similarly low-risk methods to implement and test these suggestions. IHI also develops “best practices” by connecting members to higher-level learning centers managed by experts who keep abreast of best practices in a particular arena. They also facilitate back-and-forth exchange among IHI’s numerous member organizations seeking best practices in that area. This combination of levels helps clinicians learn from research and other clinics; disseminate their own insights; and monitor their own progress. IHI has already shown that chronic conditions such as diabetes benefit from these kinds of integrated, thoughtful, coordinated approaches to management and treatment ─ and that the process benefits patients and practitioners alike.

Promote honesty and accuracy because culture and science play critical roles in preserving lessons and guiding human behavior. Honesty and accuracy are more important than modern society leads us to believe. Oligarchic capitalists constantly distort information and twist culture to make money. Somewhere deep down we know this is dangerous. The central importance of science, culture and collective intelligence leaves no doubt.

Pay attention to growing pressure because that indicates what issues need to be addressed. Modern economics is tone deaf because the only pressures it pays attention to are the monetary kind (economic demand). Meanwhile, the profound pressures generated by today’s unmet human needs and underutilized human resources are driving us toward a profound societal shift whose potential is great, but whose outcome is uncertain. Social pressures are particular important because unmet human needs and underutilized human resources can grow into society-destroying upheavals.

Learn how to build learning communities. While saving civilization is going to require many technical innovations, learning to build learning communities is our most important task because such communities provide the engines for improving everything else.

Happily, many of the rules of common-cause learning are well-known because many groups have been studying this question for a very long time. We know, for example, that effective teams require a cultural environment that promotes mutually-beneficial collaboration aimed at some common purpose that enhances the health of the whole. Nobel laureate Elinor Ostrom, for example, found that groups, which successfully manage commons (i.e., resources held in common), maintain mutually-beneficial behavior by incorporating eight principles. They:

DISCUSSION: How can we energize collective learning today?

Using this class as a test case, how can we use the above rules to create energized learning teams governed by common-cause values?

COMMON-CAUSE CULTURE vs Oligarchic subjugation and exploitation

It isn’t capital that creates economic growth, it’s people. It isn’t self-interest that promotes the public good, it’s reciprocity. It isn’t competition that produces our prosperity, it’s cooperation. An economics that is neither just nor inclusive can never sustain the high levels of social cooperation necessary for a modern society to thrive.

Nick Hauer, The Dirty Secret of Capitalism, 2019

While ESS insights are logical and well documented, they often seem outlandish because they depart so dramatically from classical views. Nick Hauer’s ideas (opening quote) are a case in point. The emphasis on selfishness in economics and social Darwinism makes the well-established importance of reciprocity seem like bleeding-heart nonsense. In the hopes of altering this impression, this section explores how the collaborative side of humanity fits in economics.

The gist is that, where most economists see common-cause values as nice but unimportant, ESS confirms that they are central to long term social and economic vitality. The harder question is why a species that depends on common-cause community created civilizations fraught with injustice, inequality and elites who show little concern for the well-being of the public at large. As historian Robert Artigiani puts it:

Humanity stepped out of nature, entering into an artificial environment where an affluent minority coerced the impoverished majority to work for the collective good..Why would these noble savages have ever left the Garden? Why were they foolish enough to create societies that were hierarchical, unequal, coercive, and militaristic?

The Science

Why did a collaboratively learning species produce an oligarchic civilization? Let us begin with the easy part: why common-cause values and binding ties are essential to economic vitality. This story starts with the observation that large systems are always built of smaller systems, which are built of smaller systems still. Living organisms are built of cells linked into tissues, organs and organ systems. Armies consist of platoons, linked together in regiments, brigades, and divisions. Molecules, multicellular organisms, herds, and civilizations all consist of smaller pieces connected in complex patterns of organization.

Why do smaller entities join in profoundly interdependent arrangements? The most obvious reason is that connecting specialists in coherent functions produces ‘wholes’ that can do more than any of the smaller entities could do alone. Farmers, distributors and retailers link together to create a food security supply chain. In biology, this symbiotic joining of previously-independent organisms into mutually-beneficial wholes is the main way life becomes more complex (Margulis, 1981). Land plants, for instance, reflect an immortal marriage between photosynthetic algae and rugged, non-photosynthetic lichens. The combination of algae’s ability to create fuel from sunlight, and the lichens’ ability to withstand harsh environments allowed the combo to conquer land. Similarly, the nucleus, mitochondria and flagella of complex eukaryotic cells were once independent prokaryotic cells that now serve as organelles of a larger, more sophisticated cellular system.

While joining talents starts out as mutual benefit, over time specialists become so dependent on systemic functions that they cannot live without a healthy whole. At this point, common-cause commitment to the health of the whole becomes vital to all parties involved. For instance, while the the nucleus, mitochondria and flagella of eukaryotic cells were once independent prokaryotic cells they have become so dependent upon one another that they can no longer survive alone. Modern people now depend so heavily on collaborating specialists to support all aspects of daily life – water, food, transportation, information, energy etc. – that they too are much less able to survive alone than their ancestors even 100 years ago.

Maintaining systemic functions also depends on keeping all those specialists connected, communicating and in sync. This requires various forms of connective tissue. Circulatory and nervous systems, for example, serve as connective tissue in multicellular organisms. Nerves, for instance, allow your your legs and lungs to communicate about activity (like running) and special needs (like more oxygen).

Human systems are held together by an array of connective tissue all of which allow our myriad specialists to engage in mutually-beneficial patterns of behavior (also called reciprocity). Transportation systems connect us physically, and water systems, sewer systems and electrical grids allow specialists to do their work. Language connects by providing a common medium of communication, and the symbol-system we call money connects by allowing people who don’t know each other to transact with trust. Even hierarchy is a form of connective tissue when it coordinates and directs in ways that improve the health of the whole.

Common-cause values and norms are the most important type of connective tissue because they provide the glue that holds us together and the grease smooths our lives and work. Manners reduce the friction of daily life by teaching us how to give-and-take in equal measure. Mythic stories preserve lessons and strengthen community bonds by giving people a common vision of where they come from, how to treat each other, and how they fit in the world. Values such as justice and fairness keep social tensions down by holding those who violate equitable give-and-take to account. Shame and pride have particular power in connected communities, less so in disconnected ones.

But, you might ask, if justice and fairness are so important, why are we still struggling to achieve these core common-cause values today? This brings us to the hard part: explaining why a social species would create civilizations where injustice, inequity and callousness are common. Where Darwinians attribute this situation to self-interest’s central role in evolution, ESS attributes it to the way hierarchy evolved from community-serving connective tissue some 5000 years ago to elite-serving power systems based on conquest, subjugation and exploitation.

This story starts with the other reason big systems are always made of interconnected smaller ones. That reason, a law of growth and development called the Surface-Volume law (SV), says that the only way a system can grow bigger is by keeping small elements connected in an ever-growing meshwork of connective tissue. This pattern of growth happens because all organizations are held together by bonds, and as an organization grows, the bonds holding it together become stretched until they reach a breaking point. At this point the only way the organization can grow bigger is to divide into two smaller organizations that reconnect using some form of connective tissue. An embryo shows the process (Figure 6a). An embryo starts as a single cell, which grows to a certain size, breaks into two smaller cells, which couple back together. The pattern repeats with each succeeding cell growing, dividing and linking back together. Figure 6b explains the energy reasons for this pattern.

This rule also applies to human systems. Anthropologist Robert Carneiro (1967), for instance, found that, when aboriginal villages reached a certain population size (volume), they either increase their internal connective tissue by adding new social ties (councils, clan affiliation, etc.) or break into two smaller villages that get by on existing relationship patterns. Figure 7a shows this pattern in the layout of Mokoulek villages in the Mandara mountains of Cameroon; 7b shows it in modern cities.

This process produces a pattern we call intricacy, i.e. lacelike networks of small, interlinked circles. Intricacy in human systems creates a clear picture of individuals linked in mutual benefit and common-cause commitment to the health of the whole. Intricacy’s benefits are summed up by the adage: small & connected = strength & speed. Intricate networks do for living organisms, what bundling does for sticks: they make the group stronger and more resilient than any lone individual. Intricate human teams with collaborative values are also faster, more flexible and more innovative than big groups because individuals know each other well; are aligned around a common mission; and are not encumbered by a distant bureaucracy. The resulting speed, flexibility and innovation can be seen in the flexible manufacturing networks found in northern Italy and Silicon Valley.

A developing embryo follows the Surface-Volume (SV) law of growth. The embryo start as a single cell which grows, and then divides into two cells that couple back together. The process then repeats with producing 4, 8, 16 cells, etc. In energy terms, linking small cells together also improves circulation because diffusion increases with surface area and small groups have more surface area relative to their volume then a single large ones This predictable pattern of development is called the surface-volume law because breakpoints occur when the cell reaches a 2/3rd power ratio of its surface area to its volume (size). Intricacy helps us see why growth in size tends to drive development, i.e., the proliferation of specialists and functions linked by new forms of connective tissue. Larger organizations can support more specialists, but require more connective tissue. Innovations that help specialists stay connected increase collaborative power, intelligence and capacity. Failure to stay connected leads to stagnation, regression or collapse.

The need for connective tissue also explains the emergence of hierarchical structures in both biological and human organizations. For instance, when multicellular organisms first arose, communication was easy because specialist cells were in constant contact (literally). Passing resources or signaling an event was a simple matter of releasing a small chemical or electrical discharge. This process, however, only works for organizations below a certain size because signals dissipate with distance. Eventually, some organism – some people say it was jellyfish 500 million years ago – developed a cell whose specialty was passing information across longer distances. This nerve cell cleared the way for organisms to grow bigger.

Figure 7a & b. Surface volume development playing out in villages and modern cities.[11] The Mokoulek villages in the Mandara mountains of Cameroon embody surface-volume designs, with small circular granaries and larger circular granaries spiraling within 3 large stone enclosures, which themselves spiral from a central point which is the square part in the blueprint. Figure 7b shows it in a modern city.

As organisms grew bigger, the process repeated. Single nerves multiplied into nervous systems, eventually with a brain sitting on top whose primary specialty was to find informative patterns in the information-highway below. The process of the connecting by communicating repeated again in groups of multicellular animals, i.e. herds, flocks, and societies. Deer use their tails to flash warnings to other members of the herd. People use words to signal all sorts of things.

Figure 7. Pressure to state collaboratively connected drove the evolution of nerves, brains and hierarchies. Growth pressures also drove human groups to develop new forms of organizational structures, economic patterns, and cultural mores that help large groups live and work together.

Growth pressures also pushed human groups to evolve from agrarian villages to hierarchical civilizations. Human groups started as small, foraging, hominid pods connected by family ties. Communication could be done easily through grunts, hand gestures, and constant contact. As groups grew larger, hunter-gatherer tribes emerged with individuals performing various specialist roles such as arrow-maker or healer. Grunts evolved into words and cave paintings became symbol systems communicating dreams and plans for the next day’s hunt.

Agrarian villages were connected by structures such as clans and councils, linked by communication systems such as myths and money. Close to the land and each other, early agrarians used a mutualist culture linked by small-scale intricacy. In this system, leadership was a Guardian function, a fiduciary responsibility to protect and guide the community toward systemic health. It didn’t give leaders power to exploit other members.

Unfortunately, this seemingly idyllic arrangement has limits. Once a village grows beyond about 350 people, mutualist ways start to break down because community members no longer know each other well enough to communicate and coordinate rapidly for common-cause issues such as defense. Eventually, the pressure to mobilize rapidly gave rise to a new form of connective tissue: command-and-control hierarchies run by warrior-chiefs. One man deciding for all backed by an efficient administrative hierarchy allowed fragmenting societies to act as a whole. Societies without them couldn’t mobilize fast enough to survive.

In short, while small-scale intricacy worked well early on, eventually societies became so large that horizontal connections were not enough to maintain coherence. At this point, growth pressures drove the development of hierarchical structures, i.e., highly efficient, vertical ones, that improved communication, coordination and decision-making across long distances, large numbers, and multiple scales.

This brings us to the paradoxical side of our story. Now in theory, large societies actually need the best of both worlds. They need the strength, resilience and speed of grassroots intricacy and they need hierarchical structures to coordinate and communicate across levels – with both aimed at the health of the whole. In practice, we tend to use the oligarchic form of hierarchy that emerged some 5000 years ago with empire-building societies, particularly in the Middle East. Instead of mutual benefit, these hierarchies revolve around subjugation, exploitation and conquest.

Carneiro (1970, 1987) suggests this empire-building system was also driven into being by growth pressures in constrained regions. He starts with the observation that hierarchical civilizations originally emerged in places where desirable land was hemmed in by geographical constraints. Examples include the Tigris-Euphrates, Hwang Ho, and Indus river valleys and the mountainous valley of Peru. While early tribes in these regions quarreled with their neighbors, these clashes were mostly about revenge and prestige, not land. If quarrels were particularly bloody, a tribe would just move. Once the desirable land was filled, however, the nature of war changed.

Tribes with no place to go became increasingly focused on eliminating their enemies and taking their land. At first, tribes probably simply annihilated their opponents. Eventually, however, some chief turned the defeated people into slaves who were forced to work for the conquerors. The most successful warriors among the victors were given the task of administering the new areas. Administrators also collected tribute (later called taxes), which allowed them to concentrate wealth and apply it in focused ways. Since administrative classes lived off these funds, they increased efficiency by constantly pressuring the lower classes to produce more. They used this wealth to expand their power by mobilizing work-groups of slaves to build roads, fortresses, and irrigation works.

Since warlords (later called aristocrats) made their money by exploitation at home and conquest abroad, they also tended to pour community resources into the war-for-profit game. Each increase in concentration, coordination and connective tissue expanded the victors’ reach and power. The result was a punctuated pattern of increasing hierarchical complexity, from chiefdoms to kingdoms to empires – all made possible by this system’s amazing ability to concentrate resources and mobilize masses.

In short, conquerors made themselves kings and created bureaucracies and classes to manage the people they enslaved. Instead of a mutual-benefit system built around common cause and relative equality, society split into classes with increasing levels of privilege and immunity at the top; oppression and exploitation at the bottom; and priests, engineers, and bureaucrats in the middle.

While the old agrarian, reciprocity patterns still held sway in the populace at large, the power system that governed these societies became much more focused on conquest and exploitation. Cultural inventions such as “owning” the land, which had previously been held in common, gave aristocrats the right to all produce regardless of whether they had labored or not. Since living off the work of others often required force, injustice and inequality blossomed alongside new forms of extraction, such as rent and debt. Soldiers and policeman became tools of elite control, but since engineers and the clergy were usually employed by the aristocracy, religion and science were often co-opted as well.

Aristotle provided the classic rationale for one group’s right to ripoff another when he argued that, “Nature is built of elements that are meant to rule and elements that are meant to be ruled. Aristocrats are meant to rule slaves, and men are meant to rule women.” Anything else, he said, violated the observable and hence the “natural order,” a phrase used by generations of exploitation-justifying hegemons thereafter.

This oligarchic system flourished, however, because it created a powerful economic engine, with burgeoning cities, advancing technology, and a thriving middle-class. Societies centered on war revolve around a military-industrial-governmental complex which wants to buy the best weapons and biggest armies to conquer their neighbor and/or defend against their enemies. Cities grow massive as craftsmen making armaments and merchants selling to soldiers spring up to support the cause. Successful conquests accelerate the process by liberating large quantities of gold stashed idly in aristocratic vaults. Technology, production, and monetary circulation burgeon and a cycle of increasing money, power, and influence emerges and accelerates – all because successful aristocrats had more money to buy property, arms, henchmen, slaves, influence, and soldiers loyal only to the noble. The cycle of concentration also accelerates because powerful elites begin to influence social evolution in a way that serves their own interests, but not the common good.

Unfortunately, while oligarchic power seems immutable, societies that train elites to put their own interests ahead of systemic health influence tend to become more unstable over time. Part of the problem is that the bigger the society gets, the more disconnected elites become from the people who do all the work. Growing apart is particularly dangerous for oligarchic societies because antagonism is built into the system in the form of inequity, injustice, callousness and betrayal. As distance grows, the ancient ties that bind elites to their people cease to rein them in. Jockeying for power and seeing themselves as the only important people, elites pursue their own interests despite the costs to the whole. The more intensely they pursue, the greater the populace suffers and the more acute the sense of betrayal becomes. Common-cause bonds, already shamelessly thin, wither and break.

In this way, endless exploitation and injustice eventually take their toll. Even if new technologies for communication and connection emerge, they cannot overcome the lack of common-cause values that bind people together. So while hierarchical structures are necessary for societies beyond a certain size, oligarchic hierarchies never last forever.

On the other hand, oligarchic crises drive reform movements Greek, Roman, medieval, modern: failure on many fronts forces a society to rethink itself or collapse. Each round emerges as noble response to and more effective replacement for corruption and crisis in the previous scheme. Each eliminates some abuses and improves the society a bit with reforms such as written laws, representative government, civil rights, etc.

Successful reforms have been slowly curbing the power of self-serving elites for millennia. We appear to be on the cusp of a particularly large crisis/reform cycle today. Oligarchic societies centered on empire building emerged in the Middle East about 5000 years ago. The modern Reformation to the political, economic and religious oligarchies of the late Middle Ages came to the head about 400 years ago. Many people believe today’s transformation represents the end of both both these cycles, the 400-year cycle of modern society and the 5000 year cycle of oligarchy. Reasons for this are clear. The pace of change and level of complexity of today’s world is simply too great to be handled by top-down command-and-control hierarchies. Our ability to kill ourselves by poisoning the biosphere, nuclear holocaust, or the collapse of trade routes that bring critical supplies, also make cost of self-serving elites simply too great to continue.

Some Implications

Surviving this crisis will require learning out how to replace oligarchic capitalism with a healthier way of staying connected, collaborative, functional and whole. Understanding the importance of common-cause values and connective tissue can help us survive by changing today’s oligarchic view in several key ways:

Common-cause values such as fairness and social justice are essential to economic and social vitality. Without them, societies fall apart.

Oligarchies eventually go under because they put elite self-interest above the health of the whole. The Trump administration’s approach to the coronavirus demonstrates the problem of putting private wealth over societal health. Instead a coordinated national response aimed at maximizing the health of the whole, all states and individuals were left on their own, while profiteers worked to extract more for vital medical equipment.

Incentivize reciprocity. Where most people assume social synergy comes from family and community values, a great deal of sociological research suggests that the real trick to turning fractious groups into synergetic ones lies in in incentivizing mutual benefits and reciprocity as the centerpiece of all behavior. A surprising amount of sociological research shows that reciprocity, i.e. mutually beneficial interactions, is the key ingredient in social synergy. It is quite literally the glue that holds us together and the grease that smooths our work together.

Interdependent specialists linked by common cause increases our appreciation of “commons,” i.e. public goods which must be maintained for the health of the whole, and which require equal access for every member of the society. Where oligarchic societies emphasize private property, a society built of specialists, who depend on the health of the whole, needs to make sure that all members have equal access to public goods such as: clean air and water; decent health, education, shelter and safety (e.g. law and national defense); accessible transportation (e.g. roads); and reliable communication (e.g. mail and Internet). Common-cause values such as justice and fairness are also essential to health in such systems.

ESS also increases our appreciation of “commonwealth” governance. A Commonwealth is a group of people or entities that connect around the common-cause goal of maintaining their collective health by helping each other, sharing knowledge and resources, and otherwise improving themselves. One of the main ways Commonwealth governments serve the public good is by developing connective infrastructure, coordinating access, and maintaining the quality of public goods. Governments need to perform public service roles because public goods require open, equitable access at a scale that no private entity can handle alone, especially not one based on maximizing profit for elites.

ESS diverges most starkly from oligarchic thinking around the issue of social conscience. Oligarchies have an ambivalent relationship to common-cause values. On the one hand, virtually all hierarchies still perform many Guardian functions. Governments, for instance, promote the common welfare with roads, schools and justice systems; and provide for the common defense with armies. On the other hand, instead of using reciprocity to build common-cause community, oligarchic politicians use divide-and-conquer techniques to keep the rabble in line, while periodically fanning the flames of tribalism to keep their xenophobic base motivated.

Most oligarchic hierarchies also have people who use their power to feather their own nests and those of their cronies. Today’s trickle-down oligarchies advance elite power at the public’s expense by cutting taxes on the rich, subsidizing big corporations, and limiting funding to education, infrastructure, green energy, and public justice. America’s oligarchic politicians use community symbols like the flag to rouse patriotic fervor, and they invoke the need for public safety to increase military spending. In recent years, the American government has also: privatized many military functions; given no-bid military contracts to a vice-president’s company; and poured trillions into an endless Iraqi war with no identifiable cause other than access to Iraqi oil. Meanwhile, oligarchic capitalists seek to maximize the money they get from every source possible from stock market gambling and war profiteering to banking fraud and outsourcing jobs.

Oligarchy tends to ignore the fact that we are a social species whose ability to create miracles depends on our ability to work and learn together to build a better society. Instead, oligarchy uses dog-eat-dog competition to justify the predatory quest for monopolistic dominance. It glorifies “self-interest” to justify its lack of concern for other people and the system as a whole. Worst of all, it use the unerring hand of laissez-faire to encourage adherents to take pride in their lack of social conscience. As economist Milton Friedman said in a 1970 article: “The sole purpose of business is to generate profit for shareholders …Acting ‘responsibly’ risks reducing profits or forgoing revenue in the name of social good.”[12]

Most of our problems are a result of oligarchy’s belief that serving elite-interests is the best way to run the world. Friedman, for example, believed freeing wealthy capitalists from acting “responsibly” would produce the best possible economy. In practice, it produced all the calamities we now face from global warming and gross inequality to crumbling infrastructure and political corruption. The backlash to these debacles can now be seen in the upsurge of organizations promoting corporate social responsibility with triple-bottom-line, sustainable business, and other practices that specifically incorporate social and environmental responsibility.

What then shall we do?

Oligarchic capitalists have been telling a huge and highly consequential lie. Besotted with trickle-down, they tell us that private capital is the most efficient way to answer all needs. In fact, it is only good at meeting the needs of the wealthy, i.e. people who have enough money to exert power and/or create economic demand. Trickle-down is actually monumentally inefficient at meeting human needs for most public goods, including health, education, shelter and infrastructure from water and roads to electricity and the Internet. Optimizing elite profits harms public goods because companies extracting as much money as possible tends to lower wages, quality and access. All of this can be seen in America’s dysfunctional healthcare system.

What then shall we do? The obvious answer is: coalesce around common-cause democracy and honest free-enterprise. Former Labor Secretary Robert B. Reich outlines the basic plan:

“The way to overcome oligarchy is for the rest of us to come together and form a multi-racial, multi-ethnic coalition of working-class, middle-class and poor Americans fighting for democracy. This agenda is neither right nor left nor merely in the middle…history shows that oligarchy cannot hold power forever. They are inherently unstable. When the majority population sees oligarchy as illegitimate and an obstacle to their well-being, oligarchy becomes vulnerable. Our great strength is our resilience.” [13]

How do we support this common-cause coalition? Some of the more obvious ideas are:

Support common-cause values – Values such as fairness, honesty, integrity, and commitment to the health of the whole, reflect mutually-beneficial patterns of behaviors learned over time. They also build the bonds of trust and safety that hold us together. Without them, we fall apart.

Reject the idea that selfishness forms the unchanging centerpiece of human nature. Theories like Economic Man and Selfish Genes reflect an oligarchic worldview: civilization run by selfish, superior beings who stand above the morality of lower mortals in their endless quest for more power, prestige and money.

Work to create real democracy, government that truly serves the public’s interest. Oligarchic hierarchies serve some Guardian functions to protect, coordinate and and facilitate the societal whole, but recent research confirms that America’s supposedly democratic government is primarily responsive to the desires of wealthy patrons. Since one man one vote is not enough to create real democracy, we need to develop a system of remedies including: honest, accessible voting;  getting money out of politics and keeping politicians from choosing voters instead of the other way around. Developing this system may be the greatest challenge of our time.

Expand the notion of commons. Civilizations need common-cause infrastructure – from roads and schools to energy and law – in order to function as a whole. We have recently realized that air, water and the biosphere at large are also commons that needs to be maintained. We need to expand this realization to include information, health, education, safety nets and social justice.

Replace today’s shareholder model of capitalism with a stakeholder model of business. The calamities of World War I, the Great Depression and World War II gave rise to New Deal reforms and to a “stakeholder” form of capitalism, in which CEOs saw accountably to workers, consumers, citizens, shareholders and the community in which the company was headquartered as part of their patriotic duty. Though taxes on upper-escheolon wealth were high and regulations on capitalist misbehavior were strong, the economy soared and the middle-class blossomed.

Unfortunately, oligarchic capitalism regrouped in the 1980s and began building a stockholder model instead. Corporate raiders often led this change. In order to increase stock prices, wealthy investors such as Carl Icahn bought controlling shares of businesses such as Nabisco and Texaco and then forced them to cut wages, outsource jobs, and generally try to make the company “lean and mean.” Stock prices and investor wealth soared, while worker pay, benefits and jobs plummeted. This caused pressure on CEOs to maximize shareholder profits in other ways as well. Stock buybacks, derivative scams, political payoffs, suppression of unions, and the creation of “right to work” states created an escalating concentration of wealth at the top and increasing misery and instability everywhere else. This is now coming to a screeching halt.

Learn to build healthy hierarchies, ones that serve the health of the whole. A hierarchy is an essential form of connective tissues, whose authentic role is to serve the health of the whole by providing broad-scale planning and coordination, and by concentrating commonwealth resources and applying them efficiently to public goods. Healthy hierarchies that serve the public still exist – as hospital workers demonstrated during the coronavirus.

DISCUSSION: How can we replace oligarchy with healthy hierarchies?

Oligarchic hierarchies destroy societies at home and abroad because they are designed to serve elite interest regardless of the harm done to anyone or anything else. This discussion asks you to explore ways to move toward replacing oligarchy with healthy hierarchies and a stakeholder model of business.

REGENERATIVE CIRCULATION vs Oligarchic Extraction

Money is like manure; it's not worth a thing unless it's spread around encouraging young things to grow.

Thornton Wilder, The Matchmaker, 1954

Paraphrased from Francis Bacon, The Essays, 1597

Like many classical economists, ESS agrees that money works like manure: spreading it around makes things grow, and stockpiling it makes things stink. Money makes things grow because, like all good fertilizers, it brings nourishment. A society built of specialists needs regenerative circulation, the kind that nourishes all the people, organizations, and infrastructure that form the productive side of the economy because such investment fuels the present and grows the future.

The nourishing power of money makes sense in a flow-network model because circulation is central. Oligarchic capitalists tend to overlook circulation because they believe self-serving agents produce the best of all possible worlds. Freed from concern, self-serving capitalists blithely extract wealth from the productive side of economy in order to concentrate it at the top. They drain constructive organizations with rents, usury and debt, and use monopolistic dominance to extract as much as they can. They also dilute money’s power by manipulating stock and realestate prices. Since they believe obscene inequality and growing gaps between the haves and have-nots is natural, they blame poverty on the poor, who they see as lazy “takers” living off the beneficence of oligarchic elites who are the real “makers” (e.g., see the works of Ayn Rand).

The Science

Why does spreading money around make things grow, while stockpiling it makes things stink? ESS’ explanation of this fact starts by changing our view of the kind of system an economy is. In this view, economic networks of interlinked specialists serve the same function in a society as a metabolic system does in a living organism. Economies are – or should be – self-renewing systems for turning energy, information and resources into all the products, services, information and fuel a society needs to thrive. Here, people, businesses, communities, value-chains, governments and even the biosphere are like cells and organs in your body: they all play diverse roles in production, distribution, and learning. All social, economic, political and environmental systems are deeply interdependent because only together do they create a functional whole.

Circulation is critical because money is like blood: it is a vehicle for circulating the information, products and resources that nourish economic muscle and brain. Nourishing all levels and sectors is important because elements at each level play distinct, interlocking roles in a highly interdependent whole.

Some implications:

This metabolic model leads to several obvious laws of systemic health:

Make sure money information and resources circulate robustly across scales. Cross scale circulation is essential because vitality depends on the care and feeding of the entire network of individuals, businesses, farms, value-chains, cities, institutions and governments. Conversely, poor economic circulation produces economic necrosis, i.e., the dying off of large swaths of economic tissues with accompanying damage to the health of the whole.

Invest regeneratively. Pour resources into the human, social and economic systems that keep an economy functioning because human abilities and networks form the engine of all economic power. Funding human and social capital is particularly productive because vitality depends entirely on the intelligence and energy of the people that do all the work!

Nourish constructive activities. The obvious reason to support constructive activity is that it fulfills all the functions that allow us to survive. The more local monies are spent on constructive activity, the more local systems flourish. Conversely, local wealth elites extract, the weaker and more fragile the local system becomes.

Limit debt, speculation, extraction, and oligarchic manipulation of prices and money. Not only do these oligarchic practices drain constructive functions, they also serve to concentrate wealth, and (as explained below) create an oligarchic “doom loop” in which the more wealth elites have, the more they rig the system to increase their wealth even more. Excessive debt is particularly dangerous because compounding interest creates an escalating drain, and incendiary conditions when people cannot pay there debts (see the works of economist Michael Hudson).

Maintain reliable inputs & healthy outputs. In flow-networks, running out of a critical resource is a death sentence. Plants need water; businesses need money; and societies need robust circulation of money, information, goods, services and resources from food and water to energy and electricity. Unhealthy outputs are dangerous because the concept of “poisoning one’s own nest” applies as much to civilizations as to animals.

Money’s role in nourishing economic vitality also makes the problem with oligarchy particularly glaring. Concentrating wealth for speculation or self-aggrandizement does not fuel the real economy. Low wages and lack of seed capital for small firms reduces circulation and causes economic necrosis, the dying off of large swaths of economic tissue. Poverty is primarily the result of extractive processes, and gatekeepers who snub marginalized groups like Blacks, Jews, women and gays. The kind of skyrocketing inequality we see today indicates necrosis underway.

Now none of these ideas are new. Economists have been developing the metabolic view since at least the 1920s. Keynesian economics centers on circulation, and the manure view of money goes back at least to Francis Bacon in 1597. ESS merely supports these long-standing ideas by grounding them in measurable energy principles.

The main difference between the metabolic model and oligarchic capitalism is that the former says vitality depends on nourishing the entire system, while the latter only worries about money going to the top.

History validates this “money as manure” model, showing that nourishing cross-scale circulation really does make things grow, while concentrating wealth at the top does tend to make the economy stink. For instance, in Inequality for All,[14] Robert Reich shows how nourishing constructive activity creates the virtuous cycle of increasing vitality, while extractive processes – i.e. pulling wealth from the productive processes by reducing wages or burdening people with debt – tends to create a vicious cycle that makes everything go downhill. 

Both of these cycles are well-known. Classical theory points out that, when businesses invest in productive capacity, wages go up and workers have more money to buy things. People with money to spend increase demand, which expands the economy, stimulates hiring, and boosts tax revenues. Government spending on constructive activity stimulates economic vitality even more. For instance, government spending on education increases worker skills and productivity, hopefully,  along with wages. Research by Syracuse University, for example, shows that every $1 spent on public education returns at least $7 of increased economic activity and taxes.

Oligarchic activity tends to reverse this trend. Practices such as outsourcing jobs, cutting wages, and destroying smaller competitors increase the wealth the 1% who own companies and stock, while reducing circulation to everyone else. If circulation drops too much, people’s ability to buy goods drops, which causes demand to drop in demand causes and the economy to contract. The result is a downward cycle of lost jobs, lower wages, reduced consumption, falling demand, and closed businesses with lower hiring, tax revenues and government spending. The resulting economic necrosis can cause economies to crash.

In short , where investment in people and constructive activity increases vitality and public well-being, extraction undermines economic health by sucking the monetary life-blood out of the real economy. Ezra Klein[15] calls this the oligarchic “doom loop.” Wealth buys power, which buys more wealth, and causes a vicious cycle which undermines democracy, systemic health and our ability to learn. Incendiary pressures coming from unmet human needs for food, shelter, health, safety, education and underutilized human-resources, i.e. unemployed or underemployed people unable to purchase essential goods eventually creates a powder-keg society prone to demagogues with dangerous ideas.

Trickle-down policies such as tax breaks for the rich and austerity for the public have produced this vicious cycle in real life. The last 50 years of economic history shows the process.

American comedian Will Rogers coined the term “trickle-down economics” as an irreverent comment on President Herbert Hoover’s attempt to end the Great Depression (1930s) by cutting taxes on the rich. In theory cutting taxes on businesses and the wealthy will benefit society by stimulating business investment. In practice, the superrich use tax cuts to increase their wealth by hiring lobbyists, buying political favors, finding offshore tax-havens, and generally rigging the system to their advantage. So, instead of improving economic well-being, 50 years of research shows that tax cuts for the rich actually reduce employment, the tax base and general well-being.

Research suggests that the Great Depression was actually reversed by massive government spending on: 1) World War II; and 2) New Deal infrastructure projects such as the CCC and WPA. John Maynard Keynes’ explanation of this was that government spending stimulated our economic metabolism by increasing aggregate demand. In other words, having lots of people with money to spend jumpstarted the economy because businesses had a people to buy their goods. FDR’s New Deal also aided the economy by reining in oligarchic excesses by raising taxes on the superrich, encouraging unions and enforcing antitrust laws.

In energy theory, economic vitality grew because money was circulating robustly throughout the entire economy instead of being concentrated in a few hands. In practice, the New Deal’s combination of economic stimuli which increased employment, and oligarchic restraints which reduced extraction, created to an unparalleled 50-year (~1930-1980) expansion of public well-being. The middle-class blossomed, infrastructure expanded, and opportunities multiplied.

This expansion, however, stopped in mid-1970s with the emergence of stagflation, a combination of high prices, high unemployment, low demand, and slow growth. Various people argue stagflation was the result of: 1) unions having too much power; 2) the government printing too much money at too fast a rate; 3) excessive regulations and taxes on business; and/or 4) the sharp increase in an essential commodity – in this case, price of oil skyrocketed because of the OPEC oil embargo. Whatever the cause, the agreed upon solution was a return to trickle-down.

Starting in the early 1980s, Ronald Reagan and Margaret Thatcher promoted a new form of trickle-down called neoliberal[16]economics, which focused on deregulating industry; cutting taxes on the rich; ignoring antitrust laws; privatizing public services and assets; and rolling back New Deal protections, particularly on labor and environment.

In theory liberating large corporations and the superrich will benefit the entire society because businesses will invest in productive capacity, and because business always finds the best ways. In practice, this form of trickle-down has caused a mushroom cloud of misery with outsourced jobs, a vanishing middle-class, obscene inequality, and boatloads of personal and public debt.

Embraced by both Republican and Democratic establishments, this system is now called the “Washington Consensus” because both liberal and conservative politicians give lip service to supporting the working class, while putting trickle-down authorities in charge of creating economic policy.

Why do we put up with this misery-producing system? Paul Krugman[17] notes that the pundit class, which advocates trickle-down policies, are promoting zombie ideas, ones that, “should have been killed by contrary evidence, but instead keep shambling along, eating people’s brains.” For example, the idea that tax cuts for the superrich pay for themselves by increased economic activity was disapproved decades ago.

http://wallstreetonparade.com/wp-content/uploads/2013/10/Income-Inequality-Graph-from-Robert-Reichs-New-Film.png

 

 

 

 

 

 

Figure 1. Excessive concentration indicates an economy nearing collapse

Not surprisingly, zombie ideas continue because they serve to concentrate wealth at the top. According to an Oxfam International study,[18] in 2010 the top 388 richest people owned as much wealth as the poorest half of the world’s population – a whopping 3.6 billion people. By 2019, this number was down to 23 people. The study also showed that the extremely wealthy are also good at dodging taxes, now hiding an estimated $7.6 trillion in offshore tax-havens.

Why should we care about gross inequality? After all, isn’t it natural? ESS says some degree of inequality is natural, but extreme inequality is dangerous because it indicates a vicious cycle underway, with too much money going to the top and too little circulating everywhere else. Extreme inequality, therefore, is a bellwether of an economy nearing collapse. Robert Reich, for example shows that the crashes of 1928 and 2007 followed peaks in which the top 1% owned 25% of the country’s total wealth

Who really rules America? Gilens and Page confirm America is an oligarchy by showing whose preferences Congress responds to. Their study found that policy changes happen about 70% of the time when 90% of wealthy Americans want it, and less than 15% of the time if fewer than 20% of the wealthy support it. The preferences of average Americans had no perceptible impact on policy – except when they match what most elites want.

In other words, gross inequality means oligarchs are in control and an oligarchic “doom loop” is underway. Thomas Piketty’s research (2014), for instance, shows that unchecked capitalism creates a class with so much economic power that it subverts democracy (i.e., government that serves people) by pushing political systems to enact policies that concentrate evermore wealth at the top. The vicious cycle ensues: the uber-wealthy use their political power to buy favors that increase their wealth, which they use to increase their political influence…and so on. A recent study[19] exploring ‘who really rules America?’ shows the result: American is no longer a democracy, but an oligarchy run for the rich (figure ?). As the authors, Gilens and Page, put it:

“When the preferences of economic elites and the stands of organized interest groups are controlled for, the preferences of the average American appear to have only a minuscule, near-zero…impact upon public policy.”

Still, the financial crisis of 2008 seemed to be a turning point. After decades of worshiping at the feet of Wall Street, neoliberalism’s free-market philosophy was discredited, and intelligent, articulate Barack Obama was swept into office in a tidal wave of hope for better way. Obama, however, bailed out bankers, let homeowners and small investors sink, and generally continued the trickle-down policies of his predecessor, albeit in a more genteel form. Why did he do this? The main reason was that the “best and brightest” minds he hired were all proponents of the same trickle-down policies that created the crisis in the first place.

This brings us to the great irony. Despite all the human misery and economic instability caused by liberating the superrich, the trickledown period has mostly spawned populist revolts from the right – under Ronald Reagan, Newt Gingrich, George W. Bush and now Donald Trump.

Why would so many working people vote against their self-interest? The obvious answer is that these Republican leaders managed to channel the anger working people felt by speaking the language of populism: arrogant elites and forgotten men and women whose work was the true source of wealth.

In theory, the Democrats, the party of FDR, should be speaking populist language – championing workers, unions, progressive taxation, and a Green New Deal. In practice, today’s Democratic establishment hates populist reforms, preferring Wall Street money-men and the highly educated, professional “creative class” who they see as their peers and their real base.

The result is unfortunate. Instead of giving rise to a new round of common-cause reform, the pressures caused by ignoring unmet human needs and underutilized human resources are driving the rise of anti-establishment populism and right-wing demagoguesi, ncluding Donald Trump. So what do Donald Trump and Bernie Sanders have in common? The American electorate sees both as anti-elite populists who will shake up the establishment and bring real reform to people’s lives.

What then shall we do?

Oligarchic economies fail because elites concentrate power by draining wealth from the grassroots webs, and then use there wealth to develop ever-better ways to extract wealth, manipulate markets, and rig politics to their advantage. In short, they use money to plunder ruthlessly and consume conspicuously, not to build a better world. Famine, floods, dust bowls and riots follow as societies and ecosystems at home and abroad are plundered to exhaustion.

What then shall we do? The most obvious actions to take include:

Invest regeneratively; circulate robustly; reject austerity. The cure for today’s woes is not more bailouts for the big corporations and Wall Street, but more investment in people, infrastructure, jobs and generally increasing cross-scale circulation. Investing regeneratively is important because economic vitality depends primarily on the energy, intelligence and well-being of the people that do all the work. Promoting “austerity” is a zombie idea that only erodes systemic health even more.

Work towards an equitable distribution of wealth because this increases circulation. Economic circulation doesn’t work if people do not have enough money to buy things it.  Efforts that improve circulation include: a living wage, unions, antitrust laws, and accountability for elites.

Incentivize management to serve the long-term health of the whole, not the short-term interest of elites. CEOs whose rewards are based on stock price, seek to up stock prices with buybacks and by such investor-pleasing moves as cutting wages, benefits and jobs. Managers get raises even when companies go under because wealthy boards and investors get more money from short-term thinking, and because they only care about money, not companies, communities or jobs.

Build public banks. Money moves the world and banking moves money, but today’s private, for-profit banking system is designed to serve the interests of big business and Wall Street, not Main Street. Consequently, the Public Banking movement is one of the most important remedies to this problem to emerge in recent years. Public banks are publicly-owned banks that help realign the channels of monetary flow to serve systemic health and the public interest. Where private, for-profit banks serve the rich, public banks are specifically designed to serve local and regional commercial needs. America’s only public bank, the Bank of North Dakota is a government-owned and operated entity that prioritizes public access over profit, and offers fair banking services to North Dakotans when private banks can't or won't. Access to capital has allowed North Dakota’s medium- and small-scale enterprises to flourish even in times when for-profit money is tight.

Buy local because this increases local circulation via the Multiplier Effect. Multinational corporations are designed to suck wealth up from local economies and funnel them to distant headquarters. Local businesses on the other hand, tend to circulate their money more robustly within the local economy. They hire local accountants, pay local taxes, and are more prone to supporting local communities. The Multiplier Effect measures how many times dollar changes hands within the local economy.

Restore antitrust laws, progressive taxation, and other constraints on oligarchic power because extreme concentration causes a vicious cycles. New Deal reformers’ constraints on concentrated power produced 50 years of unparalleled prosperity because concentrated wealth generates vicious cycles that undermine systemic health. ESS makes this insight measurable by showing how extreme economic inequality indicates an economy nearing collapse.

DISCUSSION: How does today’s doom cycle create incendiary conditions today?

Trickle-down true believers are driving a doom cycle right now. They promote tax cuts for the rich, and austerity for the public. Jobs evaporate, pollution spreads, and insecurity grows. All of this increases profits for owners, while damaging the economy as a whole.

Today’s questions are: how does today’s doom cycle affect workers, consumers, business, and the economy as a whole? How does it fuel the rise of populism, both right and left?

BALANCED, RESILIENT STRUCTURE vs Oligarchic Instability

Discussions of what caused the [Mayan] collapse…pointed fingers at almost every aspect of environment and society simultaneously…Variables were so tightly interwoven and under such general stress that almost every juncture was vulnerable…The most interesting cause of collapse may not be the specific factors that initiated the process but the failing structure that allowed perturbations to amplify throughout the system.

T. Patrick Culbert, cited in Yoffee & Cowgill, 1988

Oligarchic behavior corrodes social bonds, impedes social learning, and hollows-out real economy networks. Consequently, the end of an oligarchic civilization is a systemic affair in which everything seems to go wrong at once. Ecological disasters such as dustbowls and famines and meet economic calamities like disrupted supply chains, and social crises such as epidemics, mass dislocations and internal rebellion.

T. Patrick Culbert’s description of the Mayan collapse (opening quote) attributes the systemic nature of collapse to a failing structure that allowed relatively small disruptions to create a ripple of disasters spreading throughout the whole. In ESS terms, Mayan society had become so brittle that it was susceptible the proverbial ‘straw that broke the camel’s back.’

The Mayans are also not alone. Many societies nearing collapse exhibit similar fragility. This fact explains why System Scientists focus less on identifying a single cause of collapse, and more on trying to understand why the system became so brittle in the first place.

Thinking about fragility has also generated new interest in the concept of resilience, i.e. building networks that stay strong in the face of small perturbations, and spring back easily after shocks. Cities across the world are working to become more resilient to climate-change disruptions by reducing their carbon footprint, planning for disruptions to critical services, and adding redundancy and flexibility to critical processes. Management consultants increase value-chain resilience by adding redundancy, flexibility and standardized interfaces. They also encourage companies to change their corporate culture to create more diverse and flexible arrangements with suppliers and customers.

Many New Economy reformers focus their resilience efforts on rebuilding local economies. This focus makes sense because oligarchic policies have harmed small scale, local economies the most. Many reformers also believe small-scale networks built around diverse local enterprises are more resilient because they have more diverse options.

ESS add a new twist to the resilience conversation. It concurs that resilience tends to increase in-step with the number and diversity of options, and that economies dominated by a few big organizations tend to be brittle because their backup alternatives are limited should any of these organizations go away. ESS’ unexpected twist is an empirical explanation of why economic health depends on maintaining a balance of small, medium and large organizations. It also shows how to use the balance of sizes found in nature to measure healthy balance in economies as well.

The Science

As we’ve seen, the only way for a flow-network to get bigger is to keep small groups connected in an ever-growing meshwork of connective tissue. Large systems, however, eventually develop hierarchical (i.e. vertical) structures because horizontal connections are not enough to maintain coherence, connection and common-cause across very large systems.

These laws of structural growth and development are inextricably wound up with issues of circulation as well. Big, efficient, “vertical”  structures provide the speed and volume needed for rapid circulation across long distances, while small-scale, fine-grained horizontal connections (intricacy) reach every nook and cranny. This kind of integration of systemic needs is embodied in one of nature’s favorite universal patterns, a hierarchical branching structure.

A wide variety of systems – from leaves, lungs and river deltas to ecosystems and circulatory systems– always maintain a particular ratio of small, medium, and large elements[20] arranged in a hierarchical branching structure (Figure 8). Your circulatory system, for example, has a few large, highly efficient conduits branching into successively smaller, more numerous, less efficient conduits below. A healthy ecosystem has a few large predators atop a pyramid of successively smaller and more numerous prey animals. Nowadays, we call these structures “fractals” and use power-law math to measure the balance of sizes needed for health.

A fractal balance of sizes is common because it optimizes circulation across scales, which helps nourish activity at every level. Big, efficient elements (arteries or multinationals) provide the speed and volume needed for rapid cross-level circulation, while the many small elements (capillaries or local contractors) reach every nook and cranny.

Ulanowicz, et al. (2009) uses this same balance to explain the need to balance resilience and efficiency, and how a healthy balance can be measured. Resilience and efficiency both play important roles in systemic health, but these needs must be balanced because the factors that support efficiency (large size, high-capacity, streamlining) are the opposite of those that support resilience (diversity, small size and dense connectivity). Balance is also important because extremes of either cause problems. Too much efficiency creates brittleness, while too much small-scale diversity creates low-energy stagnation. Ulanowicz’ research shows that optimal network health lies in a identifiable Window of Vitality.

The need for balance is easy to see. Big firms with large “economies of scale” are generally more stable, productive and hire more people, but towns dominated by a few large companies are brittle – if a mainstay company leaves, they have no other industries to fall back on. A bevy of small businesses offers more choice and redundancy, but economies dominated by small firms tend to be sluggish because they lack the “economies of scale” to build economic surplus. This leaves overstretched staffs with little money for specialization, expansion, or quality improvements.

The Window of Vitality: Why systemic health requires a balance of efficiency & resilience

Because efficiency and resilience are both important to systemic health, healthy systems must maintain a balance of resilience factors (small, diverse, flexible & densely connected) and efficiency factors (big, streamlined & powerful) within a Window of Vitality representing optimal network health.

Severe economic imbalances also lead to vicious cycles that undermine the health of the whole. The 2008 financial crisis caused by too-big-to-fail banks shows the problem. Domination by a few extremely large, highly efficient corporations creates powerful extractive pulls that siphons wealth from lower levels, and channel it to distant headquarters. These extractive pulls hollow out local economies, erode local diversity, reduce local circulation, and leave fragile and stagnant local networks. Over time, reduced circulation causes economic necrosis – the dying off so much economic tissue that the health of the whole economy declines. In this way, having too many large corporations is akin to having too many large predators.

Fractal logic also explains the need to maintain a balance of diversity/conformity, and flexibility/constraint (i.e. liberty/laws). All of these characteristics are complementary, i.e. they are opposites, and too much or too little of any of them creates problems. Too much conformity or too much constraint makes it difficult to adapt. Too much diversity or too much flexibility makes it difficult to work together in efficient, constructive ways.

Using nature’s optimal geometries as targets for healthy balance in human systems also helps recast our economic thinking in some important ways. Salingaros (2003), for instance shows that that cities work best when their transit systems maintain a healthy balance of small, medium, and large pathways – i.e., walking paths, bike paths, small roads, medium roads and superhighways – because different sized conduits support different kinds of interactions, i.e., exercise and casual conversations to rapid transit.

Goerner et al. (2009) also use fractal structures to explain the Goldilocks Rule of Banking: why economies need banks that are “just right” to meet the needs of each scale (Figure ?). Just as wetlands provide different services than rivers and lakes, so different sized banks are designed to serve different needs. Healthy economies need big banks for large-scale transactions; regional banks for midsized regional needs; and small banks that know the customer and community and are invested in the success of each small-scale loan. Maintaining a proper balance also helps keep big banks from harming smaller ones.

The Goldilocks Rule in Banking: Different sized banks serve different needs. Healthy economies need enough banks that are “just right” to facilitate activity at each scale.

Implications:

Life in the coronavirus makes the need for resilience and balance abundantly clear. What does big and efficient look like when resilience is important? Big corporations increase their efficiency by using just-in-time inventory systems, which among other things, this means that hospitals don’t have extra beds, protective gear and medicines ready in case of a pandemic. While big corporations like Amazon are sucking up wealth hand over fist, thousands of small businesses our going belly up leaving millions of unemployed workers unable to feed their families. Unmet human needs and underutilized human resources are creating huge social and economic pressures which our wealth -serving government doesn’t know how to deal with. For instance, the stimulus that was supposed to help the small businesses pay their workers, was largely sucked up by big companies who have plenty of money on store.

The need for balance and resilience changes classical views in several notable ways:

“Both-And” thinking enhances vitality; “Either-Or” thinking undermines it. Both/And thinking is essential because vitality depends on balancing multiple, critical factors. Like mono-culture crops, either/or thinking is dangerous because emphasizing a single factor ignores critical complements and leads to risky extremism. For example, a world based on balance, means we need both strong individuals and strong bonds that keep them linked in common-cause. We also need profit, wealth, efficiency, and large-size, but we cannot ignore the equally critical components of diversity, resilience, and localized, small-scale fit.

It’s not how big you grow, it’s how you grow big. This idea is a corollary to the laws of growth and development. It says that we can grow large, doing so requires maintaining a balance of sizes and developing sufficiently intricate connective-tissue to keep the entire system functioning as a common-cause whole.

Big is not always better. Trickle-down economists promote gigantism – large, highly efficient systems with huge economies of scale – because they believe large size and high efficiency always makes things better. We now have an empirical explanation of why “too big” undermines systemic economic health. Just as too many large animals create an unstable ecosystem, so financial systems dominated by a few big banks tend towards poor circulation, low resilience, and high instability.

Small is beautiful, but it is often not enough. Many New Economy reformers focus their re-building efforts on local economies because oligarchic policies have harmed them the most, and because they see small-scale networks as being more resilient. Some activists have gone so far as to suggest that big is always bad and small is all we need. While ESS does confirm that local economies with lots of diverse stakeholders often do provide more options, they are also prone to to stagnation precisely because they lack the “economies of scale” needed to weather improve quality, and whether economic ups and downs.

Both is best. Some economists believe large, efficient organizations are best, while others emphasize the small and local. Fractals teach us that large groups actually need the best of both worlds: fine-grained intricacy at the grassroots level and hierarchical structures to coordinate, communicate and circulate across levels. Fine-grained intricacy provides the diverse alternatives that systems need for resilience, while hierarchical efficiency allows the rapid communication and transportation across large distances and multiple scales.

Hierarchy is necessary, but it needs to be done right. Some reformers also argue that we need flat organizations, i.e., ones without any hierarchy at all, because they see hierarchy as intrinsically harmful, particularly to small-scale networks and local resilience. Unfortunately, large groups need hierarchy to maintain communication, coordination, decision-making, and circulation across large distances and multiple scales. So, while small-scale intricacy has many good points, maintaining coordination and coherence in large groups is not one of them. Occupy Wall Street shows the problem. Instead of using hierarchical systems to maintain coordination, the Occupy movement disintegrated because they insisted on flat organizations with consensus built using twinkle-finger hand gestures.

We need to distinguish between healthy and unhealthy hierarchies. If hierarchies necessary, then the problem we face is not with hierarchy per se, but with oligarchic hierarchies whose extractive practices drain wealth from the constructive side of the economy in order to concentrate it at the top. It behooves us therefore to distinguish healthy hierarchies from oligarchic ones. Healthy hierarchies serve the health of the entire system by making sure critical resources and accurate information circulate robustly across levels. Oligarchic hierarchies serve elite interests by extracting wealth, while keeping the broader public in line.

So, while hierarchies are necessary, the only ones that last are those designed to serve the health of the whole. The question is: how do we build healthy hierarchies?

What then shall we do?

The most obvious way to restore resilience and balance is to restore the constraints on oligarchic abuse that New Deal reformers implemented and trickle-down true-believers removed. These reforms include antitrust laws, progressive taxation, the Fairness Doctrine in media, the Estate Tax, and the separation of commercial and investment banking (i.e. the Glass-Steagal law).

Today’s greatest challenge, however, lies in learning how to build healthy hierarchies, ones that truly serve the health of the whole. This project has many aspects, including developing: servant leadership, more distributed power, stakeholder involvement, elite accountability and more constraints on abuse of power. The deeper task is to restore mutual-benefit culture to large organizations long trained in oligarchic mores.

DISCUSSION: How do we build balanced, resilient systems?

Lots of people are trying to build more resilient human systems. Some groups, such as cooperative farm networks, focus on building mutual-benefit networks from the grassroots up.  Others – such as the Mondragon cooperative in Spain, the Democracy at Work group in the US, and the recent push toward employee-owned enterprises – work to build mutual-benefit into large-scale organizations.

Pick an effort to build mutual-benefit networks, and explore the cultural mores they use; the challenges they face; difficulties they encounter; and their record of success and failure. Then discuss your findings with your classmates.

ENLIGHTENMENT 2.0 – Recapturing the Dream; Rebuilding Our World

Four score and seven years ago,  our forefathers brought forth a new nation conceived in liberty and dedicated to the proposition that all men are created equal. Now we are engaged in a great civil war, testing whether that nation, or any nation so conceived and dedicated can long endure… It is for us the living…to be dedicated to the unfinished work… that this nation… shall have a new birth of freedom – and that government of the people, by the people, and for the people shall not perish from this earth.

Abraham Lincoln, the Gettysburg Address, 1863

Global civilization is now struggling to learn its way out of oligarchic capitalism’s many debacles. Some groups seek to repair environmental damage. Others work to mend social wounds, create better business processes, organize constructive social change, and figure out how to constrain oligarchic abuse in politics, finance, and large-scale business.

Still others work to reform the economic and scientific belief systems that support oligarchic behavior. Economic reformers are particularly important because oligarchic capitalism is killing us. Our survival now hangs on developing a combined theory of social and economic vitality that accurately explains how to generate well-being for everyone, not just wealth for a few. To be realistic, this theory should see people and human organizations as the engines of prosperity and learning. To be effective, it should be mathematically rigorous, and fit the facts of human systems we see both historically and every day. To succeed, it must explain what’s wrong with oligarchic capitalism while providing a commonsense account of what would be better. What kind of science could possibly support all of this? ESS is in the process of answering this call.

ESS’ role in today’s change bears an uncanny resemblance to the shift from medieval to modern pattern of society, which took place some 400 years ago. Back then, new tools expanded scientific abilities and gave rise to a new reason-based understanding of the cosmos. This Scientific Revolution, in turn, provided a framework for Enlightenment reformers working to establish a new dream on which to build a new world.

Much the same is happening today. Now as then, new tools have expanded scientific abilities and produced a better understanding of the cosmos. Now as then, thousands activists responding to the pressures of their time, are rising up all over the world and in every field imaginable – agriculture and energy to finance, politics and urban planning. Now as then, the new scientific worldview provides a framework for reformers seeking to establish a new dream and build a new world.

We call today’s upsurge, Enlightenment 2.0, because the dream these reformers are trying to establish is actually a rebirth of the original Enlightenment quest for free-enterprise democracy. Now as then, we seek enterprise that is free from oligarchic domination; and “government of the people, by the people and for the people,” as Lincoln so beautifully put it. It likewise calls all now living to dedicate ourselves to rebuilding our world around a new birth of liberty, equality, justice and reason, now given new substance by science’s new vision of humanity and the world.

Recapturing the Dream

Our four pillars – collective learning, collaborative culture, regenerative circulation, and resilient structure – can help us recapture the dream by changing the way we see the world.

This recapture starts by reframing today’s right/left political-economic debate. This debate is usually framed as a choice between free-market capitalism and government-run socialism, but since oligarchic beliefs can corrupt both private organizations and public institutions, we believe the real question is how can we develop public and private systems that truly serve the wellbeing of the entire society, not just elite wealth and power. In other words, the real debate is how do we build:

Learning to build a free-enterprise democracy that truly serves all the people is also going to require some new terms. Lacking other language, we will use Franklin Roosevelt’s distinctions:

Capitalism is an economic system in the private sector, not a form of government. By nature, it has no social conscience. Government run by capitalist bosses for their own benefit is fascism! Democratic Socialism is government in the public interest that regulates the excesses and abuses of capitalism.

In these terms, today’s debate is between oligarchic capitalism and social democracy, i.e., government that uses the best available evidence to maintain the health of the whole society. Denmark is a good example of a social democracy with relatively fair and just free-enterprise. America is a good example of oligarchic capitalism run by an elite-serving government.

ESS also helps heal the rift between right and left by separating the wheat of the original free-enterprise vision, from the chaff of oligarchic distortions. For instance, diversity’s role in filling niches and finding new ways confirms why today’s free-enterprise proponents rightly honor the mavericks, rugged individuals, and innovative, entrepreneurial individuals who build a better world. The importance of constructive activity also explains the importance of hard work and contribution. Here, “competition” again becomes striving for excellence on a level playing field, not economic predation supported by government favoritism.

Yet, while ESS honors strong individuals, it also restores the common-cause communitarian backdrop which lay at the heart of the original free-enterprise vision. Adam Smith, for instance, is credited with articulating free-enterprise’s founding vision in The Wealth of Nations (1776), but his earlier work, Treatise on Moral Sentiments (1759), placed it in a moral context that specifically emphasized the importance of human “sympathies” for others.

Understanding “sympathies” highlights a key oligarchic distortion. Smith, like other classical economists, was concerned with freeing enterprise from oligarchic elites (called the “rentier” class), not liberating markets via deregulation, which is a euphemism for making markets more open to oligarchic abuse. So, where today’s oligarchic capitalists see “freedom” as liberating the powerful to plunder as they please, classical thinkers like Smith saw it as liberating people from oligarchic oppression.

The big question, of course, is: how do we achieve a durably vibrant, community-serving, free enterprise democracy? At least some of the answer can be found in reforms already emerging. Next several sections explore some movements heading in the right direction.

Built to Learn: The power of common-cause community and distributed empowerment

The law of collective learning says we need organizations that harness their entire collective intelligence, not just a bit. The law of common-cause community says we need to build organizations around reciprocity, not selfishness from the top down. The law of balance says we need a fractal distribution of power spread across all levels and organizational sizes.

Each of these laws can be seen, sometimes in part and sometimes in whole, in a variety of movements, both long-standing and recent. A number of groups, for instance, are rebuilding stakeholder networks from the ground up by linking individuals and small groups into large organizations with “economies of scale” for such issues as purchasing and distribution. This is particularly common in food networks. Organic Valley Dairy, for example, began as consortium of independent farmers that banded together to build more efficient distribution, advertising, and purchasing systems than any could handle alone. They also share information about best practices and standards.

In fact, some of the most powerful economic networks on earth consist of numerous small, high-quality firms linked by a natural pattern of cooperation and niche building. Sabel, for example, describes Northern Italy’s manufacturing network as built of: “innumerable small firms in a great cluster of small industrial cities between Bologna and Venice in northeastern Italy.” These networks are ‘flexible’ because invention, adaptation, and creativity are everyday affairs.

A small shop producing tractor transmissions for a large manufacturer modifies the design to suit the need of a small manufacturer of high-quality seeders. In another little shop a conventional automatic packing machine is redesigned to fit the available space in a particular assembly line...A membrane pump used in automobiles is modified to suit agricultural machinery (Sabel, 1982a).

Such networks achieve tremendous economies of scale not, as conventionally assumed, within the framework of huge organizations, but rather through large symbiotic collections of small enterprises. Most have only 5 to 50 workers, with a few more having one or two hundred. Because they are small, cooperative, and still connected to one another, such enterprises also tend to produce very sophisticated and high quality work. Innovation is high because personal creativity is a central theme and because partnership norms and a craftsmanship ethic are still valued. Quality is high because people care about integrity as well as profit. Creativity is high because workers and ideas circulate. Such circulation builds expertise, breadth of experience and an invisible chain of valued human connections.

Such webs tend to develop naturally because breakaway enterprises spring up easily as workers trained by existing enterprises start new firms of their own, while retaining the past connections. Such spin-offs often collaborate with the older establishments because they share history and have related work. People in the network develop their own ‘genius contribution,’ while information, expertise and workers cycle easily throughout. Members prosper in a synergistic, not a zero-sum way because advances anywhere tend to stimulate benefits everywhere.

Fractally-distributed intelligence improves resilience in corporate conglomerates as well. Watts’ (2004) description of the 1997 Toyota-Aisin crisis is a case in point. Toyota is actually a confederacy of over 200 companies linked by the Toyota Production System (TPS).  While TPS emphasizes collaborative relationships, not competitive one, by 1997 one of its companies, Aisin-Seiki, had become sole supplier of P-valves, a device required in all Toyota vehicles to prevent rear-brake skidding. Crisis struck in 1997 when the Aisin-Seiki plant burned down because its just-in-time inventory system left only a two-day supply of P-valves. Yet, because the TPS worked like a flexible-manufacturing network, within three days after the fire, other TPS companies began producing over 100 different types of P-valves ─ all without any central direction or control. Watts suggests that TPS fixed itself rapidly, without top-down plans, because its network of social ties kept the system intact and products flowing, while its endorsement of flexibility and rapid invention promoted adaptation on the fly.

The Mondragon Industrial Cooperatives of northern Spain provide a more intentional version of an integrated, common-cause community taking place on a large-scale. Here, economic and social well-being is achieved by linking local economic units based on stakeholder ownership with social support institutions like schools, hospitals and banks. Founded in 1956 by a parish priest in a poverty-stricken region of northern Spain, Mondragon has three defining features. First, only current workers are allowed to be owner-members; each buys a share in the cooperative’s ownership, which is returned at retirement or termination of employment. Secondly, Mondragon’s culture emphasizes individual responsibility, common-cause cooperation and making decisions at the lowest level possible (subsidiarity), which eliminates the need for a lot of middle management, and keeps management overhead low. Thirdly, management is seen as a shared, fiduciary responsibility to serve the social and economic health of the whole community. All workers have a voice in policy and operations, either directly or indirectly through designated managers. Managers actively promote distributed empowerment and learning, which helps Mondragon adapt rapidly, while maintaining unusually high levels of productivity and income for all its members. Benefits include a network of excellent social services, including schools, housing, welfare services, and banking. (Whyte & Whyte, 1988; Morrison, 1991, 1995)

Starting as a 23-person workshop for making stoves, by 1980 Mondragon had 70 factories, an extensive primary, technical and university educationsl system, and a credit bank with 93 branches and 300,000 deposit accounts. By 2015, it employed 74,335 people in 257 companies involved in four areas of activity: finance, industry, retail and knowledge.

An increasing number of organizational consultants are also concluding that partnership improves organizational intelligence and resilience. For instance, after years of researching what made some companies great for long periods, James Collins and Jerry Porras (1994), authors of Built to Last: Successful Habits of Visionary Companies, came to two conclusions:

Thanks to such consultants, a number of corporations are beginning to realize that the best way to maintain their competitive edge is to harness their organization’s entire internal intelligence. In the late '80s, for example, Chrysler began supporting the flow of information between teams by encouraging “tech clubs,” unofficial bands of like-minded individuals who got together to swap experiences and expertise. In Cultivating Communities of Practice, consultants Etienne Wenger, Richard McDermott, and William Snyder (1999) describe how companies can purposely develop such groups as a way of increasing organizational performance. As they say:

Businesses are embracing network-based forms of organizing to build new capabilities, accelerate innovation and increase agility in the workplace… “Communities of practice” (CoP) are informal networks of employees who connect to solve problems, share ideas, set standards, and build tools.

Build High-Value Capitalism

Experiments in building common-cause enterprise networks are also meeting up with pressure coming from another direction. Oligarchic capitalism and mass-production industrialism are reaching their limits. Extractive practices cause economic necrosis; oligarchic inequity generates social and economic tensions; and top-down hierarchies are too slow to handle today’s pace of change and level of complexity. Head-to-head competition over the price of uniform mass-produced goods has been creating a race to the bottom, with lower wages, lower quality and lower prices going hand-in-hand for years.

In his book, The Work of Nations, former secretary of labor Robert Reich (1991) shows how these interlocking crises are quietly driving a new era of “high-value” capitalism built around more creative, committed, partnership teams. Slowly, through trial-and-error, the companies that are thriving today are shifting from mass-production of uniform goods to serving the unique needs of particular customers. Whether the industry is old-tech or high-tech, service or manufacturing, the pattern is similar. Steel-making’s greatest profits no longer come from long runs of steel ingots, but from creating particular alloys with particular properties that serve particular needs – such as the strength and flexibility of helicopter blades. The fastest-growing truck, rail, and freight businesses meet shipper’s needs for specialized pickups and deliveries worldwide. The most profitable financial services create custom blends of banking, investment, management, and information for specific types of people. The highest profits in software come from customized services to particular businesses and individuals.

High-value businesses are lucrative because customers are willing to pay a premium for goods or services that exactly meet their needs. They prosper because high-volume competitors around the world find it hard to duplicate the uniqueness and quality of customized goods and services. Customization also opens millions of niches in which the biggest differentiators are quality and innovation. As in nature, the economic ecosystem stays strong by building quality within an endless array of specialty slots.

Where traditional industrialists valued material assets like factories and saw workers as disposable drones, high-value companies treasure human capital – the knowledge, creativity and team-working skills of its people. As in nature, high-value vitality springs from common-cause relationships and give-and-take flow between talented individuals who produce more together than any one of them could produce alone.

Such enterprises are not commodities that can be acquired like a factory, but human webs that must be nurtured and developed by the kind of guardian leadership described earlier. Reich cites the experience of General Electric when it purchased the financial-services house of Kidder-Peabody in 1986. Kidder-Peabody was known for its quality and creativity, but talented people often leave when new owners try to restructure relationships along traditional lines. When GE tried to exert control over its new acquisition by imposing stricter reporting requirements and tighter accounting costs, many of Kidder-Peabody’s most skilled people left for more agreeable surroundings. GE was left with little more than Kidder-Peabody’s good, but fading name.

Naturally, managing high-value human capital requires approaches that are more facilitative than controlling, more reciprocal than classist, and more responsive than blindly bureaucratic. Here, “roaming and flocking” is encouraged because creative syntheses tend to emerge fortuitously from frequent, informal exchanges. Teamwork is promoted because no one figures everything out alone, and distributed empowerment is used because making decisions at the lowest level possible (subsidiarity) is much more efficient than always waiting for top-down control from some distant HQ. Formal ranking and corporate pigeonholing work against all of this, as does bureaucratic rigidity, pay inequity and abusive power. Formal meetings are often a waste of time.

Computers make these more nimble patterns of organization feasible, while global connectivity and long-distance management make them more necessary. The last thirty years have brought increasing levels of both global connectivity and economic uncertainty. Most corporate headquarters are facades for a complex web of contractors, subcontractors, subsidiaries, allies, etc. Worked diffused work all over the globe, means companies called German, French, British or American are less and less so. Foreign parts fill assemblies; foreign workers constitute a large percentage of the work force; and foreign companies own part or all of what are ostensibly national companies. Indeed, parts, work and ownership are so mixed that it is often hard to tell what the dominant nationality is.

Empowering Education

Naturally, high-value culture promotes a host of other changes too. For instance, the traditional “factory model” of education won’t work for the emerging world because quality human capital cannot be stamped out by cookie-cutter molds.

In high-volume days, companies needed factory workers whose chief characteristics were the ability to read and follow directions. Traditional education did well by this need. It stuffed facts into young brains, taught discipline, conformity and the ability to work alone on isolated tasks. It also encouraged the competitiveness that was thought to make all things good. Yet, with the high-value age, all these needs are reversed. Teamwork is critical as originality and the ability to make connections across fields. Commitment to one another is often the saving virtue of a team and the chief virtue of a high-value leader is the knack of helping others become successful. Traditional education tends to stomp out all of these characteristics.

By the 1990s, the sense of crisis in the schools was growing as test scores dropped. Yet, not understanding the nature of the high-value world, many reformers called for a stronger version of the old. More tests! More uniform curriculum! More discipline! More competition! As Reich says, “The fact that standardized tests only reflect a student’s ability to regurgitate facts ─ as opposed to think or collaborate ─ remained an unmentioned topic.” The fact that factory-like schools also make learning fragmented, meaningless and odious also goes unmentioned.

The yuppies who already dominate high-value jobs, however, don’t want any of this for their own children. They pour their money and children into elite private schools and advance-track programs where young minds are trained to be skeptical, curious, creative and collaborative. Here the curriculum is integrated, interactive and communal. Instead of regurgitating pre-packaged bits of history and biology, the focus is on learning to think and connect. Students learn to examine reality from many angles and to ask why some facts have been emphasized and how current interpretations might be contradicted. The best classrooms also make learning a group project. Students learn to listen to others, to seek help and to give credit. They learn to articulate the patterns they see and to clarify and restate for one another. The resulting benefits are more profound, if harder to measure. Students learn to value themselves and others and to feel the pride that comes from contributing to a committed, intelligent and noble whole.

The most striking result is better learning, in more dimensions, for everyone. The long-term effect is actually a new appreciation of how vibrant human capital creates healthy human systems. Human systems are most creative when they are collaborative. They are the most intelligent when they are inclusive, equitable and committed to common cause. Developing high-value communities and economies will not be easy because it requires profound social and educational reforms. Yet, the benefits would be dramatic. Our children might find more hope and more meaningful work. Quality, creativity and two-way commitment might be more valued than obedience and expedience. Because customization opens the door to endless niches, if we can figure out how to link niches through cooperation, we might finally have a sustainable world.

Push political-economic reform

Oligarchic capitalism’s political influence stands as a huge obstacle to this new stage of the ancient dream of health, happiness and well-being for all. Because oligarchic practices destroy real-economy networks and the societies that depend upon them, we must figure out how to take back democratic power and overturn oligarchic policies. Some of the more obvious policies we need to implement include:

Still, all the policy remedies in the world will not save us if we do not create corporate cultures that support practices that improve societal health, rather than undermining it. Today’s most daunting task is to figure out how to build common-cause mores and Guardian principles back into the leadership circles and corporate hierarchies that run our world.

Find a new “spiritual spur”

New dreams require a deeply motivating drive, a desire that Harvard sociologist Pitirm Sorokin called a “spiritual spur.” This is not a religious motivation per se, but rather a noble cause which inspires people in all walks of life to dedicate their lives to building a better world. Romans sought to build a just Republic. Medieval people sought to build God’s city on earth. Enlightenment reformers sought to build modern society around liberty, equality, democracy and the Rights of Man.

What is our spiritual spur? While resilience, regeneration and common-cause learning are desirable, I doubt they offer the kind of inspiration needed to inspire people in all walks of life to build a better world. So, by way of an alternative, I will also point out some of the spiritual implications of an energy-driven cosmos.

The Darwinian worldview is destructively dismal; it sees a purposeless world of colliding particles populated by people who care only about money and themselves. In contrast, the study of energy makes the spiritual wisdom of the great sages a matter of both science and the everyday world. It says, for instance, that everything in the cosmos, from the first bits of matter to the magic of consciousness, was created by an omnipresent, creative force that still guides us today. This ineffable force is: “in us, of us, and more than us,” at the same time. It didn’t put us in this world to be selfish; it designed us to be creative, collaborative and to live in harmony with all beings in our wondrous world. The incredible binding intricacy creates teaches us that, “the Many are One, and the One is Many.” Over time, it rewards those who build and learn, more than those who steal.

These facts change the way we feel about ourselves and our world. It specifically offers hope,  while making our direction clear. We can build a better world. We are designed to do so, and we have done so many times before. All the great societal reforms – Rome’s Republic, God’s Design, and modern Reason and Rights – were products of oligarchic crises that drove previous great change. Now it’s our turn.

THE NEXT STAGE OF CIVILIZATION

The money changers have fled their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. The measure of that restoration lies in the extent to which we apply social values more noble than mere monetary profit.

Franklin Delano Roosevelt, 1933.

Science cannot predict whether we will learn in time to save ourselves, but at least the rules we need to rebuild our world are clear (measurably so). 

History also gives us hope. In 1632 Galileo Galilei book, Dialogue Concerning the Two Chief Systems of the World used evidence from the latest technological wonder (the telescope) to explain why the Copernican view of a sun-centered solar system was more accurate than the traditional Ptolemaic earth-centered universe. This shift in scientific vision shook the establishment’s vision as well, which is why Copernicus is still famous today. Much the same appears to be happening today, only this time it is Homo Economicus and the selfish gene theory of evolution that are about to appear hopelessly inadequate, inaccurate and socially destructive.

We leave you, therefore, with two contemplations. First, the truths we are pursuing are ancient ones, now clarified by the most sophisticated science humanity has ever created.

Secondly, if today’s great change succeeds, the next stage of society will be as different from modern society as modern society is from the medieval world. So imagine, in this stage, self-serving power will no longer rule our world and run our civilizations into the ground. Our children will be taught to think, and well-informed citizens will have impact on policy and politicians. Our governments will serve all the people, and their policies will help workers and small businesses thrive along with society as a whole. Pursuit of human harmony and spiritual truths will be a honored, everyday affair, not the separate province of religion.

This change will not happen overnight, but these possibilities are worth working for.

 

 

[1] Energy System Sciences is an umbrella term for disciplines that use the study of energy flow networks to understand the laws of systemic health, growth and development in living, nonliving and supraliving systems. ESS disciplines include: Chaos, Complexity, Resilience, Ecological Network Analysis, Self-Organization Theory, Nonequilibrium Thermodynamics, Panarchy, and others.

[2] We use Energy System Sciences (ESS) as an umbrella term for disciplines studying the laws of health, & development emerging from the study of energy-flow-networks. Disciplines include: complexity, chaos, resilience, nonequilibrium thermodynamics, ecological network analysis, self-organization theory, Panarchy, and others.

[3] Cited in The Secret History of the American Empire, by John Perkins, 2007, p. 160.

[4] Rutger Bregmann, 2019, YouTube video: A Utopian Dream for Realists.

[5] Odum (1971, 1984), Hannon (1973), and Costanza (1984), for example, have all used energy theory as the basis for understanding economic operation. Georgescu-Roegen (1971) used it to create a thermodynamic theory of economics while Daly used it to urge a steady-state view (1973) and a focus on the socio-economic infrastructure needed to undergird structurally stable growth (1997). In fact, according to Kenneth Boulding (1981), many early economists held energy views, until those who favored Newtonian mechanics channeled economics towards today’s familiar mechanics of rational actors and the reliable self-restraint of General Equilibrium Theory, which now dominate the academic literature as well as the boardrooms and political venues of the world.

[6] YouTube video: Nick Hauer at the 2015 GeekWire Summit.

[7] https://www.politico.com/magazine/story/2014/06/the-pitchforks-are-coming-for-us-plutocrats-108014

[8] Daily Kos, The pitchforks ARE coming: A billionaire warns his fellow oligarchs, 2014

[9] Intricate structure is inseparably linked to work capacity and energy-circulation speed. Because intricacy measure matches increased ability to do work and circulate energy, we can use it to assess the degree of “development” as an increased ability to do work. Chaisson, for example, shows the same progression of intricacy, capacity and speed, marks the succession of ecosystems from grasslands and pine forest to oak forests, and the progression of increasingly complex human societies from early agriculture through modern industrial.

[10] https://grassie.net/the-great-matrix-of-big-history/

[11] https://fractalenlightenment.com/18685/fractals/fractals-a-part-of-african-culture

[12] Friedman, Milton. 1970. The social responsibility of business is to increase its profits. The New York Times Magazine, September 13, 1970.  Italics added. Quotes around the word "responsibly" were in in the original.

[13] Robert B. Reich. 2020. The system: Who rigged it and how to fix it. Inequality media. YouTube video.

[14] 2013 Documentary film, http://inequalityforall.com/

[15] Ezra Klein, April 11, 2014, The doom loop of oligarchy. Vox. https://www.vox.com/2014/4/11/5581272/doom-loop-oligarchy

[16] This system is called “neoliberal” because it ‘liberates’ free-marketeers to plunder as they please.

[17] Krugman, Paul. 2020, Arguing with zombies: Economics, politics, and the fight for a better future.

[18] https://www.oxfam.org/sites/www.oxfam.org/files/file_attachments/ib-wealth-having-all-wanting-more-190115-en.pdf; https://www.oxfam.org/en/pressroom/pressreleases/2015-01-19/richest-1-will-own-more-all-rest-2016

[19] Gilens, Martin & Page, Benjamin. 2014. Testing theories of American Politics: Elites, interest groups, and average citizens Cambridge University Press; London. DOI: https://doi.org/10.1017/S1537592714001595

[20] This ratio is always a power-law, meaning a geometric progression (xn). Your lungs, ecosystems and fractals all exhibit power law ratios, which means that, moving from the top down, each scale (N+1) has X times as many elements as scale (N). For example, if the top level (N=1) has 3 people (X=3), then the next level down (N=2) would have 32 =9 and the 3rd would have 33 =27.

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