Watch out for the deflecting of blame ...

Following my last post, it was interesting to observe the comments made on Flanders' blog (which resulted in me adding a few myself).  For me the key point arising is the risk of tarring particular generations with the same brush ... and starting to blame one another ... both of which are wrong.

One blogger (Boilerbill) commented ... 

"It is curious how an article pointing out that a certain sector of society has done relatively well, turns into 'the selfish generation'. Being selfish implies that there was something deliberate about what has happened - for the most part there wasn't. If there are villains, they are those who built the economic models - the economists and politicians.

I receive a public sector pension and for most of the time more was being taken in, than was being paid out - in fact we were subsidising general taxation. As early as the mid 70s those who had taken the responsibility for predicting our economic future should have seen that it was a Ponzi scheme and change it to a funded pension. People were complaining about paying too much - that would have been politically and economically right time to introduce a change which would have avoided part of the pensions crisis. In those days people trusted with handling money - especially savings - were held in high regard. Anything to do with pensions was regarded as boring but safe. People bought pensions wanting not be a burden on their children. They were not economic modellers.

This is just one example of where there may have been unease about what was happening and the economic modellers got it wrong. Like any person, you take what is on offer. You may question its viability, but when the experts tell you that it is OK, you go on and take it. The politicians are supposed to tell you how it is. In the past we were told that everything is going to be all right, but a bit too complicated for you to ever understand. It seemed all right so we re-elected them. Now we are told the future is bleak. Politically that is a good message to make - blaming it on Gordon won the election, but blaming it on a declining generation may win future elections.

There is a problem and the government is being over generous to some sections. The balance needs to be changed. The economic model which we were told would work has failed. But ask any of those born between '45 and '60 and they will tell you they were trying to build a future for their children. The fact that it didn't work out may be their fault for failing to understand the limits of the economic model, but there was little intentionality, so to label them as selfish says more about the accusers than about that generation" 

I had to agree, and commented ... 

"I agree. IMHO the key point with this article (and post 229) is that the small minority in power who practice Poweromics* (e.g. Politicians, Bankers) are able to do so (and successfully line their own pockets & flourish) without being challenged in a world surrounded by Ignoromics**. If you want to challenge Poweromics ... you have to reduce Ignoromics (as they are partners in crime).

IMHO there will be no new 'leaders' emerging whilst there are so few people wanting someone new to 'lead' ... and I'm afraid Ignoromics still prevails at this time hence it hasn't happened yet ... IMHO this won't be the case forever ... but things will unfortunately probably have to get much worse before it does ... unless people can find a way to fast-track the removal of Ignoromics, whilst those in power practicing Poweromics (and preparing for this) throw everything they can at them to stop them.

David Clift

'For evil to flourish, all it needs is for good men to do nothing' [Edmund Burke]

* Poweromics = People using position and power for their own personal gain, based on poor moral values, self interest and greed.

** 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 (i.e. Type 1 = Ignorance, Type 2 = Apathy).

and followed this up further by saying ...

IMHO the issue is less to age/generation and more to do with type of people we currently have in positions of power (e.g. Government, media, corporations, banks) ... i.e. Egocentric & Ethnocentric instead of more Worldcentric people (for definitions go to http://renegadeeconomist.com/blog/big-questions-hot-handle.html) ... e.g. take a look at a small extract from this link below:

"Introducing tighter regulations for bankers or politicians does not raise their level of maturity, morality or their ethics, it just limits what they can get away with. No, it is the type of people, the Ethnocentrics themselves, that have to go. Worldcentric people by definition and by their nature would not have abused the old regulations, let alone need new ones. Anyone below Worldcentric on the “chart” should not be selected or elected into positions of leadership in politics or big corporations, not just banks. Fewer people would fit the bill and that would limit our choice, and so it should.

The second of the two issues was the failure of commentators to seriously question the capitalist economic system that has proved to be so fragile and unjust. It has brought wealth to half the world while the rest starve; it thrives on excess consumption and the inevitable emissions, and it seriously retards the evolutionary development of individuals and cultures. Bankers and politicians alike strive to prop up the old failing system which they abused, because they know no better.

It did not occur to them that this was a golden opportunity to start to create a viable, sustainable economic system in line with the requirements of emerging Worldcentric human consciousness stage. Putting off the inevitable only makes the next economic crisis bigger and sooner. Worldcentric observers are amazed, distraught by the primitive ethnocentric thinking of our politicians and bankers, but they are up against the power that they still exercise. 

However there is also a groundswell of more conscious or ‘worldcentric’ people who will no longer tolerate the old order and they will become ever more vociferous until the ethnocentric majority of politicians are discredited, ousted and replaced. Some commentators will reread if not resurrect Karl Marx, but the way is forward not backwards. A new economic order is essential, one that puts people and planet before profit".

Moving forward I think we need to careful not to allow a deflection of blame to occur ... e.g. onto all the older generation, when the 'real people' 'stealing everyone's lunch' (breakfast, dinner, tea and future) are a few egocentric and ethnocentric people who currently have power (and misuse power).  However the issue that can probably be raised at most people's door is either Type 1 or Type 2 Ignoromics, which is the very thing that has allowed (and still allows) the egocentric/ethnocentric leaders currently in power to misuse power (and apply Poweromics).

Burdening future generations ... is this right, is it fair, will it work?

This is a key question we need to ask of ourselves ... as Stephanie Flanders has done today ...

In the national argument over Budget cuts, some voices are louder than others. This week there have been warning voices coming from the public sector unions - you can guarantee that they will turn up the volume in the months to come.

Ministers may not respond, but their voices will certainly be heard. It's usually a lot harder for politicians to hear the voices of people who don't vote. And of course, people who are aren't born yet can't say anything at all.

If you care about fairness between generations - that is a big problem. It suggests that the demands of older people will always attract more money and attention than the demands of the young.

It also means that future generations are likely to get squeezed. The wrangling over spending cuts this summer will greatly affect them too. But so far I haven't heard many people fighting their corner.

In his book The Pinch, the Conservative David Willetts describes in forensic detail how the baby boom generation has prospered from the core trends in Britain's economy and society over the last few decades, usually at future generations' expense.

To take just a few examples: high inflation helped them pay off their mortgages quickly in the 70s and early 80s - then price stability helped them preserve their wealth, just as rocketing house prices gave them another massive windfall.

They also prospered from an influx of cheap foreign labour from the mid 1990s onwards, just when Generations X and Y were coming on to the labour market, and a shrinking labour force might have helped push wages up.

Now David Willetts is in government - presumably defending the rights of tomorrow's workers as minister for universities. We've also got the youngest chancellor sitting at No 11 since 1986. You'd think it was a pretty good time to even the score between the generations.

But when it comes to generational equity, so far his plans for the public finances and the economy get maybe a low B plus.

For the purposes of this discussion I want you to forget about the distribution of Budget cuts by income, or region, or gender (see yesterday's post). Just focus on what it means for different generations.

Then look at the "tough choices" that chancellor made in his Budget - and the ones he ducked. It's not a black and white picture, but more often than not, the tough choices involve cutting services or benefits for young and youngish people, whereas the red lines tend to protect areas that are especially important for older groups.

Consider those benefit cuts: tax credits for families with dependent children are being withdrawn, with supplements for the youngest children removed and child benefit frozen for three years. A number of grants for pregnant women have also been abolished, and so has the Child Trust Fund. Lone parent benefits are also being cut.

By my reckoning, around £3bn of the £11bn in welfare cuts by 2014-15 that Mr Osborne announced in June will directly hit households with young children.

The rest of the benefit cuts come from changing the indexation of benefits from RPI to CPI (to save £5.8bn) and cutting the housing benefit bill by £1.8bn. Those cuts will affect people of all ages, but they are likely to affect older people rather less.

Why? Because the basic state pension was the only benefit to be increased in future years (alone among benefits, from 2012 it will go up in line with earnings, prices, or 2.5%, whichever is highest.)

Also, more than two thirds of people who claim housing benefit are of working age. Indeed, one of the arguments the government uses to justify using the CPI to uprate public sector pensions is that CPI doesn't include housing costs, which account for a much smaller share of pensioners' expenses.

Even more telling is the list of universal benefits that weren't cut. In line with the Conservatives' manifesto commitments, the winter fuel payment, free bus passes and free TV licenses for older people have all been protected, even though most of the £4.2bn a year spent on them goes to people who aren't poor.

The chancellor has said he's in the market for further benefit cuts which could make things easier for departmental spending. As one senior Conservatives said to me shortly after the Budget: "It's almost as if he's daring the cabinet to push to abolish the winter fuel payment."

So yes, this is a work in progress. But on the spending side, too, you'd have to say that older generations were being protected. The school building programme is being axed, and public investment generally is set to fall by half (a decision by the old government which Mr Osborne has not reversed).

By releasing local councils of their obligation to meet housebuilding targets, many experts say the government will help to prop up the value of the baby boomers' houses as well.

Times will be tough for the NHS, but it is the only major department whose Budget will continue to go up in real terms over this Parliament of pain. The figures on this are patchy and out of date, but in 2003/4 nearly 45% of total health spending in England and Wales went to the 16% of the population over 65.

At this point you may think I've completely lost the plot. Of course, you'll say, we protect the elderly, and the NHS. And of course most of its Budget gets spent on people at the very end of their lives. But that's what the welfare state is all about - not one generation stealing from another, but one generation doing for their elders what they hope their children will do for them.

All that is true. But, as Mr Willetts describes, the baby boomers have done rather more than that. They've fixed the system so that they get more money out than they are ever going to put in. He reckons the average member of this lucky generation will get 118% more in public benefits and services over the course of their lives than they have paid in taxes.

The key point is that a lot of the goodies that have been promised to the baby boomers (and the smaller postwar generation before them) will not be around for the generations that come after. So those young people are going to be paying more into the system than they take out. The longer that politicians wait to even the score, the greater the relative burden on the young.

The rise in house prices has tipped the balance even further the baby boomers' way - letting them consume more than other generations during their working lives and after they retire as well. To cap it all, they've presided over many years of government borrowing as well.

As Ray Barrell and Martin Weale from the NIESR point out in a fascinating article for the Oxford Review of Economic Policy, this imposes a double burden on future generations: not only do they have to repay all that debt from their own income (future) income, but that income may itself be lower because by borrowing for current spending, the government used up national savings that could otherwise have been invested.

This isn't about the rights and wrongs or running a deficit in a recession - or when and how quickly to bring it down. It's a much longer term question: whether this government, or any future government, is going to begin to take up the cause of younger generations, many of whom could face a much bleaker future than the generation now starting to retire.

Future generations don't care if we have a bad few years. As long as the Mr Osborne isn't derailed by a weak economy and actually follows through on those deficit plans, they'll give him a B plus for borrowing less than Labour planned.

But for today's under-40s and those to come, you'd have to say the coalition government could do better. 

To answer the initial questions raised ...

Is this right - yes it is. 

Is it fair - no it is not.  

Will it work - for a while it will ... but not for long.  


One needs to remember that the younger generations also have a choice ... i.e. they can choose where they want to live and work ... nb as one blogger immediately commented ... "I'm emigrating at the end of the month ... and to all the young I say, pack your bags, and leave tonight".


With no/fewer young people working there is no prosperous future, and anyone within the UK can move within the EU without restriction now ... with the floodgates now open, we are likely to see more and more hard-working people flood OUT.

Damned if they do, damned if they don't?

Stephanie Flanders recently posted the following blog - "... In many ways, the argument over the right way to support the global recovery here at the G20 summit in Toronto is the mirror image of the debate at the London Summit last year.

Back then the argument was that governments needed to act together to prevent another Great Depression. Now the worry is that they will hurt the recovery if they withdraw that support all at the same time.

But there is one crucial difference. In April 2009, any student of economic history could tell you which policies would maximise the chance of recovery - or at least minimise the chance of economic catastrophe.

The hard truth about today's situation may be that there is no perfect mix of policies that can guarantee a strong recovery after a financial crisis this severe, and a run-up in sovereign borrowing this large.

Put it another way: we could be damned if governments do cut borrowing rapidly - with the global economy still fragile - but we could also be damned if they don't ..."

I replied by saying ... "Countries need to acknowledge that traditional 'economics' has failed, was far to narrow in scope (and effectively a toxic mixture of Poweromics* and Ignoromics) and is now effectively dead ...


... and a new positive and broader form of 'economics' is now required (e.g. Leanomics - based on 'adding real value', as well as values such as trust, honor, responsibility, respect) if we are going to come 'Out of the Crisis' and realize true prosperity and (sustainable) growth.  

Dr W. Edwards Deming predicted this over 20 years ago, writing two books entitled "Out of the Crisis", and "The New Economics: For Industry, Government, Education".  His foresight was incredible ... and my work (including my own book ' Lean World'), and Leanomics, build upon his profound insight ... and there's a great deal to do if we are to going to not only survive ... but prosper.

House prices - An obsession with failure

Stephanie Flanders recently commented on the Nationwide saying house prices are the same as they were a year ago (i.e. no longer dropping), but asked if this is 'too good to be true' ... take a look at a few of the key issues raised below for instance:

"... house prices are rising in a market where very few properties are changing hands. As the Nationwide points out in today's report, the housing turnover rate - the percentage of the private sector housing stock changing hands on an annualised basis - is still only 4%. That's not much higher than it was at the end of last year, when literally no-one in the market wanted to do anything. Before the crash, turnover was 7-8% ...

... you might expect prices to carry on falling in a market with such little activity - because usually low turnover reflects the fact that everyone expects prices to fall. But the relationship breaks down if there's only a tiny number of houses up for sale. That seems to have been true for most of this year and it's still true ...

... if prices stagnate, or fall further, there'll be plenty who worry about the knock-on effects for confidence and the economic recovery. But it would be good news for young people who are otherwise bearing the brunt of this economic bust ...

... from an economic standpoint, the rise in house prices since the early 1990s has been a massive transfer of wealth from young wannabe home-owners to the older generations who bought when the going was good. It's worked like a tax on young people -and a windfall to large numbers of the middle-aged and old ...

... One way or another - whether through higher lifetime taxes or unemployment at a crucial time in the career - young people are going to be paying for this crisis for a long time to come. It would be no bad thing if they could at least come out of it able to afford a home".

To which I added the comments below:

A good article ... I've haven't read this blog for a while (partly due to poor journalism and partly due to blog spamming from a small minority) ... but having done so today it's good to see the quality of journalism appears to be improving slightly ... IMHO for economic recovery to resume in a sustainable way we need the folly/obsession with house prices to stop, we need to introduce a 'land value tax' into the economic system and challenge planning regulations / restrictions imposed to serve the interests of just a few (i.e. the landowners - e.g. Duke of Westminster et al).

More houses will then be built and young people will then be able to afford a roof over their head, without having to give most of their hard-earned money away each month to bankers in the way of interest. Some of revenues raised from a land value tax could also be re-invested into real value adding activities that create jobs and wealth (instead of manipulating wealth) which would create a more sustainable economy and reduce our debts, balance of payments and trade deficits.

A few areas your report does not refer to however are when interest rates start to rise again from their historic low (e.g. due to inflation from import costs rising with the increasing demise of the pound), continued job losses (and the impact/cost of this to the taxpayer and public debt), as well as lack of opportunities available to young people and the debt we are asking them to take on to go to University.

They will not forgive us, or the leaders who forced this upon them. We must also remember that hard-working people can choose where to live (ie. work and pay their taxes) and can move freely in the EU now too, and as more of them leave the tax burden placed on those remaining will start to spiral upward until they also decide to leave too ... the outcomes are entirely predictable, but an effective intervention strategy from this Government to deal with the problems we face is not.

Does Size Matter ?

Stephanie Flanders started a blog yesterday entitled "Does size matter?" ... but in my view it mostly missed the point ... so I have started to ask this question in a more effective way (see below). Stephanie (and the BBC) are clearly failing in their job (and their duty) so we'll have to do it ourselves instead ... Stephanie referred to QE (Quantatitive Easing), but I think there are much more fundamental issues than that ...

.....

Does Size Matter? .... Well I think the question should be "Does the Size of ..... Matter?" For instance take a look at few 'starter for ten' examples I've included below ...

* The size of our debt

* The size of the trade/budget deficits

* The size of the future pensions crisis

* The size of our untapped talent (unemployment, part-time, temporary working)

* The size of the innovation gap

* The size of the population stressed and insecure about their jobs/future

* The size of the waste (between 40%-90%) and frustration systematically created by out of date 'leadership' and 'management' practices

* The gap between what current 'leaders' are 'telling you' and what is actually 'true'

* The size of the gap between the 'leadership' we currently have and the 'leadership' we really need

* The size of the cover ups we now see

* The size of the greed/incompetence current leaders show

* The size of the culpability, current leaders will bear

* The size of the anger that is yet to rise from the people

* The size of the problem that will be eventually occur before most people decide to do something about it

* The size of the failure that will result from people not taking responsibility, or being accountable for what they do (and don't do)

* The size of the hypocrisy we now see

* The size of the gap between the behaviours we now see and the ethical behaviours (trust, honor, responsibility, respect - Leanomics) we now need

* The size of the 'backlash' likely to occur when most people realise what 'leaders' have been doing

* The size of the wealth being generated for just a few, and the expense of the many

* The size of the self interest/greed which will cause certain nations to collapse

* The size of the collusion that exist to stop progress/improvements being made

* The size of conspiracies that exist, to benefit the few and not the many

* The size of the group who 'manipulate wealth' rather than 'add value' and 'create wealth'

* The size of the arrogance of those in Power

* The size of the failure in 'leadership' we now see

* The size and number of scams we now see

* The size of failure and the lack of democracy people actually have (one of the biggest scams/spin of all)

* The size of the failure by mainstream education, and the impact this will have on us too

* The size of the failure created (and the lack of wisdom shown) by 'traditional establishments', and their failure to see this too

* The size and misuse of power, from all those in 'power' (Poweromics)

* The size of the group who do not understand this (an example of Ignoromics Type 1*)

* The size of the apathy from people at large (an example of Ignoromics Type 2*)

* The size of the collapse the nation is still yet to see

* The size of power hard-working people currently have but have not yet realised

* The size of change we have to come

* The size of the crisis will get before we see the changes we now need

* The size of our irrelevance in the world of the future

* The size of gap that will continue to grow, until people become more curious and take more responsibility for doing things differently

* The size of the gap between what current 'leaders' & 'management' do and what 21st century "leadership" & "management" is (e.g. take a look at the book Lean World)

* The size of the holes in the Government plan (or any other party's plan of action) for doing anything about it

.....

.....

.....

This is a just quick list I've started off ... and everyone's welcome to add to it here (and in future blogs) too ... Take a look at this (the blog here) for more (*and definitions of Type 1 Ignoromics and Type 2 Ignoromics too), as it'll add more and more (including yours), along with a few examples too ... (Leanomist Post 70)

......

Here are the definitions of Type 1 Ignoromics and Type 2 Ignoromics ...

Ignoromics (Type 1) = People are either effectively ignorant of the situation (e.g. the overall environment).

Ignoromics (Type 2) = People aware of the overall situation, but not prepared to take responsibility to make sure it changes for the better.

I have highlighted the above so we can start to reduce them, and address some of the Poweromics that's resulting in much of what we see above today .... Leanomics is about showing respect and taking responsibility for improving the situation for others .... and without this soon all the above will unfortunately resign us to history (as a failed & irrelevant nation) ...

NB Type 2 is arguably what applies to the BBC (and Stephanie Flanders) as they clearly understand, but fail to take responsibility for doing anything about it. It's worth noting that Stephanie likes to tell us that she went to Havard, and that many of her friends / colleagues just happened to go to such places too ... so perhaps we should not be surprised, particularly given the report issued by Alan Milburn (on the same day), highlighting how positions are obtained in such establishments (which includes journalists and the BBC), and how they 'promote' their own ... their own people, ideas and incompetence!

It's a shame that 'leaders' have not yet realised, that just like most MBA's, such establishments are "Maybe Best Avoided" ... !

This post was also referred to on "The shrinking economy' too (Leanomist Post 9)

The 'Winds of Change' are here ... but when will the UK 'catch them'?

The winds of change are blowing, but when will UK 'leaders' harness them ... rather than resist them?

In Stephanie's blog today (what will it all cost?) the comments made tell us far more than the blog, but this cannot continue forever ... as Stephanie reads the comments, and Stephanie & the BBC have a moral duty to inform and a civic responsibility to perform* (as we the tax-payer pay their salaries) ...

For instance, take at this blog entry, and in particular the first dozen comments made (as well as my comment below). I hope Stephanie takes her responsibilities seriously (e.g. see my previous post here), and starts to challenge the traditional establishments (eg the 'economic', 'political' and 'academic') who are stopping us, our children, and our children's children from having a better future ...

* NB it looks like Robert Peston's having a go (along with the people who comment on his blog) ...

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Post 17 (leanomist) wrote ...

There is so much insight in all the comments above that will affect us all, our children and our children's children ... and there are already too many to mention as they all arguably tell the story of what's happening now, and what lies ahead ... which begs the question "So why are current 'leaders' in positions of 'Power' not 'seeing' it, or doing anything about it ? ... is it mostly 'Ignoromics' or more 'Poweromics' ?

* 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.

As I personally don't see much Leanomics* from them, which is what we really need from our 'leaders' right now ... and IMHO " Leanomics v Poweromics & Ingoromics " is arguably the 'battle of the future' - which will define the nations that will prosper in the future ... e.g. take a look at the link below too ...

http://poweromics.blogspot.com/2009/06/leanomics-v-poweromics-ignoromics_01.html

Such a 'battle' is arguably just beginning, but it will predictably grow (powered by the internet) as things continue to slide and get much worse ... (I personally believe this is partly why we are seeing so much 'spin' right now ... as those in 'power' try to 'hold back the winds of change' ... but as has also been pointed out above, they are going to blow whether they like it or not, and in places like Japan they're likely to embrace them yet again ... I'm afraid 'history tells a story ... and it will continue to do so too').

David Clift, a Future 500 Leader

* 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.

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Will Stephanie help change the course of history?

Is Stephanie prepared to help us face the challenges ahead? ... Take a look at Stephanie's latest blog, my previous post, and my comments made earlier today too (below) ...

Stephanie has already read a lot of the comments made on her post, and has already responded to some of them too ... I'll keep you posted with what happens, and let's see if Stephanie Flanders is up for (and able to help with) 'changing the course of history' ...

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Post 239 (leanomist) wrote:

Post 197 Stephanie Flanders (following Stephanie's response to a previous comment).

Well done for starting this post and for taking the time to read the comments. There is a lot of invaluable insight available in this post ... and having started this off, there is arguably a responsibility for yourself (and the BBC) to follow-up on it - so can you tell us what you plan to do now please?

I have pulled one quick thread together for you (focused on 'changing the course of history' ... see the link provided below) ... and there are clearly more threads too ... I look forward to your response and to watching progress made with interest ...

http://poweromics.blogspot.com/2009/07/history-tells-story-and-it-will.html

This a journey of a lifetime - and one our nation cannot afford you (and the BBC) not to take - please don't disappoint us (it's arguably become a civic responsibility now). You have quite rightly opened the door and now is the time to step in ... good luck ... we're supporting you (so long as you go through the door now, and don't allow all the 'traditional establishments' to immediately deflect/dismiss everything and/or to quickly close ranks).

David Clift, A Future 500 Leader

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History tells a story ... and it will continue to do so too!

Stephanie Flander's blog "Is economics a busted flush" turned out to be a great blog with lots of great comments & insight. It raised many issues (and many responses) see my two earlier posts "traditional economics is dead" and "traditional education is failing" ... but it has also much to say about 'creative outsiders', history, and the 'future history' too ... for instance take a look at a few of my comments (and others people's comments) below:

... 'Creative outsiders' (such as Dr. W. Edwards Deming) create breakthroughs because they are not constrained by existing frameworks and accepted norms (e.g. steered by mainstream education/practice). They are also naturally curious, ask lots of basic questions, and are often able to see things in a very different light. Traditional establishments/enterprises are well known for becoming almost 'blind' to new concepts/ideas ... they regularly reject (and sometimes fear) them too (for as long as they can at least) ... because they often undermine much of what they had previously come to understand (e.g. see Einstein, Galileo, Newton, Wegener ...) and it may not fit their frame of reference too (e.g. created by traditional mainstream education). This is why businesses regularly get overtaken by more innovative ones ... and it is 'why nations will fail' if they 'fail to be curious' too ... and it turns out there is a subtle cultural element to this too [Q: and do you think this favours countries like the UK/US?] ... This is turning into a very interesting/insightful discussion/blog ... well done for starting it off Stephanie .... (Post 88, leanomist)

... and the response to the question ... "Well yes, it favours the UK but it does not,,,now.,.favour the US. The problem with the US is that on the whole it is too conservative. It favoured Europe because there were a lot of independent thinkers (aka. rich, spoiled brats) who got into science. Those thinkers ran off to the US, but since WW2 they have been heading back to Europe and India, and with their departures the USA share of global GDP has been dropping. This is the kind of demographic megatrend that really shapes the national economy, and it transcends national policies. I think that we might see changes now - as Western enclaves like Shanghai in China become more attractive as places to REMAIN, as opposed to platforms to move on to MIT or UCLA, then the number of patents per locale per year (interesting metric) might shift in favour of China" .... (Post 98, FrankSz)

... and my response ... "The shift in knowledge creation from West to East is an interesting one, and this video is probably worth a look if you haven't seen it before (it also eludes to more fundamental failures in education too - which this blog has also been discussing). People from the far east also turn out to be more questioning and curious on average too. The east is also starting to train lots more scientists themselves as well, and some research establishments in the UK are already moving their work over there instead of doing it in the UK. A mega-trend indeed (with both short term and long term implications), and one that links well with the point I tried to make earlier - i.e. 'why nations will fail' if they 'fail to be curious' (nb and/or 'fail to understand, or act on, what they find!'). As we say, interesting times ahead - and another good point which shows yet more weakness in traditional economics, as well as some of the fundamental weaknesses in our economy (... you may also be interested in this blog too) ..." (Post 109, leanomist)

... and moving on to consider a little history (and the 'future of history') ...

... "Dr W. Edwards Deming was a US citizen who was mostly ignored in the US and went to Japan (who welcomed him with open arms) - and the US/UK had to quickly send a task force over there to try to understand what companies like Toyota were doing differently to General Motors - which turned out to be virtually everything - and was effectively the start of the 'lean movement' - and guess what most in the UK/US still don't 'get' this, or understand it - and guess what happened to GM? ... a $170bn bankcruptcy (the biggest in US history). History tells a story, and I'm afraid it will tell many more in the future too ... which is partly why I'm charting everything and highlighting some of risks that lie ahead" ... (Post 149, leanomist)

... and in response to the following question "Somewhere around 60,000 people in the UK now have an MBA. Has anyone ever looked at what impact this has had on the economy in the past 20 years or so?" ... this historical perspective was added too ...

... "I personally believe history will answer this by simply saying 'they were part of the team that got us where we are today' ... GM (and most other US/UK enterprises for that matter) have a lot of them, whilst companies like Toyota are well known for MBA's, but for their lack of them ... I think this, in a small way, partially supports this kind of assertion too ..." [NB this is referred to in my book too]. (Post 171, leanomist)

There are interesting times ahead, and as I mentioned above, this blog is helping to chart everything whilst highlighting some of the risks that lie ahead ... so we can hopefully avert some of them*, 'change the course of history' and avoid us 'becoming history' too ! ...

* as 'Those who don't know history are destined to repeat it' [Edmund Burke, 1729-1797]