The Revolution...Sorry, Transformation Starts Now!

Originally published in The Huffington Post on March 10, 2011

I predict the Naked Power Grab by the Republican party in Wisconsin will go down in history as the second "shot heard 'round the world" which began the second American Revolution. Except, if the Progressive Movement in America really wants to win this Revolution, it will not launch a revolution at all. It will launch a Transformation. The Transformation of America (and, ultimately, the world).

I insist that Progressives follow my reasoning, below, because -- in today's world -- the Freedom Fighters (i.e. us non-super rich, non-social Darwinist folks) are way outgunned in a traditional sense. In other words, there is no way Progressives can win a traditional, head-to-head confrontation with the Right.

Only asymmetrical warfare by Americans interested in Real Progress (i.e. progress that is Inclusive... even including the wealthy) will win this war.

And in my opinion, this warfare will have to be on the order of what Gandhi did. In other words, nothing violent that would give the rich and powerful cause to say they were justified -- as a worst case scenario might merit -- declaring Martial Law.

Rather than attempting to "storm the castles with torches," I foresee initially something on the order of massive numbers of people disengaging from (taking power away from) the system. No more buying anything made by corporations that support the behavior seen in Wisconsin might be a good beginning. Maybe a work stoppage nation-wide to begin giving ordinary people a sense of being connected... of having personal power because of those connections.

But this People Power must be channeled into doing more than what organizational development experts refer to as Stopping Bad Stuff. Ultimately, this power must be channeled into Starting Good, New Stuff.

This is pure systems thinking. You want to eliminate what doesn't work. But that doesn't get you to a new place. It gets you to a "less bad" place, but not a really new place.

Therefore, for this Revolution to play out successfully... for it to get America (and the world) to a truly Better Place... it cannot to be a Revolution at all. It must bring a truly new America into being. It must be a Transformation, not a Revolution.

Historically, people as diverse as Presidential Medal of Freedom winner, inventor/philosopher Buckminster Fuller and legendary management theorist and systems thinking pioneer W. Edwards Deming have publicly stated that a Transformation in American (and global) society is needed... a Transformation to a new world view based on the principles of abundance, not scarcity. This is the $64 Trillion question. Can America's Progressives learn that shifting from scarcity to abundance thinking is the name of the game here?

The war the Right is waging is based on the Darwinian/Malthusian based fear that there isn't enough in the world for everyone. As a result, the Right is organized around the aim of making sure that only those who are just like them "make it". And the rest of us be damned.

That scarcity-based world view has been scientifically demonstrated to be obsolete, but it's very rare that the public hears about this. The sustainability sciences have proved that it's possible to feed, clothe, house, and educate every man woman and child on Earth, but those in the know have yet to pull off the necessary marketing effort to make this historic breakthrough the Front Page News it deserves to be. (More on that in a future post.)

One key aspect of this science is tapping the free and unlimited supply of energy coming from the Sun. Plants already do this. Humanity can too.

It is this Transformation -- from scarcity to abundance thinking (with the resulting design, development, and implementation of a society based on that fundamental principle of abundance) that the Progressive movement in America should work towards.

Forget about the talk by many on the Left of a "limited resources" planet Earth. That view is because those people -- when thinking about our energy needs -- are, literally, only looking down... at the Earth. If they only looked up, they would see the Sun in all its free energy glory! (Sorry Jeffry Sachs. Your world view is actually obsolete. I highly recommend you study Bucky Fuller and Dr. Deming's work.)

This is the path that can lead Progressives to success over the forces on the Right. While the Right is fighting old, obsolete battles based on fear and division, Progressives will be building a hopeful, optimistic, and very appealing better world that will both create "heaven on Earth" and will take away the fear-based power the Right is currently using to drive its movement.

Eliminate fear, my fellow Progressives. That's what the people in Egypt did. And when they were no longer fearful of the power structure in their country, they were able to dismantle it and begin to build a much better country... one that will work for everyone in Egypt, not just the wealthy.

We American Progressives can do the same, except that America's position in the world will mean our work will eventually help fulfill an even greater human dream... of a WORLD (not just a country) that works for everyone!

Here's to winning the war by refusing to play on the Right's battlefield or using their rules!

Here's to winning the Revolution but not "revolting" but by "transforming" (building something better) instead!

****

A post-script from the world of business:

Business leaders such as Steve Jobs know this transformation principle very well. You put your competitors away not be fighting them head-to-head but by inventing something so new and exciting that you Win Through Innovation. The book Blue Ocean Strategy was a huge, global best seller in business circles, because it presented this approach as well: winning without fighting... by leaving your competitors in the dust by offering people something better that no competitor was offering.

I will be attending The Economist's conference on Innovation later this month in Berkeley. The conference program says "The summit will attract executives who believe in the power of innovation to transform our businesses, our lives and our planet."

I will be engaging people there on the challenge of transforming all of society... what Bucky Fuller and Dr. Deming advocated. And I have a public education plan I will discuss that could move this process into the civic conversation in a big way. It's based on the little known 1955 partnership between Walt Disney and Wernher von Braun which taught the American people that space travel was now scientifically possible.

Update from The Economist's Innovation Conference:

Through a process that required that I "campaign" for support from the other conference attendees, I got to lead a session on using innovation to create Global Peace and Prosperity. This was a real breakthrough in my experience of how people will respond positively when presented with this option as one of their "what to think about" choices!

Russell Ackoff, "Einstein of Problem Solving," Has Died

(Originally published in The Huffington Post on Sunday, November 1, 2009)

The world lost a very great man this past Thursday. So great, in fact, that the only person I can compare him to is Einstein. And that's because this man - Russell L. Ackoff, Professor Emeritus of The Wharton School - transformed the world of problem solving just as Albert Einstein transformed he world of science. Russ was my friend and mentor for the last 10 years and was 90 years old when he passed away from complications resulting from hip replacement surgery. His official obituary is here.

Why I compare Russ Ackoff to Albert Einstein

Before Einstein and his fellow physicists made their discoveries early in the 20th Century, the scientific world assumed that our universe was - essentially - a "giant clock". This mechanical view of the universe was made obsolete by the discovery of Quantum Mechanics, through which the universe was redefined as being an interrelated and interconnected series of waves... of patterns of energy. (I'm using short-hand language here.) The bottom line: computers could not exist without Quantum Mechanics, because its principles make possible how computer chips work.

Mechanical view of the universe... no computers. Quantum Mechanics... computers (and a whole lot more). It's that simple.

Well, before Russell Ackoff and his fellow organizational development theorists made their discoveries in the period following WWII, the management world assumed that solving the problem of how to make organizations work better required using Analysis: breaking the problem (the organization) up into its component parts... fixing those parts (including "those people") that were broken... and putting the organization back together, with the expectation that it would then work. This was also a "giant clock" philosophy.

This mechanical view of problem-solving was made obsolete by the development of Systems Thinking, through which making organizations work better was redefined in recognition of the role played by the design of the entire system. Synthesis - the thinking method involving seeing how different elements in a system interact with each other - replaced Analysis as the method of developing breakthrough operational improvements (otherwise known as Innovation).

Innovation comes from looking at whether an entire system can be transformed, not if certain parts of a system can be improved. You don't get from a car to an airplane by just looking at how the car's engine works.

The work of Russ Ackoff and his colleagues codified what had previously been done by people who were innovators naturally (inventors, for example). Previously, how these people thought was not a formally recognized thinking discipline.

Why All This Matters

If you don't think codifying the thinking used by inventors matters, here's why it does:

You may not get from a car to an airplane without thinking this way. But you won't get from a nation that is failing to solve the many crises it faces to a nation that is healthy and provides an environment in which its citizens can prosper without thinking this way either.

In fact, it is Einstein himself who once said..

"The specific problems we face cannot be solved using the same patterns of thought that were used to create them."

Russ loved that quote.

Currently - in the course of trying to solve its numerous, critical problems - America is tearing itself apart. And that is because - technically speaking - it is using Analytic Thinking in its efforts to do so. American needs to look at the larger system - in this case, the larger sociological culture - in which all of its separate problems exist. That is the only way America is ever going to solve its problems once and for all.

It is possible to solve the many crises America faces. It is possible to not just solve but dissolve our crises in education, health care, job creation, etc. But we won't do so if we keep trying to solve them the way we have... separately. We must solve them in the context of redesigning the larger sociological system in which they all reside.

And this is why I am urging all of you to explore the life's work of Dr. Russell Ackoff - and that of the other systems thinking theorists with whom he worked - on this, the occasion of his death. There is no more critical thing "we, the people" can do for the long-term health of our nation than to reorient how we approach solving our problems.

We must learn to think differently!

Russ Ackoff knew that the true solution to a problem can only be found by examining the design of the larger system in which the problem exists... and then correcting that design to eliminate the flaws that generated the problem in the first place. This "start with the whole and work back down to the broken part so you know *why* the part is broken (not just *that* the part is broken)" is a radical and upside-down way of thinking, but it works!

Analytic view of problem solving... problems persist. Synthetic/Systemic view of problem solving... problems dissolve, never to return! It's that simple!

Problems Dissolved, Never To Return

"Problems dissolved, never to return? What are you talking about? If such a thing were true, how come I haven't heard of it before? If Russell Ackoff - and no disrespect intended... may he rest in peace - helped develop such a miraculous way of solving problems, how come he isn't as famous as Einstein? In fact, how can you compare someone who's unknown to someone as famous as Einstein?"

I'm sure many of you are thinking some variation of the above thoughts.

And let me say for the record that the nearly 60 year history during which a critical mass of the American public - or, at a minimum, of the American public's political/civic leadership - never learned that this body of knowledge exists is one of the greatest cultural developmental failures I have ever known... but one I have come to understand in the following terms:

Only when disaster strikes do cultures make significant changes in how they view what they are doing... in how they organize themselves to create a future that's different from their past. That disaster can be economic (The New Deal grew out of The Great Depression) or military (Japan's non-violent constitution grew out of it losing WWII) or a combination of both (Nazi Germany grew out of Germany's loss in WWI and its economic crisis - linked to the global economic crisis - in the years immediately after). Please note: I didn't say all such changes are for the betterment of the global situation. I only said that disasters produce change.

Einstein and his colleagues benefiting from the fact that they were working within a field - physics - that accepts new knowledge once that knowledge has been sufficiently proven. Plus, when it comes to reaching a critical mass of political leaders, they benefited from their research leading to the development of the Atomic Bomb. In a cruel twist of "public marketing fate", the deaths of hundreds of thousands of people from the use of The Bomb - when combined with its unique visual qualities - made it part of the public's consciousness in a significant way.

So, the world of physics was permanently changed. And Einstein's name became known to people throughout the country... and the world.

Russ Ackoff worked within a field in which no such "replace old theory with new" process exists. Old management processes continue to coexist with the new. As I related in my recent Huffington Post essay about why President Obama should listen to the late Peter Drucker rather than General McChrystal, most of us grow up in an autocratic management world called "the family", which doesn't help when it comes to creating a critical mass for change.

But this 60 year long "failure to communicate"may be coming to an end. And not, specifically, because Russ Ackoff has passed away (although I am determined that his passing receives the attention from the press that it deserves).

No, the end to Systems Thinking's long period of isolation in an intellectual wilderness may come because the United States appears to be headed for the kind of crisis that has brought about large-scale change in the past.

As I said above, America is tearing itself apart.

As Frank Rich reports in today's New York Times, the Republican Party is progressing steadily down a "road to purity" (led by people such as Sarah Palin and Glen Beck). This will further destroy the already nearly non-existent partnership that exists between the two sides of "the house of America". And as President Lincoln said, "A house divided against itself cannot stand." I don't care what the DOW does or what the GDP numbers are in the next quarter. (And please note: BusinessWeek doesn't appear to care about GDP numbers that much anymore either. See "The GDP Mirage" in the latest issue.)

It's the health of our socio-political fabric that determines whether a nation avoids a catastrophic crisis or not. And right now, that health is dropping rapidly.

So, the stage is being set for when America will finally be ready for "a new way". I only hope that the Systems Thinking community (and its cousins - by virtue of the Performance Model of The UN Global Compact - in the corporate social responsibility community) manage to get organized well enough to offer themselves as the "new way" when the time comes. Because if they don't then some "other new way" will take its place. (Yes, I'm talking about, Sarah Palin. I know she sees this crisis coming. But she has a very different take on what the response to the crisis should be. After all, she's an "end of days" person.)

But there's another hurdle that Systems Thinking will have to overcome. And that is that - at its very core - it is a discipline that involves thinking differently. As the name suggests, it involves thinking in systems... frequently and continuously... which is not how many of us have been taught to think.

Ours is a culture of specialists. From doctors, to lawyers, to sports, to politics... most of us specialize in something. Precious few of us are generalists. The saying "A little knowledge is a dangerous thing" is correct when it comes to doing specialized actions, like flying a plane. But "a little knowledge about a lot of things" is actually a very powerful thing... because only by knowing "a little about a lot" can we see the connections between things that don't necessarily appear to have obvious connections.

But there's one person who comes to mind whose 20+ years of talking about "connections" - to the public in a very effective way - may be of use here. I'm referring to the British historian and educator, James Burke.

Starting with The Day the Universe Changed (which I watched on PBS in the late 1980's) and through Connections 1, Connections 2, and Connections 3, James Burke has produced the finest examples I know of educational programming on the interconnectedness between ideas and how those connections throughout history have led to the modern society we have today.

I urge the Systems Thinking community to reach out to James Burke and, in all other ways possible, to encourage the public to learn this history lessons he has to teach as a way of motivating study of Systems Thinking.

Russ Ackoff has left a huge legacy. Nearly 30 books, hundreds of articles, and a global network of students and colleagues he impacted in very significant ways. To get an idea of what I mean, I invite you to read the notices from people at the UPenn Organizational Dynamics Program site. Or just search "Ackoff" on Twitter.

But to me, the real legacy of his work is the knowledge of how our society can heal itself. Russ' work wasn't about management in some objective, dispassionate way. It was humane and deeply philosophical... about people achieving their best, based on their individual, natural gifts. He may have talked tough to people at times, but it was a form of "tough love" based on his wanting us all to reach our full potentials.

As a nation, we are suffering sociologically from a loss of capacity to talk to those who don't think like we think. And we are suffering procedurally from an attempt to fix all the seemingly separate challenges we face without recognizing that they all share a common core connection... and that - by redesigning that connection... that larger system - the solutions to those separate challenges will become self-obvious and much easier to design and put in place.

A great man may have left us... one who knew that it's possible for our nation (and our world) to be a place of prosperity for all. And he may have even known how to get there. But what he had to teach remains. The question I'd like to ask you to ask yourself is:

If our society could get beyond the huge mess that it's in but, to do so, I would have to become a generalist instead of a specialist... to see whole systems instead of parts of systems...would I be willing to learn to think this way?

I look forward to hearing answers from those who want to share them.

And here's a one minute video that may help you think this through....

Mountain Redesign: What "Davos Man" Should Be Doing

Originally published in The Huffington Post on January 28, 2009.

The Economist has published an essay on the World Economic Forum in Davos entitled "Mountain Reboot", which says, in part...

It is generally agreed that the system needs rebooting. The Davos agenda, entitled "Shaping the Post-Crisis World", is laden with soul-searching discussions about the mess, from the brainstorming session on "What Happened to the Global Economy?" and an "interactive dinner" called "36 hours in September: What Went Wrong", to CNBC's debate, headlined "No Way Back".

... and sums up this year's event as follows:

Mr Schwab (the World Economic Forum's founder) is likely to be delighted that this year's Davos will feature a record crop of heads of state and politicians. This marks the latest stage in the evolution of the World Economic Forum from a gathering of European businessmen trying to figure out how to get more trade liberalisation into the leading talking-shop for the global elite. Although it is not a decision-making body, the true test of the Forum's value will be whether the week's chatter will lead to action. Having led the world into its current mess, will Davos Man and Woman find a way to lead it out again?

The essay's title -- "Mountain Reboot" -- implies that the system that has crashed just needs to be restarted, like an old computer. This is the wrong metaphor. We don't have a system that needs to be restarted. We have an obsolete system that needs to be redesigned!

I wish the organizers of Davos had invited some engineers and architects to lead the "What Happened to the Global Economy?" brainstorming session, because when something collapses on its own -- as capitalism has -- engineers and architects know to look at the principles used to design the system in the first place and see which of those design principles are the reason for the collapse. Replacing those principles with new principles that work... that will prevent a future collapse... is what they do. (I used to be a civil engineer. That's why I know this.)

Taking this approach, I see that the current system was designed when the world consisted of separate, independent nations that could survive in an environment in which they competed with each other for dominance of the world (putting aside that some of them would be destroyed during the occasional war). "Balance of power between nations" was the catch-phrase. The current system was also designed when "never ending consumption and growth" (including never ending growth of profits) was an essential part of the business world's foundational beliefs.

We now know that "competition for dominance" and "consumption / growth" are obsolete principles.

Why? Because we truly are now in an interdependent world (both economically and regarding the challenges we face, like global warming). And because sustainability -- (the wise use of what we have, including the free energy supply from the Sun) -- has replaced never ending growth and consumption as how we now know we need to live.

It is time for our economic system to catch up with our physical, technological, and sociological realities. The gross mismatch between a competition and growth driven economic system -- functioning in a world that knows we are one human family that needs to live together in peace (and finally has the technological ability to do so) -- is why capitalism has crashed. Capitalism as currently designed must be replaced, not "fixed"... not "rebooted".

Just as you must switch from a car to a boat when you begin traveling on the ocean instead of dry land, our world's leaders must organize around designing and implementing a new economic system appropriate to this totally new world. This is what Kofi Annan knows we need. He has written "At Davos, our business and political leaders must show they understand that our world has shifted for good and that we have to change with it or perish."

Perish we will, if we think using an obsolete system will enable us to travel in the new, "one world" waters we find ourselves in now.

Celebrating Capitalism's Death? Not so Fast...

(Originally published on The Huffington Post on 19 September 2008 as a follow up to an essay entitled "Capitalism Is Dead. Now What Do We Do?" which was published on The Huffington Post on 17 September 2008)

Welcome to our brave new post-Capitalistic world.

Today our leaders in Washington announced (all the details to come later) that the Federal Government is going to rescue the financial system from total collapse.

You can read the story as reported by The New York Times here and, of course, more details of this plan will come out in the hours and days ahead. But I want to address the very first part of The New York Times' report: the reaction of the markets around the world...

Stocks shot wildly upward Friday morning after the federal government moved to try to restore confidence in the financial markets.

The Dow Jones industrial average rose more than 400 points only moments after the opening, and later settled up more than 300 points. The broader Standard & Poor's 500 was up nearly 3.5 percent. Markets in Europe and Asia also traded significantly higher, with stocks in London and Paris up more than 8 percent.

There is a celebration going on. This doesn't surprise me. But I'd like to raise the following point from the world of Systems Thinking:

Just because you stop something old that is bad, doesn't mean you will automatically start something new that's good.

Our government has stopped something it considers to be bad. It saw the collapse of the economic system coming. The action it has taken has -- and this is me talking, not our government, of course -- ended Capitalism here in America.

Actually, its not just me talking. Here's a report from The New York Times on what financial leaders in the rest of the world think about what we are doing here. They know America is no longer a Capitalistic society either. From this September 18th report...

"I fear the government has passed the point of no return," said Ron Chernow, a leading American financial historian. "We have the irony of a free-market administration doing things that the most liberal Democratic administration would never have been doing in its wildest dreams."

The bailout package for A.I.G., on top of earlier government support for Bear Stearns, Fannie Mae and Freddie Mac, has stunned even European policy makers accustomed to government intervention -- even as they acknowledge the shock of the collapse of Lehman Brothers.

"For opponents of free markets in Europe and elsewhere, this is a wonderful opportunity to invoke the American example," said Mario Monti, the former antitrust chief at the European Commission. "They will say that even the standard-bearer of the market economy, the United States, negates its fundamental principles in its behavior."

Mr. Monti said that past financial crises in Asia, Russia and Mexico brought government to the fore, "but this is the first time it's in the heart of capitalism, which is enormously more damaging in terms of the credibility of the market economy."

We no longer have a "market economy" here in America. Capitalism is dead.

But what are the people on Wall Street and other financial centers celebrating? The end of something bad. But -- I assert -- not the start of something new that is good.

Our government literally sees that the Titanic is sinking. And it is using its extraordinary power to raise the Titanic out of the ocean, shake all the water out of it (literally bailing it out), and place it back in the ocean hoping it will then sail on.

But the Titanic cannot sail on.

That's because the Titanic that is our global economic system is fundamentally flawed. It is based on a belief that we are still sailing in a zero-sum world, a world of scarcity, a world where there will always be too many people chasing too few resources. The sustainability scientists... and those schooled in advance social and managerial sciences as well... know this is no longer true. They know an abundance-based world is what we live in now, from an objective reality point of view. They know that the only thing in the way of that becoming the reality we all live in is the design of our political-economic system.. because it is still a scarcity-based design.

The American government's effort is very impressive in scope... but not in sophistication. It is an 800 pound gorilla approach, involving a huge willingness to throw money at the problem. But, intellectually speaking, it is "the blind leading the blind". It is "experts in the past" attempting to solve a problem whose root cause they cannot see. None of them has ever even heard of - as best I can tell - that scarcity is an objectively obsolete way to view the world. None of them has ever seen what is at the foundation of the work of people such as William McDonough, Amory Lovins, or the late Buckminster Fuller.

It is a tragedy in the making, because they are missing a huge opportunity to truly do the right thing... to take a sophisticated -- rather than 800 pound gorilla -- approach to this crisis.

A sophisticated approach.... one led by people who know how to work with the fact that the present is different from the past -- i.e. designers -- would address the fundamental fact that our economy is based on a zero-sum mental model in a global reality that is actually an abundance-based world waiting to be born.

As a designer myself, I saw this situation when there was a smaller -- but still very visible -- challenge to the stability of the global economic system. This was in October of 1998. At that time, BusinessWeek published an editorial called "The Age of Uncertainty". In that October 26, 1998 editorial, BusinessWeek said:

In the blink of a summer's eye, the psychology in America has changed totally. People suddenly don't know what to think about the economy, their investments, or their future. Before July, the U.S. had economic nirvana. Now confusion reigns. Volatility dominates markets. Hedge funds blow up. Deflation looms. The Asian contagion spreads. Russia defaults. The dollar plummets. CEOs worry. And Washington fiddles with impeachment. Yet the economy still feels pretty strong. So what is really going on out there?

In response to that editorial, I wrote a letter which BusinessWeek published on November 16, 1998. Here's what I wrote back then:

IN A GLOBAL ECONOMY, ALL PARTS NEED TO PROSPER

"So, what is really going on out there?'' you ask, in ''The Age of Uncertainty'' (Editorials, Oct. 26). For a more complete answer, look to the principles of systems thinking. A ''confluence of events'' is not the only thing masking the true fundamentals of the global economy, creating this ''fog'' you refer to. The ''fog'' is being created by the tendency to see globalization from a perspective grounded in our history of living in a world of separate, independent nations. The world's economy has become one interdependent system, yet we continue to view it through independent eyes.

What's really going on, from a systems perspective, is that a new, single, global system is struggling to be seen for what it is -- a system that can prosper only if all of its parts prosper. It is a single system, one that innately knows that either all of it will make it or none of it will. That's the way healthy systems work. The business world will prosper beyond its wildest imagination once it cuts through this fog and stops viewing the future through ''past-focused eyes.''

I still believe everything I wrote almost ten years ago.

The business world will prosper beyond its wildest imagination once it sees the future for what it can be. Some businesses will have to change more than others to take advantage of this new opportunity, but that's what the best businesses do, right? (Weapons manufacturers will have to change the most, as war is finally seen as the obsolete "international development tool" that it is. But that's okay. The skills of those corporations can easily be used to study, analyze, and produce constructive solutions -- especially highly scientific ones -- to our sustainable development challenges.)

This business world mindset is why the business strategy book Blue Ocean Strategy has been a global best seller since its release in 2005... because business leaders are always looking for the "blue ocean" of "no competition"... the economic landscape where they can operate first.. offering new products and services that do and offer things that no other business is selling.

Well, there is a huge blue ocean available to all the world's businesses now. It is the post-scarcity, post-zero sum Capitalism world that is waiting out there.... just waiting for us to reach out for it.

I hope at least some of our business and political leaders are in enough of a shock that they will look for new ideas and new answers such as those I am talking about here.

We don't have to settle for 800 pound gorilla thinking. We can innovate our way out of this crisis, with our eyes completely open to the true nature of the challenge we face... open to understanding the root cause of the challenge we face. And by understanding the root cause of the crisis we are in - that we literally see fighting as the "first principle" of living when cooperation and collaboration should be the first principle -- we can design our way to a better future... to an economic system that will provide all businesses -- and all the people on Earth - with more prosperity than they ever believed possible.

We must not just stop something old that is bad. We must start something good that is new.

Addendum: Saturday the 20th, 8:45am

To give people hope that society can continue to evolve (mature), I invite you to watch the opening of this landmark TV series "The Day the Universe Changed", hosted by James Burke, which first ran in the late 1980's on PBS. Mr. Burke went on to host the similar series about this history of human progress, "Connections", "Connections2" and "Connections3". Mr. Burke's current work can be found here.

Capitalism Is Dead. Now What Do We Do?

(Originally published on The Huffington Post on 17 September 2008)

Capitalism is dead.

And I'm not surprised.

I'll explain why in a minute, but first here's Capitalism's obituary. It's the New York Times' lead story on the bailout of A.I.G....

WASHINGTON -- Fearing a financial crisis worldwide, the Federal Reserve reversed course on Tuesday and agreed to an $85 billion bailout that would give the government control of the troubled insurance giant American International Group.

The decision, only two weeks after the Treasury took over the federally chartered mortgage finance companies Fannie Mae and Freddie Mac, is the most radical intervention in private business in the central bank's history.

With time running out after A.I.G. failed to get a bank loan to avoid bankruptcy, Treasury Secretary Henry M. Paulson Jr. and the Fed chairman, Ben S. Bernanke, convened a meeting with House and Senate leaders on Capitol Hill about 6:30 p.m. Tuesday to explain the rescue plan. They emerged just after 7:30 p.m. with Mr. Paulson and Mr. Bernanke looking grim, but with top lawmakers initially expressing support for the plan. But the bailout is likely to prove controversial, because it effectively puts taxpayer money at risk while protecting bad investments made by A.I.G. and other institutions it does business with.

Hmm... "...the bailout is likely to prove controversial, because it effectively puts taxpayer money at risk while protecting bad investments made by A.I.G. and other institutions it does business with."

Controversial? No. Not to me. Confirmational. That's what it is.

It confirms that our nation is not willing to let Capitalism be Capitalism, except for us little guys of course. But here's the thing. If Capitalism isn't Capitalism for the Big Guys, then it isn't Capitalism for the little guys either.

Just like there's no such thing as being a little bit pregnant, there's no such thing as having a little Capitalism over here and a little Socialism over there. You can't have two economic systems operating in one country at the same time, at least not if "all men are created equal" is written in that country's founding documents.

Sorry, my friends. You either have Capitalism or you don't.

And here in the USA, we no longer have it. It's dead.

Think about this. Our government has just decided -- without asking any of us, including our Congressional representatives -- that $85 billion more of our money should be used to cover the actions of (and pardon the unsophisticated language here) stupid, greedy, criminal people. Stupid, because they didn't have a clue that what they were doing would have such negative consequences. Greedy, because all they could see were short term dollar signs in front of their eyes. Criminal, because they just robbed you and me of $85 billion dollars by holding a "we're too big to fail" gun to the head of the US government.

They should have let A.I.G. fail, because -- if that had brought about the collapse of the global economic system -- that would have just sped up our journey to a point of systemic collapse we are destined to reach anyway. I say destined to reach not because it's God's will but because no system can continue to function when its fundamental design is flawed. You see, the current global economic system is based on a fundamental assumption that -- while it was true when the system was first set up -- is no longer true today.

Let me give you another way of thinking about this. If a car that is designed to handle any road condition at any speed suddenly finds itself traveling across the water, it will quickly sink below the surface even as its wheels keep spinning. And, if the driver remains oblivious to the fact that there's no longer a road under his or her car, that driver will die.

We are no longer on land, my friends. We are in a car when we should be in a boat (or maybe an airplane). The global reality has shifted, but our political leaders are largely blind to this reality. They think we're still on dry land.

More about all this in a minute. But first, back to the US economy...

The funny thing is, I've known that a significant portion of the US economy is Socialistic for years. "What are you talking about?", you ask? "The Military Industrial Complex," I answer.

You do know that all military weapons are purchased using "cost plus" contracts, in which businesses are guaranteed a profit, don't you? And that literally every weapons system comes in over its original budget... and that those cost overruns are absorbed by the government, not the arms manufacturer? There is no Capitalism in the Military Industrial Complex. It's all Socialism, justified by the concept that these weapons are so important to American security that the companies that manufacture them have to be guaranteed a profit, so they don't accidentally go out of business. (By the way, I worked in contracting years ago at the Army Corps of Engineers. So, I know something about how military contracts work.)

Now, getting back to the death of Capitalism in America as a whole, don't be so sad. You know the expression: "From every emergency, there's a chance for something new to emerge."? Well, that's where we are.

We are in one hell of an emergency. And - if you'll step back for a minute - you'll see it's the opportunity of a lifetime.... the opportunity to stop using what no longer works and figure out what does.

And now I'm going to surprise you by (partially) agreeing with John McCain. He says we need a Commission to study the problem. And I agree. But we don't need a Commission of the kind John McCain suggests we have. His Commission would consist of financial experts. And that won't do. Because financial experts are experts in the past.

We need to bring specific, outside of Washington expertise to the party. But they must be experts in the future, not the past.

And what kind of people are experts in the future?

Designers. That's what kind.

Designers know how to envision what's possible from the best of what we know how to do today. They know how to take a clean sheet of paper approach to figuring out how to fulfill a particular need.

Designers know how to take a system that no longer works... determine what assumptions (or design principles) used to build the system are still correct and which are incorrect... substitute new assumptions or principles where necessary... and develop and implement a new design appropriate to the reality of today.

We need people like that... people who know that a tipping point has been reached... that the ground on which our old economic system has stood has disappeared... and that, as a result, the old system is totally dysfunctional. But at the same time, these experts must know how functional - how elegantly functional - our new economic system can be!

We have a chance for something new... something beautiful... to emerge from this emergency! But to do this, we need people who understand how to take a culture through a Great Transition... a transition based on recognizing we're no longer on dry land, as I mentioned above.

So, if we are no longer on dry land, where are we?

Well, the "dry land" of the past is the zero-sum, fixed pie, scarcity of resources based economic model that has existed since the beginning... since the time when two groups of cave dwellers fought over a watering hole that contained enough water for only one group to survive. Humanity has been on that "dry land" for a long, long time. But science and technology - including the power to capture limitless amounts of energy from the Sun - has progressed to the point where we can live in a society based on an economic systems based on abundance (not scarcity).

A world where it's possible for all survival needs to be met. That's where we live now. Call it water or air, it's definitely not the dry land of the past.

And that's why Capitalism has died. Because it is a system that is compelled to try and make more and more money based on Darwinian principles that are no longer true. They were true when Capitalism was created, but they are obsolete now. This death was inevitable, because the mismatch between the world Wall Street thinks exists and the world that really exists is so fundamental... the methods needed to continue making money in a world of the past had become so complicated... that self destruction was only a matter of time.

If the universe is a giant clock, you can only last for so long if you don't work the machinery the way it's designed to work. You will blow up the clock if you don't change what you're doing.

"Oh, but humanity can never learn to stop fighting with itself," some people might say. "That's a fundamental part of how things work too."

"Really? Is a baby born wanting to fight? Is it born wanting to kill others of its own kind? No, fighting is a learned response," I say in return.

A big job? Yes, making this change will be a big job. But with the death of Capitalism, we have been given a great opportunity to take the first steps.

And with the choice of Barack Obama -- a man who knows cross-cultural, systemic, and bi-partisan issues and who does not see the world through warrior eyes as John McCain does - we have the opportunity to take a huge step (politically) in the direction of making this change.

But it's going to take more than electing Barack Obama to support the rise of a New Economics from Capitalism's grave. Barack has said this election has never been about him. And he is right. We must all contribute to this process, by learning what a post-scarcity-based world can be like, including the interpersonal skills of "interdependent living" such as those in the classic book "The 7 Habits of Highly Effective People" by Stephen R. Covey.

Beyond the personal, I suggest you study the works of two masters of large-scale systemic change: Drs. W. Edwards Deming and Russell Ackoff. They developed much of the management theory needed to organize such a transformation. Dr. Deming's last book was called "The New Economics". And Dr. Ackoff's recent book "Idealized Design" is the other book I would start with as.

In the popular jargon of my friend Renee Mauborgne's book "Blue Ocean Strategy" (co-authored by W. Chan Kim), what I am suggesting is that the death of Capitalism gives us the opportunity to develop and implement a Blue Ocean Strategy for America's sociopolitical economic system.

This will be a sociological change as much as it is a financial system change. Humanity has lived in a "you or me" world for many, many centuries. Changing to a "you and me" world (as Buckminster Fuller used to call it) will be the great adventure of the 21st Century.

Thanks to the death of Capitalism, that adventure is an idea whose time has come. Let's look for leaders who understand the need to figure out how to live in this new world. Leaders like Barack Obama. And leaders (hopefully) like the person you see in the mirror every morning.
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Addendum: 10:30am Eastern

As I think about AIG saying "We're too big to fail" to the Feds, I am reminded of America's long-standing policy not to negotiate with terrorists. Well, it sure feels as if the Feds have just agreed to the demands of certain financial terrorists: people who threatened to destroy our way of life if they weren't paid $85 billion. Disgraceful... and further proof that the America we think we live in... an America of ethical, Capitalistic principles no longer exists. If AIG needed $85 billion, they should have held a big charity event and asked the American people for the money... not taken it from us by using threats of the harm they would create if they didn't get it.

Addendum 2: 12:15pm Eastern

While I responded right after a specific comment, I'll state it here so it's clearly visible to everyone. I am not advocating Socialism replace Capitalism in America. I say Socialism already exists in portions of our society, but that does not mean I think it is the solution. The solution I am advocating is a New Economics designed by people who know how to take a "clean sheet of paper" approach to problem solving.. and who will develop an economic model appropriate to an abundance-based (rather than scarcity, zero-sum based) world view. This new economic model has no name because it has not been invented yet. The closest thing I've seen to what this might look like is the concept of Developmental Economics as described by systems thinking experts such as Dr. Russell Ackoff.

I hope this clarifies things for you all.

How on Earth can we have fun living together?

I am writing this on the opening day of the 2008 Tallberg Forum, which takes place in the resort village of Tallberg, Sweden each year.

The overarching question created by those involved in this forum to date is "How on Earth can we live together?" The status of the ability to answer that question was stated (at the end of the 2007 Forum) as follows...

"Do we know what to do? Probably yes. Will we do it? Probably not."

"We know how to be economical, to live in harmony with those closest to us and our community. We know how to cultivate our lands to sustain nature's ecological balances. We know how to stay out of trouble and protect our homes and livelihoods."

From my perspective as a student of three of history's greatest Systems Thinkers (Drs. R. Buckminster Fuller, W. Edwards Deming, and Russell L. Ackoff), I believe the complete statement of the challenge humanity faces can be found by looking at what is missing in the statements above.

What is missing is this:

By saying we know how to live in harmony with those closest to us, what is left out is that we do NOT know how to live in harmony with everyone on planet Earth. In other words, the global "human family" does NOT know how to stop fighting with itself. It is a family at war... a condition that strikes family members even within what we traditionally define as a "family". And - just as traditional families benefit from reconciling their differences - the "family of man" would benefit tremendously if it were to finally reconcile its differences.

I do not know why the Tallberg statements from 2007 leave out the need for the human family to come together as one... to stop the fighting... but this is a Critical Need is we are all ever going to "... learn to live together."

What is also missing from these 2007 statements if fun. That's right... fun.

I will update this essay later on that last topic and more, but it is time for the formal program to begin.

If any of you who are reading this are also at Tallberg, please look for me. We've got a lot to talk about! :)

And if you're not here in Tallberg, please contact me if you'd like to talk about this too.

Six Years After 9/11: What Have We Learned? What Could We Still Learn?

Six years ago I watched the World Trade Center's collapse from my Brooklyn apartment. I went out to vote that day (an election that was ultimately re-scheduled) and the smell of burning plastic filled the air even though I lived miles from the site. From this picture taken from Earth orbit, I can see why...

The wind carried the smoke right over my part of Brooklyn.



I had lived with the WTC ever since 1976 - when I got out of college - because I worked in lower Manhattan at 26 Federal Plaza and my office windows faced South. In fact, each fall my office mates and I would wait for just the right days when the path of the setting Sun would take it right between the twin towers... an amazing thing to see.


A beautiful image that combined the best of the natural and man-made worlds.

After living in Brooklyn for 15 years, believe it or not I was scheduled to move back to Manhattan on September 15, 2001. I give my moving company (Shleppers Moving & Storage) a lot of credit for making the move happen on the originally agreed upon date despite all that had happened (and with needing to find a route from Brooklyn to mid-town Manhattan that was passable). Here's a picture of lower Manhattan that I took as I crossed over the East River on my moving day. You can see the smoke from the still-burning World Trade Center site.



In the weeks after the attack, as all Americans struggled with "What do we do now?" questions, I was fortunate to have my thoughts on the subject published twice as letters to the editor of The New York Times (something I've been able to do about 10 times over the years).

On September 27th, I wrote that our capitalistic society - starting with the philosophy for redeveloping lower Manhattan - should aim to put compassion at the center of a re-imagined core.



And on November 19th, I wrote that plans for redeveloping lower Manhattan should help people think clearly about the nature of the world both before and after 9/11.



So, what have we learned since 9/11? And what could we still learn?

Well, I'll invite you form your own opinion about the plans to redevelop lower Manhattan by helping you visit the site for the planning organization, "RenewNYC.com". You can visit RenewNYC.com here. The memorial itself has as its theme Reflecting Absence and is described this way:

"Reflecting Absence is the memorial to honor the 2,979 heroes lost in the terrorist attacks of September 11, 2001, and February 26, 1993. The memorial will ensure that future generations will know where the towers once stood and will never forget each individual life taken during those tragic days. The memorial will be a place for families and friends to remember, a final resting place for those who have not been identified, and a place where thousands will come to reflect upon and share our personal and collective loss.... The memorial will not only remember those killed, but it will celebrate the heroism that prevailed following the attacks, and the resolve of our nation to overcome."

The phrase "the resolve of our nation to overcome" is appropriately therapeutic but misses the critical element that to truly move on from tragedy one needs to commit to a purpose that is future focused. Perhaps one that respects the lives of those who died by reflecting what they wanted to accomplish in their lives, but still one that is future focused. Without that, one remains psychologically "stuck" in the past forever.

This is something that Mayor Michael Bloomberg apparently recognizes himself. You can read about how Mayor Bloomberg is - in the words of The New York Times - "(playing) an essential if more subtle role in nudging the city to gradually let go of its grief. It is a challenge the mayor has handled sometimes clumsily and sometimes with great sensitivity and eloquence, as he charted the path away from the concrete events of 2001. Now, as he works to imbue the city with optimism for the future, he even hints at a day when remembering may not mean reading the names of all the dead." here.

This article also quotes Mayor Bloomberg as saying (after the first 9/11 anniversary) "I think the Jews do it right. They have a headstone unveiling a year after the funeral, and that’s sort of the time that you sort of stop the mourning process and start going forward. And the 9/11 ceremonies, what I’m trying to do is that in the morning we will look back, remember who they were and why they died. And in the evening come out of it looking forward and say, ‘O.K., we’re going to go forward.’"

"Go forward." If only those redeveloping lower Manhattan knew this concept well enough to make "Ground Zero" and its vicinity an area that called to all Americans... and the people of the world... to make capitalism more compassionate. Well, I'm an optimist. Perhaps that will happen some day. (Read on for how I believe that can happen.)

There is one thing in RenewNYC.com's plans that does focus on the future - and in a very significant way, too. It is the development organization's commitment to "green" building design and construction principles. That is a great commitment, but it has no direct connection to the question of whether the future we create will be one in which terrorists either stop or continue to attack us. It will, however, save energy and provide a healthier work environment for the people in these buildings. And that's a good thing.

So, one thing we've learned since 9/11 is that those entrusted with formulating redevelopment plans in the face of a national catastrophe tend to do so by looking backward rather than forward. And the result is an increased potential that we will remain emotionally stuck in the past... not a good thing. In my opinion, there is nothing about the redevelopment of lower Manhattan or the World Trade Center memorial itself that will help the public think critically about what type of society we should be building in the future.

Although if Mayor Bloomberg had been in charge, there's at least a chance the memorial would have been forward and future focused.

Now, regarding my call for Compassionate Capitalism, we only have to look as far as Naomi Klein's "The Shock Doctrine" to show us how far capitalism is from being what one could even begin to call "compassionate". (If you haven't watched the short documentary made in conjunction with her new book, I highly recommend you do so here.)

"The Shock Doctrine" describes how entire societies have been taken advantage of (one might even call it "cultural rape") by those entrusted with leading them out of danger. Whether the danger is economic or security related, when it strikes there exists a conscious effort on the part of members of the business and political classes to push through changes in "the rules of the game" that make it much more possible for certain wealthy people to get wealthier and more powerful while the rest of us get poorer and less powerful.

When matched against the rules of society, this is serious, immoral and illegal stuff. And to the degree that it is happening in America (and it is, but Naomi Klein's work talks about other countries as well), then those responsible should be tried for their "high crimes and..." Well, you get my drift.

Unfortunately, it has become increasingly clear that the George W. "we create our own reality" Bush administration cares very little about the Rule of Law. It cares about the Golden Rule ("He who has the gold rules.") And those businesses - and business leaders - who finance and otherwise support the Bush administration's activities and the activities of those politicians (both Democrats and Republicans) who keep this systems in place also live according to this most twisted of "golden rules". As I say, they should be put on trial for their crimes against the system created by The Founding Fathers.

(Can you imagine what it would be like if our nation's business and political leaders - who so frequently refer to their religious beliefs - lived in accordance with the real Golden Rule? Why, we've live in a totally transformed world! But I digress. Sorry.)

John Dean has just written a fascinating new book, "Broken Government", in which - along with many other things - he discusses the role the Democrats play in keeping this illegal, immoral, and dysfunction system going. In an article Dean wrote called "Defeating Dysfunction" to promote his book, he says "Democrats criticize Republican policies, but they ignore the persistent abuses of process that have become normal Republican political behavior. Democratic distaste for addressing process issues first came to my attention following the 2004 presidential campaign, when I spoke to one of Senator John Kerry's top advisers. I was curious why Kerry had not pressed President Bush about the excessive secrecy he and Vice President Cheney had imposed on their administration... Kerry's adviser told me the campaign had not addressed this concern because "secrecy is a process issue." Process, apparently, was an area where the Democratic candidate did not go."

Dean goes on to say that "the current inside-the-Beltway wisdom holds that the public is not interested in process. In fact, empirical data show this is wrong." And he concludes by saying "The vitality of American democracy demands that (the Democrats) once again take up process in 2008."

In saying clearly that "It's the process, stupid", John Dean points to the critical lesson of our time... and the lesson we must learn. For it opens the door to the only way we will ever have the Compassionate Capitalism we are capable of having. This is The Lesson We Can Still Learn. It's not too late.

It is a lesson that will take America down a road which many Democrats may be uncomfortable traveling, but it is the only road that leads to the objective we must reach as a nation: the restoration of our American values. "Truth, Justice, and the American Way" wasn't just something Superman used to say he stood for. It was who we were on our best days and who we sought to be on our worst. It was never what the people we have entrusted to lead us into the future consciously sought to violate.

So, we must deal with the process we are using to get where we say we want to go. The Democrats must deal with the process. Progressive thinking Republicans must deal with the process. Third party candidates must deal with the process. (Ralph, this means you don't get to say that there's no difference between Democrats and Republicans anymore. Read John Dean's book, okay?) And "we, the people" must deal with the process.

Because to not do so is like saying "The automobile I'm driving has gotten me everywhere I've wanted to get to so far. I'll just keep driving it as I try to get to this new destination", as you leave dry land and set off across the water to get to a distant land called Compassionate Capitalism.

See how crazy it is to think this way? We're still in our cars and are trying to drive across the water. We are sinking fast, my friends. We need to get out of our cars!

If you agree with me and are now asking "Okay, where do I go to learn about process? And has anyone figured out what process could get us to this better future?", then I say "Welcome aboard! It's going to be an exciting journey from here forward!"

There are places you can go to learn process. And there are people who are already using the New Thinking society needs to adopt in order to get to this better world.

If you are an organizational leader (either for-profit or non-profit), I highly recommend you get involved with the Malcolm Baldrige National Quality Program, which is run by the federal government's National Institute of Standards and Technology (NIST). This program - which was signed into law 20 years ago during the Reagan Administration - is based on the continuous learning and improvement principles originally developed by such quality management leaders as Dr. W. Edwards Deming and Dr. Joseph Juran, the men who went to Japan after World War II and taught the Japanese how to make high quality products.

The Baldrige Program is intense, educational, and the best national program I know of for learning how to view what you're doing in ways that support you in making fundamental change. (Perhaps the US Congress should get involved with the Baldrige Program.) For those who want to "play in the minor leagues before joining the majors", I recommend the state-wide, Baldrige-based programs that function under the umbrella Network for Excellence. (Point of transparency: I am a board member of the Keystone Alliance for Performance Excellence, which is the Baldrige-based organization that covers Pennsylvania.)

Finally, while you may think that Compassionate Capitalism is an idea beyond what anyone dealing with process is talking about, I call your attention to the Corporate Social Responsibility movement. It is an increasingly mainstream corporate strategic focal point - as recognized by Harvard Business School's Michael Porter, in his article "Strategy and Society" which was published last December - AND it includes a focus on process, especially under the umbrella of the work of The UN Global Compact. The Global Compact's Performance Model is a Baldrige-like, continuous learning and improvement based program any organization can use to examine how it is going about attempting to be a good corporate citizen and to improve the processes it is using to do so. The Global Compact is a world-wide initiative that includes a network of USA-based corporations. At the same time, here in the USA we have Business for Social Responsibility, which works in partnership with The Global Compact.

There is hope, my friends. You just need to know where to look for it.

And in the case of our political and business leaders, we who want them to "do the right thing" need to demand that they examine and fix the process! (And learn how to do so first!)

We can get to the better world we say we want. But we can't get there by using the same thinking... the same process... we've used until now. We need to learn how to Think Differently!