Saturday, 21 November 2009
John Demspter, a fresher to the world of blogging, joined Stephanie Flanders blog recently and instantly made an impact. His questioning was sound, his passion to make difference very evident, and his desire to join people together to open up and tackle the issues clear. He also explained why we need to do it ... and for me he articulated this so well I have decided to summarise what he said here ...
Post 375. At 11:40pm on 21 Nov 2009, Dempster wrote:
"To Leanomist, ishkandar, Bobrocket, stephenblencowe, armagediontimes, glanaflon, CDG & all other bloggers contributing to this website
I suggest that: as adults with a responsibility to the children, the teenagers and the young families who inherit what comes after us, that we do the right and proper thing.
To consider the issues that face this country, we should debate them and as best as we individuals can, in this limited environment in which we blog, endeavour to show that we did at least try.
Having read what you have posted, I do not believe that a single one of you, would not do that which is right by the future of our children.
Our voices are unlikely to be heard, but at least we gave it our best shot.
I am an absolute nobody, I freely admit it, but you lot give me hope, perhaps you can give hope to others."
Post 383. At 01:13am on 22 Nov 2009, Dempster wrote:
"To Leanomist, ishkandar, Bobrocket, stephenblencowe, armagediontimes, glanaflon CDG, spartacus & all other bloggers contribruting to this website
Those who will come after us, hope that we will do the right and proper thing by them.
If we don’t do it, then what is our legacy?
Imagine if you are a child, would you hope that adults would do the right thing by you?
I suspect that most of us bloggers are not young people. But what we post may influence the future for those who come after us.
I’m still a naïve blogger, and whilst it may be a forlorn hope, perhaps we can make some difference.
Put your self in the position of a young child, what would you hope we would do?
A young child would want us to look after their best interest… perhaps I am wrong?
But you lot know the answer to that question, don’t you".
and in response I added ...
Post 383 John Demspter - Well put and I agree with you. Your comments sum up very well my reason for writing ... and why I set up the Poweromics blog too ... which will
i) continue until the environment around us changes,
ii) track/chart the history of the revolution,
iii) try to point out all those responsible/culpable, and
iv) try to acknowledge those taking responsibility to try to do something about it.
and with regard to (iv) you are clearly one such person - hence you are already referred to in it - take a look here for instance.
PS Nobody is a nobody - and you've already made an impact here (on me at least).
'For evil to flourish, all it needs is for good men to do nothing' [Edmund Burke]
On Stephanie Flanders recent blog I was asked a question about the squeezing of budgets, and some of the challenges ahead, and in response I wrote:
'IMHO your questions/insights are good. The government (and politicians of all colours) are void of ideas and/or unprepared to take on the challenges ahead in any robust way (nb the main things in Gordon’s toolbox seem to be QE, inflation and spin). IMHO the fundamental problem we actually face is one of outdated leadership & management practices (e.g. in terms of politics, economics, service and enterprise).
There are lots of ways companies & nations will ‘grow’ in the future, but outdated leadership / management practices mean most ‘leaders’ haven’t got a clue how to do it, and the majority of ‘leaders/managers’ will have to ‘unlearn what they have learnt’ in order to access the ‘world of opportunity’ of opportunity that actually exists. The idea of somehow hoping/relying upon a immediate/massive resurgence in manufacturing is also flawed, as is the concept of considering products and services in isolation of each other.
In terms of public sector cuts, IMHO given the level of crisis now faced the only robust solution (both in the short term and the long term) is to rapidly introduce 21st century lean management practice … to continuously, and systematically, remove all non-value adding activities and divert all of our taxes/resources to value adding activities. When enterprises start to do this, most initially find between 40-90% of all time / resources are actually being wasted (and as you can probably imagine with public sector services this tends to be at the higher end of the scale!).
Leaders/managers need to learn how to support front line staff to continuously improve the way the work works (and how to systematically challenge/remove all the barriers to providing value in more effective ways). This process invariably releases resources (a lot of resources!), but the ‘key’ thing is what you do with the resources released. Front line resources released need to be re-invested into improving / increasing the services provided. Managers supporting front line staff to continuously improve how value can be provided are also kept, but the remaining ‘leadership’ and ‘management’ (i.e. who don’t understand the work, create barriers instead of removing them, frustrate front line staff and prefer to ‘manage’ targets / league tables / people rather help/support people) need to find something else to do (e.g. work out how to add value!)
Resources released from front-line services are used to continuously improving the level of value provided and to identify/provide more effective services too (yes – more services – hence the term ‘more for less’). Meanwhile management has to change fundamentally (i.e. to lean management), with far fewer managers carrying out very different work – e.g. supporting front line staff continuously improving the work and systemically removing every barrier in their way of doing this (e.g. the plethora of bureaucracy and flawed policies – nb top line figures for the number of pen-pushers/bureaucrats is just the tip of the iceberg and most current policies are designed to generate waste, not remove it). You can think of this as a systematic ‘bureaucracy stripper’.
Lean management also needs to be applied to Government policies too (nb the bottom up continuous improvement described above would drive this anyway) … for instance changing the vast array of complex tax structures/credits which has resulted in a culture of dependency and armies of paper pushers to ‘check/process’ them all. It would also introduce robust, fairer, and much simpler taxes such as a Land Value Tax (referred to earlier). It was also remove the flawed and outdated targets/league table culture introduced by this Government … for instance take a look at my recent post here.
Lean management is already starting to be applied by forward thinking police forces/hospitals (with dramatic and positive outcomes – 30/40% improved outcomes in terms of time, resources, service quality, staff moral…). Change is coming, but it has been held back/stifled by all the policies/barriers put in place by this Government (e.g. league table/target culture).
Millions of jobs are going to be lost in the short term whether we like it or not … given this we need to make sure we lose the non-value adding ones and reinvest time/resources released from front line services to provide more and better services, so we can start to get back on track and avoid ‘cutting/slashing’ the actual services provided (like countries such as Singapore have done) … we also need to offer the majority of ‘managers’ released training in 21st century leadership and management practice! IMHO the youth of today should also be given the opportunity to separately learn about 21st century leadership & management practice too (e.g. within school), as it would expose them to the actual world of opportunity still out there, and expand their leadership and entrepreneurial qualities too.
Based on Deming’s work, I successfully decoded 21st century leadership and management two years ago, as well as the system diagrams describing the above (P219-223) … for those interested in learning more about this you can always read my book online (via Google books) here …
NB the ‘losers’ – the leeches/managers who add no value, fail to listen/learn, have no interest in helping/supporting anyone (eg like to please their boss, rather than customers / front line staff) and have no interest in learning/applying 21st century leadership & management. The other losers will be those who like to ‘obtain lots more wealth’ but by ‘adding no value’ ...'
Stephanie Flanders recently blogged about when and how to squeeze the budgets ... which raised lots of comments, including my own (post 4) below:
'We need as a matter of urgency to cut out the bureacratic leadership/management that add no value and create all the waste/frustration at the front line.
We need to systematically support front line workers to remove 40-80% of the time/resources tied up dealing with failure demand and carrying out non-value add activities, and re-invest their efforts into INCREASING, and CONTINUOUSLY IMPROVING the services provided.
We do not need to 'cut' services (we can increase them), but we do need to radically change (and reduce dramatically) current 'leadership'/'management', create 21st century leadership and management and install 21st century management systems* (nb it's 180 degrees opposite to what we currently have - these systematically remove waste, whereas current systems systematically create it!).
... therein lies the challenge ... and therein lies the future ... other nations have done it ... take a look here for instance ... but in the UK the toxic mixture of ignorance, arrogance, ineptitude and greed will mean the UK will avoid taking decisive action, wait until the last minute and have to try to pull itself from the brink of the abyss ...
* 21st century management systems are decoded in book for instance'.
A fellow blogger (glanafon) in a subsequent blog then posted the following:
"Leanomist, your one of these 'economystic' types I believe - So :
David Blanchflower favours inflation as a way of getting rid of the debt. I can see the argument for this as it spreads the load, hits savers, so takes money from people who have money. I start with DB because he has at least got it right saying - problem coming - when on the BoE committee.
DB is against cuts due to the unemployment issues. I can see this also. However what he has failed, from what I can see, is to explain how funding the public expenditure prop needed via borrowing can be sustained or how the inevitable cuts are to be phased in. Or how phasing cuts in later makes any real difference if growth is to remain very muted.
Inflation may get rid of the debt, which clearly helps, but it does not get rid of the size of the public sector which is now too large following a contraction in the economy. If there is little growth - the Japanese lost decade - then the public sector has to contract.
A total tax take - direct and indirect - of 43 to 46 percent, mainly 46 percent, has been in place for decades suggesting that 46 percent is a long term ceiling otherwise it would have been breached under pressure a long time ago.
So DB is gambling on growth from what I can see, that has to be his position. But if this is the japanese lost decade that doesn't work, again from what I can see.
Assuming the banking sector is not going to grow at any great rate, the suggestion has been manufacturing takes up some slack. As Kudospeter posted at number 29 'Manufacturing as a percentage of GDP in the UK for the following years were: 1971 31.7% 1981 26% 1991 21.% 1998 15.4% 2003 12.7%, ie an almost straight line decline. I cannot see this trend reversing so where is the growth to come from. Housing percieved wealth has been used as the engine to push individuals expenditure and borrowing and that engine has blown up.
So how can public sector cuts be avoided. I cannot see it. Can't say I like it but I can see it coming. I can't say I know where things are now but a near 10 percent drop in the size of the economy from peak has been mentioned. That was during a time when the public sector was reproted as expanding still at 2 percent. So the hit has been in the private sector and much bigger than 10 percent, much bigger. So the public sector sooner or later has to follow that stat, unless there is quite dramatic growth.
Meanwhile we are close to 1 million young unemployed with an education system pumping the young out every year. OAPs are demanding they work longer which will reduce job release back into the economy.
Now we have Gordon saying he wants to commit to halving the debt, although as usual nobody really knows what he is referring to other than hinself. Halving the debt can onlt mean a mix of inflation - repayment - taxation. All of which are designed to extract money out of the economy. Taking money out of the economy means its not there to be spent.
So Leano can you tell me have I missed anything much in this ..."
which i will try to respond to in my next post ...
Land Value Tax taxes the value of land, and replaces taxation on property. Most of the ‘value is in the land’, which is actually ‘created’ by the state in terms of what it puts around that land, hence the state seeing a return (in terms of tax) for that is entirely reasonable (and more ‘leading nations’ are doing it). In terms of pure economics, it is also argued to be one of the fairest/robust taxes to put in place, as the ultra rich landowners (who have profited heavily recently from all the wealth transfer) pay it, can’t avoid it, and can’t simply pass the cost of it on to others (due to natural supply/demand economics) … I would personally suggest all nations consider this carefully … as successful nations in the future will certainly be looking at it, and using it …
Sunday, 15 November 2009
Stephanie Flanders recent asked for the "New name for a New Economy', when in reality the question should have been about a "New name for a New Economics" ... so I pointed out the huge insights Dr. W. Edwards Deming offered to the world nearly 20 years ago (and from which Leanomics and my book 'Lean World' are founded), and as the discussion continued some commentators questioned whether a "New Economics" is here now, or even needed, so I posted the following:
"... IMHO 'a New Economics' is not here yet, but it is starting to emerge - and following on from my previous post ...
'Economics is the social science that studies the production, distribution, and consumption of goods and services' (Wiki).
IMHO Just like other 'sciences', 'economics' (as defined above) has been functionalised, is too narrow in scope and is effectively dead. The failure all around us now is testament to this. It fails to account for the values (and/or the lack of values) people uphold, their beliefs, the political systems, leadership and management practices, the environment, the intrinsic motivation within people and social relationships that exist.
The fact that we are comparing ourselves more and more to basic animals (i.e. species with very low intellect) arguably shows how low we have now fallen, and how moral values have been progressively jettisoned from the field of play. The fact that economics today is more about how people make money from money (wealth manipulation), rather than adding any real value (wealth creation), is also testament to this, and the purpose of money as a basic bartering system has been almost completely forgotten. This is the world of Poweromics, which is still very much in operation today, with no moral/ethical values, standards or rules, and seeks to manipulate the system for ones own gain ... and it has failed the vast majority ... but has successfully transferred yet more wealth to a small minority - the already wealthy (even from those not yet born - eg spiraling Government debt due to bailouts/failure).
Ignoromics will gradually reduce as the majority of people's lives get much worse ... but Government's will no doubt create wars and blame other people, to divert people's attentions/anger away from themselves, the real villians & from what's really going on.
Some countries are already challenging Poweromics and turning themselves around, kicking out Poweromics (e.g. poor leadership, management, corruption) and using lean management practice (and Leanomics) to improve overall well-being and to create a sustainable prosperous 'economy'. Those that fail to act will fail to survive, and will die by their own ignorance, arrogance and ineptitude. Those current leaching off the others like a plague of locusts will also eventually destroy all the fields they are feeding off, and/or will find a new resistant strains that 'repel attacks' ... and those places where Leamomics starts to thrive will have no time/interest in 'parasitic organisms'.
'Leaders' looking to deflect blame, rather change the system (as well as the way they lead/manage), will be given short shrift soon ... and IMHO that time is not very far away"
One of the original commentators went on to say ... "I hear some college professor at Oxford is to give a huge chunk of his future earnings to a new charity - that's what I call a real change of behaviour but how many will or can really afford to follow his lead?"
To which I commented "This is just a small/individual example of Leanomics I would suggest - it's worth noting more young people/graduates are starting to shun the traditional corporate world ... as they also see the world very differently too ... and they are unlikely to remain on a 'sinking ship' either" ...
Tuesday, 10 November 2009
The BBC reported today that findings from a Chartered Management Institute survey which revealed almost half of UK workers saying they have left a job because of bad management.
Forty-nine per cent say that under less drastic circumstances, they would rather take a pay cut than work for someone who made bad decisions. The findings come in a survey from the Chartered Institute of Management, as it attempts to launch a campaign to improve standards among bosses. It wants the government to make developing effective managers a national priority.
But the survey also found unhappiness among managers themselves. Sixty-eight per cent said they had fallen into the role by chance and 40% admitted they had not wanted the responsibility of managing people at all ... and Ruth Spellman, CMI's chief executive, said: "The figures reveal the depth of the crisis of confidence in UK management."
She added that such bad management was taking an enormous toll on the UK economy - and on people's well-being. The organisation promotes what it calls the 'art and science' of management and is pressing for action from the government to improve Britain's performance in this area.
It has launched a Manifesto for a Better Managed Britain, and whilst this is indeed honorable cause, the article unfortunately serves to highlight how little they know, and how far they are behind in their understanding in the 'art'/'science' of 21st century leadership & management. My own book successfully decoded the 'science behind 21st century management' practice two years ago ... and it also highlighted the 'art of 21st century leadership' too ...
... I'm afraid the institute hasn't got it's head around the basic definitions yet, and is still lost in the 'soup of generality', outdated practice (nb MBA = "Maybe Best Avoided"!) and misconception ... and as my recent blog pointed out ... most 'leaders' and 'managers' haven't seen half of what's yet to come ... e.g. the complete exposure of their failings, and tsunami of litigation heading their way ...
Monday, 9 November 2009
Whilst the Bank of England continues to print money to service Government debt, Banks are busy stoking up the next crash via another pyramid scheme (rewarding themselves huge bonuses in the process too) ... for instance, take a look this US article (as it also applies/relates to the UK too), as well some of the key additional points I've summarised below:
“Interest rates are close to zero; in effect the Federal Reserve is subsidizing the risk-taking and bond trading that has allowed Goldman Sachs to produce billions in profits and that infamous $16 billion bonus pool (analysts say it could grow as high as $20 billion). The Treasury has lent banks money, guaranteed Wall Street’s debt and declared every firm to be a commercial bank … They are all ‘too big to fail’ and so free to trade as they please—on the taxpayer dime.”
The Wall Street Journal reported Monday that Morgan Stanley has concluded that the amount of cash circulating in the global economy is at its highest level by far since the firm began tracking it 30 years ago. This vast wave of hot money can find no profitable outlet in production, so it is being pumped into stock markets and speculation on commodity prices and currencies. The result of a colossal global asset bubble that must sooner or later burst."
If the money taxpayers had provided to banks was steered into traditional banking only, and commercial banking separated from speculative trading (e.g. by Government's re-instating a Glass-Steagall type act), this type of behaviour would not be possible. Bankers would not be able to use government cash to underwrite short-term speculation to fuel their massive bonuses again, and they wouldn't be able to call upon taxpayers to fund their failure again either (i.e. once their current pyramid scheme collapses).
Commercial banks focus on lending to real 'wealth creators', to enterprises/institutions adding real value for others as well as to the well-being of the economy. Creating real wealth takes time, energy and resources, and is not a short term decision/investment/gamble. On the other hand, 'wealth manipulation', adds no real value, except to the bankers, traders and the already wealthy (who benefit further from this manipulation of wealth - particularly when it's taxpayers money being used to pay for all the failure). 'Wealth manipulation' takes very little effort in terms of time, energy and resources (e.g. beyond the passing on of 'pieces of paper') so banks see it a much easier (and 'profitable' way) of 'making money' from money (i.e. the velocity, and profit, from money is much greater), particularly when all the risk (i.e. failure) is taken on by someone else (the taxpayer).
... and it doesn't take a rocket scientist to work this out, so why have UK/US Government's chose not to heed such advice, and done absolutely nothing about splitting the banks up in this way? ... why have mainstream economists identified the fundamental flaws in the economic model? ... and why have the media been 'absent' in investigating this properly ... well it doesn't take a rocket scientist to work all these out either ...
and fail again it will ... but wow - decades more misery to sell news* ... and as the crisis deepens ... an attempt to create more wars to deflect people's attention away from the immoral/guilty ... so they can continue to quietly profit from the system ... and so the newspapers can sell more news ...
For this to change, Ignoromics needs to reduce quickly ... and Poweromics needs to be challenged too ... if apathy prevails for much longer, the outcome is pretty clear ... 'war'
* NB Good news/success doesn't sell (only bad news and celebrity does).
Thursday, 5 November 2009
Of the extra £175bn the Bank of England created through its Quantatitive Easing (QE) programme, around £173bn has been used to buy UK gilts - i.e. to buy Government debt to keep it afloat - as highlighted in my previous blog, 'Printing Money, Inflation and Spin'.
Today the Bank of England also announced it will be pumping in another £25bn too (QEII) - so it looks like Gordon is looking for the bailout to continue to keep the UK ship afloat until at least the general election, so he can try to avoid any more blame falling upon himself (e.g. for the impending tax hikes, and the slashing of services & public sector jobs), and so he can pass the problem onto someone else (rather than deal with it).
Trust, Honor, Responsibility, Respect? ... You decide!
Whilst some arbitrarily debate whether recovery is already on its way (e.g. based on outdated & flawed GDP measures) ... and others debate what more Quantatitive Easing actually means ... real insights about our 'economy', and some of the additional challenges/chasms ahead, slip out ... almost unnoticed !
With Government debt continuing to grow, with more businesses collapsing and with tax revenues falling rapidly, it doesn't take a rocket scientist to work out that the day of reckoning is not far away. The current Government have simply chosen to defer it - i.e. until after the general election next year - so they can avoid any blame and pass the problem onto someone else (Trust, Honor, Responsibility, Respect - I think not!)
After the general election, the delayed/stored up reality check will hit (like a tsunami), with unprecedented tax hikes and the slashing of public sector jobs (in a desperate attempt to balance the books). Unemployment will continue to rise and the systematic spiral of failure will continue to grow. Unions leaders are already predicting this and are preparing for battle - blaming politicians policies (and bankers greed) for the mess the UK economy is in.
Enough to cause a 'double-dip' recession? The unions certainly think so and so do I. What's more, what they've been referring to so far is arguably just the tip of the iceberg ... so let me explain ... and refer to more insightful news stories published today too ...
Outdated leadership and management practices (19th/20th century), demonstrated by most UK leaders/managers today (including politicians, civil servants etc), primarily focus upon extrinsic motivation, self interest & personal gain ... with managers in offices (remote from the work) making all the decisions, telling people what to do and driving them to hit arbitrary targets in order to get a bonus ... rather than going to the front line, listening to customers/staff and supporting front-line staff in their quest to continually improve how value can be provided to customers (nb this is what 21st century leadership and management practice is all about - take a look at my book for instance) ...
The former systematically generates frustration and stress, for customers and front line staff alike. It also drives people to manipulate 'the system' in order to meet their targets & goals; deflecting people away from the real purpose of the enterprise (i.e. to create value for customers) which destroys teamwork, morale, and the future of the enterprise too. Such practices have also been shown to systematically generate between 40-90% waste in terms of both time and resources as well - i.e. traditional enterprises spend most of their time (and resources) wasting time, effort and money, for their customers ... whilst stressing them out in the process too ...
... and a traditional manager's response to this ... "it's just the way work is" ... and "let's send everyone on a 'stress management' course - to help them to process stress" (and to also reduce the risk of being sued!) ...
The problem with the traditional management statements above is that they are both wrong - and flawed. 21st century management practices do not involve helping people to 'process stress' - they focus on systematically 'eliminating stress'! ... so there is no need for stress management courses at all ... (i.e. such courses are a 'cost of failure', and they do not reduce the risk of leaders/managers being sued either).
Enterprises applying 21st century leadership and management practices do not just transform the performance of the enterprise, they transform the lives of people - forever, and for the better. Most enterprises applying such practices quickly transform their capability (e.g. improvements of between 40-1000%) and change out of all recognition. Staff moral is positively transformed and stress is systematically reduced. People are naturally motivated to innovate, to add value and to help others. They are also more than capable of finding new ways to improve current products/services and to find new products/services that would allow even more value to be created too (given the opportunity). All they need is clear direction, as well as trustworthy leaders & managers who support them on the front line, who listen, learn, and help them to systematically improve how value is provided. Again not rocket science - just rarely practiced in traditional enterprises.
Stress, and the impact of stress, on people is heavily responsible for the 'eighth waste' in 21st century management practice ('untapped talent') - as it destroys people's desire/ability to contribute, to be creative or to think rationally (e.g. take a look at Ch. 8 of my book). It also impacts on people's overall well-being, as well as the well-being of those around them ... which impacts on communities/nations as a whole too (NB hence it's inclusion in the 'BUTS' test).
The National Institute for Health and Clinical Excellence (NICE) today said the cost of work related mental illness was £28bn - a quarter of the UK's total sick bill, and it also made clear that the stress created as a result of bad management/managers was the single biggest cause of problem. The 'economic loss' of stress goes way beyond the £28bn referred to here too ... this is literally just the tip of the iceberg.
Those leaders who believe stress management courses will 'protect them' from 'being sued' are I'm afraid also sadly wrong ... as 'ignorance' is 'not bliss' (or a defence - nb landmark cases are already occurring - but are mostly settled out of court to avoid publicity). The writing is on the wall now that 21st century leaders & managers have demonstrated the capability/outcomes created from applying 21st century practices ... which highlight the way forward, as well as the fundamental flaws in traditional practices ...
21st century leadership/management practice and examples will no doubt be used in evidence against those continuing to apply outdated traditional 19th/20th century practices ... and as millions of law suits start to get filed, yet more traditional private enterprises will go bankrupt ... and yet more taxpayers money will be diverted away from providing front line services (to pay for millions of out-of-court settlements) ... joining all the taxpayers money already being diverted to service Government debt, as well as the colossal (and unfunded) civil service pension liability ...
Double dip, absolutely ... a 'triple dip', and a 'quadruple dip' to follow, very likely too I'm afraid ... unless current leaders/managers change course dramatically, and quickly ...
The UK could successfully turn itself around (nb Singapore did it), but it will require very different political leaders to the ones we have now ... and things are going to have to get much worse before the level of Ignoromics reduces sufficiently for Poweromics to be effectively challenged ...
Tuesday, 3 November 2009
Stephanie Flanders today posted on a blog entitled the 'economist's new clothes'. Whilst starting a little debate, it choose to refer to the 'latest spin', rather than address the revolution in 'economics' we are likely to see. Hence adding the post (75) below:
IMHO traditional 'economics' is 'too narrow' in scope and also 'out-of-date'. It has also 'failed' hard-working people and is now effectively 'dead'.
But attempts to improve it, change it or widen it, will always be resisted. Dr W Edwards Deming, a creative outsider and a real 'leader', uncovered the "System of Profound Knowledge" and referred to the need for a "New Economics" (over 20 years ago) ... but, when terms are so out of date new words/definitions are needed, and for that reason, and for those interested, I am continuing his work ... using the definitions below:
* Leanomics = People taking responsibility for adding value and continuously improving the situation for others (e.g. customers, communities, overall environment), based upon fundamental values such as trust, honor, responsibility and respect.
* Ignoromics = People are either effectively ignorant of the situation (e.g. the overall environment) or not prepared to take responsibility to make sure it changes for the better.
* Poweromics = People using position and power for their own personal gain, based on poor moral values, self interest and greed.
It is worth noting virtually everything fundamentally centres around 'people' and the 'values' they uphold. It is also worth noting that Ignoromics is what allows Poweromics to flourish, and in my view this summarises the current (and widened) definition of 'economics' that prevails today.
Why not take a look at what 'leaders' everywhere are doing (e.g. your boss, company, service provider, government, politicians, media ...) and look at how many people understand this and/or prepared to do something about it ... I think you'll find its small ... albeit steadily growing (helped by the internet, and recent activities of banks/MP's etc).
IMHO the battle of the future is really one of values, and given the above definitions, can be simply summarised as ...
Leanomics v Poweromics & Ignoromics
For those interested I hope this is helpful ... and I would certainly recommend the work of Dr. W. Edwards Deming ( as well as http://poweromics.blogspot.com ) as a good starting point for looking into this further ... people are still amazed (and learning) how profound his insight actually was ... e.g. he told us far more about the future of economics than Richard Thaler in his lectures and book (I went to one of his lectures in London around the time of release of Nudge). I think you'll find people are still flocking to the latest incremental ideas, not more revolutionary ideas, yet only the economies moving rapidly to the latter will survive and prosper e.g. Singapore's turn-around - http://poweromics.blogspot.com/2009/10/asking-questions-doing-things.html
Whether people like it or not, the clock is ticking away and time is rapidly running out for most economies.
... I also added the following post referring to a previous bloggers (post 74) comments ...
"... Sheer self-interest or FUJIA !! So long the steerers can gain relative to the rest, they will carry on being motivated !! It doesn't matter what the price of beans is, if someone has more beans than someone else, he is relatively wealthier !! ... It's all relative, as Einstein was alleged to have said !! :-) ..."
I couldn't agree more - one of the main drivers of "poor moral values, self-interest and greed" (see post 75) is ENVY ... which drives/motivates people to want more than someone else, particularly those they compare themselves with, hence the term 'keeping up with the Jones's' - it's not absolute wealth that bothers most people, but relative wealth to those they continually compare themselves with, which drives poor moral values, self-interest and greed.
IMHO only a return of 'fundamental values' (e.g. trust, honor, responsibility, respect) will turn around 'economies' in a sustainable way now, and time is on no-one's side.
Sunday, 1 November 2009
I have included below a great comment made by a fellow blogger (writingsonthewall) in response to another post on one of Stephanie Flanders' blogs:
"... I would add to that and point out that the media's insistence on portraying lenders and investors as wealth creators is in fact a lie ....
... Can anyone explain how witholding resources (money) in order to engineer a situation that you can overcharge for the loan of capital and make profit is generating anything? In any other walk of life this would be described as blackmail - in business it's called 'wealth creation' ...
... Does that mean if I freeze frogspawn until I'm ready to defrost it that I have in fact become 'the creator' - i.e. God of the expected tadpoles? ... Surely, as the person who 'allowed the birth' of the tadpole I am creating life? ...
.... What do you mean I have only interupted it's natural progression? ... Oh dear, the idea that the wealth is created by any other means than applied labour to a commodity is laughable ... Manipulating scarcity is not creation of wealth, profiting from allowing progress and development to continue is not creating wealth ...
... That is why the system collapses, the monetary value placed on all the goods and services is actually far in excess of the actual value of those goods and services ... When the world works this out we get recession as we have to 'mark to market' our values and retract our growth expectations - the capital has to be destroyed - it happens unevenly so you get failures in sectors and particular businesses - i.e. Northern Rock ...
... Until the country accepts this is a lie then it will forever be bouncing from boom to bust ...
... Don't take my word for it - look at the Economy. Look at your lying politicans, your lying Economists, your lying bankers - they led you here and not one of them knows how to get you out. The only thing they can do is ask you to save their skins - by commiting yourselves to working longer and harder than you already do ...
... Not one of them will agree with me - which is a sure fire way of proving I'm right! ... Who's up for a debate about what wealth creation actually means? ...
... If the high net worth people are truly wealth creators - then why are they not creating some now? It's not like we couldn't do with some is it? ...
... Ah - because just as Gordon Brown took credit for the boom - when he actually had no control over it at all, the wealth creators can only take credit for their talents when the Economy is on the up ...
Coincidence? - or are they simply lying...."
Wise words indeed, and as far as ideas/debates about wealth creation go, I'm with them (e.g. see my previous post 'wealth creation vs wealth manipulation'.