Friday, April 14, 2017

Jobs jobs jobs: why did voters start to go crazy this year and what’s next?

There are several very serious international studies going on on the long-term problems of unemployment, and on the forces which caused a lot of public rejection of the establishment this year in the US and the EU. Those forces are not going away, by a long shot.

In one of the international discussions, a leading person from Silicon Valley suggested we read the views of a top guy at Harvard:

That’s a very honest and well-informed discussion, but it doesn’t get so deep into the roots of the problem, where it could lead us in the future, and what we could do about it. In response, slightly before his  post, I posted my own views:
A few weeks ago, I was very depressed to see the conclusions of multiple, parallel independent international studies on the future of work, coordinated by the Millennium Project:

Before then, I could see ways to improve the unemployment situation drastically, especially in the EU, requiring a lot of creativity and insight and flexibility but within the established paradigms of macroeconomics, a field I worked in for ten years before moving to NSF. (Built large econometric models used in DOE official forecasts, probing data from specific sectors as would be needed for solving EU austerity versus jobs problems.) But it seems we really are entering into a radically new era, where the political discontents and problems of US and EU this past year are just small harbingers of something much bigger and scarier, beyond those traditional paradigms. I have very deep respect for David Nordfors in trying to get more real mental energy and consciousness applied to this complex challenge
(and respect for Jerry Glenn of the Millennium Project as well).

The three scenarios which survived the scrutiny of many policy analysts all over the world... included two very scary, and one "optimistic." But the optimistic one required a certain amount of deus ex machina from the IT community, and it is clear that we need a more worked out and different "third scenario" here.  (Fourth scenario?) 
At, I have posted my own groping thoughts 
(just six slides!) about a possible way through the scary jungle ahead of us, requiring 
a lot of the things you all have been discussing, and more, and some integration to hold it together. Where is a full fourth scenario possible, worked out more concretely and more ready for implementation?

I am somewhat more optimistic about "permanent income" than most folks I know, because the Basques have done some great experiments; whether they should count as part of "permanent income" or not is a meaningless semantic issue, so long as they work. Yet other more powerful ideas are needed to solve most of the problem. 

As always, there is a lot more which needs to be said about these threads, but this post is already long enough.
For the blog, I will elaborate on just one thought. The future scenarios now under discussion remind me a lot of what a management consultant tells me about the development of new products. At a certain stage of product development, he tells me, about half the people are jaded, pessimistic, unable to do much that is useful, while the other half is mainly delusional. Actual movement forward in reality depends on the thin green line of pragmatic or sane people between those extremes. We need a new way forward from the middle, and we need a lot of hard thinking about how to make it work. My six overview slides reflect my own best thinking at the time, but more integration and detail and action are all needed. If we care about surviving.

Well, one more aspect should be mentioned. The growing problems are also related to issues of corporate governance. There was a very important and illuminating new book by Paulson (former head of Goldman Sachs) which I have mentioned before, on dealing with China. Paulson explains some of the important reasons why economic reform worked in China so much better than in Russia. In essence, the Russians brought in great theorists, like Sachs, while the Chinese brought in people who focused directly on changing corporate culture. As Paulson explains, it worked incredibly well in expanding economic growth for awhile, but certain limits started to emerge... relevant to what's happening in US and EU.

A family member has been looking into these issues of corporate governance, and I commented:
In general terms... the shift from owner-run companies to manager-run companies is indeed a really major issue. Ironically, I remember my own father talking about that growing/emerging issue 'way back in the 1960s!! And Luda and I just discussed it a lot this past weekend with Stuart Umpleby, a professor emeritus of George Washington U School of Management.

Since owners and CEOs have both had enormous political power, the management of this relation has been a big issue for a long time. 
About ten years ago, I would say that two oversight organizations played a strong role in making sure that the interests of the owners are better represented, even as managers run things.

Come to think of it, Boards of Directors also do some of this. Oversight of CEO by COB and Board is one vehicle, supposed to be a bit like Congress overseeing President (which has fluctuated a huge amount).

But the two big ones were: (1) SEC; and (2) 7 sisters (now much reduced).

During the election, Hillary Clinton gave a fervent speech one day about how terrible it is that a government agency, SEC, is forcibly making sure that public corporations focus entirely on maximizing profit or net worth (by whatever metric) and not considering other larger social values and needs. Charles Koch, owner of one of the two big privately held companies
(the other being Cargill, also rather powerful but more specialized), praised that comment and asked to meet with her to talk about that. It was funny to see the expression on her face when that public invitation was publicly rejected! But in any case, there is a huge community dedicated to ethical investing (a good google search term) trying to change the worst damages from that; one of the leaders is Hazel Henderson (another google term), who has been quite friendly to me and LUda in our occasional crossing of paths, some through the global futures Millennium Project (Jerry Glenn's outfit) where she and I both serve on the Planning Committee. 

About ten years ago, Arthur Anderson (en?) and Deloitte Touche were 
the two really big members of the Seven Sisters. Many people said that these seven relatively small companies were in fact more powerful than Congress, deeply penetrating the structures of all the Fortune 500 companies, setting rules and guidelines and advice which they knew they had to respect a lot because of stockholder clout. Both companies understood very well that CORPORATE CULTURE is absolutely central in deciding how well run such companies really are, how much freedom 
and empowerment and mobility is really offered to all the people who work for such companies (the bulk of the work force), and so on. This is so important to real people and real freedom that I have worked hard to track that literature, fragmented as it is.

Do you remember R? We still have about once a year super friendly serious discussions, and expect to have more. He was the partner in Arthur Anderson Consulting (the part which set rules and oversaw corporate culture) who was their top expert in systems theory and cybernetics approaches, aimed at developed the most effective possible corporate cultures and management procedures and leadership and training and such.  It was his job to keep up, and to run the in-house training and updates requires of all people in front-line consulting... all major corporations! But eventually, there was a scandal, not unlike what happens with Congress from time to time, but this time the firm was dispersed, and R mainly runs his own operations, most notably ... Climate change was a big part of what Anderson explained, and perhaps the demise of Anderson might have some relation to some decay in management in US (and the political apparatchiks under its authority).

As Anderson was decaying, DeLoitte hosted Jerry's planning committee meeting one year in their offices downtown, which I had also visited for links with Senator Specter.   They were debating "what is sustainability? What can we say about it?" I said: "Sustainability is what Arthur Anderson didn't have... It's what you have to change when you are in a situation of 'change or die."  But I do not know whether they still work with Jerry on support for his activities, which, informing people about the future, would certainly be important to any rational type of corporate strategic planning. Intel does,
and we are part of that. In fact, since it is only six slides, I attach the overview I put together myself as part of that, following up on Jerry's global report on the future of work and employment, a top concern of many now. 

Well, please forgive me for the length of this. There is stuff about books from Sage, DeLoitte's Culture Print, corporate anthropology,  Exxon versus Shell at SEC... and all the obvious forms of corruption which powerful CEOs use to avoid SEC and consulting oversight, and in some cases to suborn governments all over the world (like the Sinopec guy Zhou who is now gone but got away with unbelievable stuff of global importance). 

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