Well, after the to and fro of Greek political and economic system we all have realised, regardless where we stand, that the system acts like a dynamic open complex system and not as a pendulum. Newtonian physics and its replication in economy and society not only can’t work but also can’t depict and model the dynamics in Greece.
Economy and Society cannot be portrayed (modeled) as smooth water movements but as sand grains in a pile of sand. Here and elsewhere[i]. Economy and economic, fiscal or financial actions behave like sand. You cannot add sand over sand expecting that the pile will behave eternally in equilibrium just as actions (and transactions) one over the other. There is a critical and certain pieces you can pile in a secure way in order not to have a collapse. When you over exceed a critical number (ie Z=3) the system collapses[ii].
It’s a multi agent game and unless there is cooperation between agents the system will crack. The consequences will be immense and not related to the initial conditions.
Specifically for Greece, the situation was profound years ago. False and fake development, ephemeral wealth with virtual money that directed not to real economy but to the virtual one, culminated to a catastrophic result for the majority of the people, companies and the state. Now we are living within a living hell being unable to guarantee that wages, pensions, incomes and lives will maintain a certain level of viability. No one, a minister, an analyst or who else, can assure the previous levels of living. Unfortunately this is the pure truth.
The system tries to convince society that the public sector is the only (or the major) responsible for this hellish situation. But who comprises the system? All of us. There is the mega system, with sub systems and sub-subsystems. Continuous erosion of sub systems for many years resulted in today’s reality. Nobody wants to accept responsibility, openly. Apart from the rhetoric of the political system that “we all ate it together”, – regardless in a 5 Michelin restaurant or a tavern- apart from the reactions of the syndicates etc there is one truth. System is under collapse. And this system needs a radical change –from within-. Measures over measures, fiscal cuts, over exploding unemployment, wages slaughtering, unpaid loans in banks, we grasp – among many others- that Greek debt is not viable and sustainable. Interest grows exponentially though GDP[iii]grows in a linear and negative manner. The predominance of numbers over people causes effects beyond every imagination. Continuous budgetary adjustments cannot fortify economy and definitely dismantle society which by definition is entropic. But how can you play with numbers if you fool people? The dilemma of preferring less and less money instead of no money at all is not the right question to ask. System has to understand that it exists because of the democratic acceptance and willingness of the people to participate in the making of a democratic and secure environment. Collapse can be an outcome of a non deliberate or organize reaction by groups or anti-systemic forces.
Saving the banks is not the only option. Saving the people is the prerequisite of a wealthy society and a welfare state. Some decided that the Keynesian model is not functioning anymore, whereas Chicago boys take their revenge from that English Solon. They see state intervention as hell on earth and unleash a series of measures that can reestablish the natural order of things. This is wrong beyond doubt. People/citizens gave the alibi to clans of money to cast a doom to social and human rights. It’s a matter of reestablishing equilibrium (people fear living away from equilibrium). But what equilibrium that should be? By breaking the necks and bones of the middle class and civil servants that use to pay all their taxes like another Procrustean beds? Or by considering that Sisyphean martyrdom is the solution to greed and wealth redistribution in favor of the upper class?
Sudden death is not an option. And they know it. Like frogs on the slowly heated pot, we are animals under scientific scrutiny and observation. How far can we go without losing our patience or skin? How far can we pay our debts to the banks without getting crazy? How long can we pay for a debt that increases instead of diminishing?
Economic wars reshuffle the game from the beginning. Strikes are a reaction of the previous century. By participating to this rotten game regardless our willingness to change things, it’s a mere futile scope. Monetary system as we know it and as it functions is a quicksand. On the same level overregulation can cause similar effects to society and economy.
The epitome of Per Bak’s thoughts[iv] from the book “How nature works- the science of self organized criticality” is that“…this very efficient situation would collapse even before the self organization. Greenspan and Marx failed. The most resilient situation for an economy would be the decentralized self-organised critical situation of the capitalist economy, bearing fluctuations of all sizes and durations.
Volatility of prices and economic activity could be irritating (especially when you are hit by that) but finally there is no something better that could have happened. Self organizing critical condition with all its volatilities is not the best possible solution. It is tough the best dynamic plausible condition”.
A sound proposal, an inevitable need or a much needed utopia?
It is acknowledged that a highly complexity problem of this magnitude due to the number of agents, the variety of interests that are contradicting each other, the social needs, and the necessity to live in a secure environment by protecting democracy and rights cannot be solved through a unique solution imposed from the top. Of course, the sequence of added mistakes and false solutions to falsely defined problems is obvious. For sure we cannot cope with problems presented as only economic and fiscal ones, whereas the scope of them is multi-faceted and multi-oriented. Definitely we cannot solve problems attributing them only economic characteristics and origins and discuss them as if we were living in the 20th or even worse in the 19th century era. A new social contract is in need not only for Greece but for Europe and globally. Money – bad money- as we use it, is the core of malfunctions. Our ecosystem needs strong leadership and the understanding of States that local societies can play a major role in the reconstruction and through reassessment of trust and resilient behavior they can offer viable solutions. Democratic participation and collective action must be the essence of our society. National, supranational and international organizations can make a giant leap forward. Living in Chaos is a situation that people cannot stand for long.
Michael Dekleris[v] mentions that a viable state needs to follow certain rules (Values’, Communication, Hierarchy, Control Environment, Relatives’ personal System) in order to reestablish trust and healthy connections among players.
Bunches of the problems we are facing are focused in environmental degradation according to Jared Diamond[vi]. Societies have fallen due to societal malfunctions and wrong judgments throughout human history. “It seems to me that the most serious environmental problems facing past and present societies fall into a dozen of groups. Eight of the 12 were significantly already in the past, while four become serious only recently”.
We are far from the Gaussian curve and its implications to society and economy, environment and beliefs. The long tail, the fractals, the autopoiesis as well as homeostasis the law of Power and Horton’s Laws, model a new world and a situation that cannot be forecasted. It’s a mere illusion to forecast (though fortunes are made of it). It’s additionally an utter disillusion that we can stay still and wait for things to change. New forces exist everywhere. Daily they are created in highly paid labs but also in classrooms and in a living room placed pc. The game of life and boids show that only a certain amount of rules need to create order out of chaos and societal ataxy. People and their elected representatives have to understand their capabilities. Actions are not futile. Non Actions are. In every time spot a bifurcation is created calling us to act. Economics as they have prevailed are not offering a viable solution. Markets cannot act as bulls in a china porcelain shop. And profits are not above people. Elected governments must act on behalf of their people. Synaptic bonds have to be established among us. Coordination is easiest than ever before. Hence, local and regional governments in cooperation with the central governments have to set legal rules within the frame of an “emergency need situation” and preserve the right of their people to live and prosper. We need iconoclasts to lead people to a new Land of Hope and Prosperity. The distribution of wealth seems to follow Mathew effect[vii] or “cumulative advantage”. Success breeds success and failure begets more failure. But what we need are societies that people can live decently, pay their taxes fairly (all of them according to their incomes and wealth) and can dream of their and of their children’s future. Local governments can play a crucial role because they are the proto-cell of democracy and society. Hope has to start regain territory over the ocean of volatility.
Crawling restless in a terra incognita must become a sound writing of co-existence new contract in a terra rasa. How this will emerge is a fundamental question and it depends on us and randomness alike. The offered and proposed solutions are very expensive for the problems we face. Politicians, citizens and pressure groups of any kind have to understand this. Wanted: Hope.
[i] Per Bak: How nature works- the science of self organized criticality, katoptro editions (in Greek), Athens 2008.
[ii] Op.cit.
[iii] Happy Planet index. http://www.happyplanetindex.org (A n innovative way to measure happiness)
[iv] Op.cit p. 274
[v] M. Dekleris, “Introduction to Sustainable State” p.92, table 11, Sustainable World editions, (in Greek), Athens 2005
[vi] Jared Diamond, Collapse – How societies choose to fail or survive, p.486, Penguin books, 2005.
[vii] Nassim N. Taleb, The Black Swan, pp 216-217, Penguin Books, London, 2010.