Analysis of Subproblem B - How to Achieve Life Form Proper Coupling
If you reached this page before reading the Summary of Analysis, read it first. This will give you a bigger picture.
In this subproblem we wrestle with the 8 million pound gorilla who is king of the mountain. He climbed the mountain so fast and in such cunning silence that most people are unaware he's on top. They blindly go right on assuming that people control democratic political systems and laissez-faire economies.
Ignorance is bliss until the side effects of corporate dominance begin to appear in the form of unjustified wars and more, as listed in the illustration below. Click on it to read the full article.
The 8 million pound gorilla is the corporate life form. He consists of the world's large for-profit corporations and their many employees, allies, and supporters. He's become the new dominant life form by accumulating such overwhelming competitive advantage that he controls the political system like an invisible puppeteer. All he has to do is pull the right strings and the system jumps this was or that. A little money here, a little influence there, or a corporate proxy put in office here, and the Homo sapiens puppet dances to any tune Corporatis profitis wants to play.
This page summarizes how we can cut those strings and put Homo sapiens back in control.
Substep A - Find the immediate cause of the problem symptoms in terms of the system's dominant feedback loops
A review of the history of trying to solve the sustainability problem shows that large for-profit corporations are dominating political decision making destructively. That symptom screams out for explanation and solution. It's such a large roadblock to solving the problem it justifies its own subproblem.
Proper coupling occurs when the behavior of one system affects the behavior of other systems properly, using the appropriate feedback loops, so the systems work together in harmony in accordance with design objectives. Here the two systems are the top two life forms in the social system, corporations and people. They are improperly coupled because the right balancing feedback loops are missing.
As I'm writing this (in November 2011) a political storm is raging outside. The Occupy Movement has occupied dozens of city centers in the US. The movement appeared as frustration boiled over about the excessive control large for-profit corporations and the super rich enjoy over the vast majority of citizens. This has caused high income inequality, the 2008 recession, and high joblessness.
My wife and I went downtown to the occupation in our own city, Atlanta, one Saturday. Chatting with the protesters for a few hours, I could detect no deep understanding whatsoever about the forces they were up against. This is normal. Then we marched to the capital and listened to speeches. Again, there was no deep understanding of the problem they sensed needed solving. There was only anger, wish list demands, and well crafted rhetoric. That changes little, I thought, as I quietly listened.
A few months ago I attended an environmental organization conference at the state level. It was small, about 70 people. Most had been working away on the sustainability problem for years, with little progress. That seems to have caused attendance to fall by half over the last decade. It was a silently demoralized group. Chipper on the outside, despondent inside. The national leader of the organization flew in for half a day and gave a speech. He connected well. But he had nothing new to offer other than another direct action campaign on the burning of coal in the US. It was going well because the alternatives have recently become cost effective. But the problem the campaign solved was a drop in the bucket. And it was a drop in the bucket too late, considering how many millions of tons of CO2 coal burning power plants have pumped into the atmosphere. This organization is changing little, I thought, as I quietly listened.
In late November 2001 I visited the Club of Rome's website. I was briefly a member of the US branch and tried to introduce the concept of root causes analysis. The folks were friendly at the international level, but I got nowhere. So I thought I'd see how the organization was doing. There on the international website's About page was this statement:
The Club of Rome is focusing in its new programme on the root causes of the systemic crisis by defining and communicating the need for the vision and the elements of a new economy, which produces real wealth and wellbeing; which does not degrade our natural resources and provides meaningful jobs and sufficient income for all people. The new programme will also address underlying values, beliefs and paradigms.
So maybe my work did nudge the elephant. "Root causes" was not there before. But if you examine the site you will find no real analysis, no real root causes, and hence no significant progress on the problems they're working on. Just look at the above quote. One does not find and fix root causes "by defining and communicating the need for" a wish list of what you want.
The Club of Rome, the environmental organization, the Occupy Movement, and thousands of other public interest organizations are trying their best to solve their problems. Most sense there are powerful forces holding them back. But those forces remain invisible because they have not brought the right tools to bear on the problem. If those tools were well applied the world's activists would come to about the same conclusions that our analysis has: that of all the root causes of the sustainability problem and other common good problems facing the world, at the very bottom lies a single ultimate root cause. It's the cause of the root causes of the other three subproblems, as explained in this diagram. If we can fix the ultimate root cause, then all these common good problems will solve themselves in record time because the most powerful agent in the system will now be working for the common good of all instead of for itself.
That agent is Corporatis profitis as explained above. To find and resolve the root cause of corporate dominance, we first put it in its own subproblem. The symptoms of the subproblem are rampant corporate dominance of society, including dominating political decision making. That dominance is destructive, as seen in the side effects listed in the above illustration.
The symptoms are best analyzed by considering this as a form of improper coupling. The improperly coupled systems are the corporate and human life forms. They are not working together in harmony, but clashing and fighting for system control. Humans are losing badly because Corporatis profitis has become adept and pulling the right strings and getting political system to dance to any corporate tune desired.
How the Corporatis profitis puppeteer is able to control how the Homo sapiens puppet dances has been studied. The analysis model is The Dueling Loops of the Political Powerplace.
The model contains two main loops. The race to the bottom is controlled by special interests, while the race to the top is controlled by those seeking to optimize the common good. Currently the race to the bottom is dominant, as shown by the way mass political deception causes mostly corrupt politicians to be elected. The chief special interest by far is large for-profit corporations. They've figured out how to exploit the inherent advantage of the race to the bottom by getting voters and politicians do support decisions favoring corporations instead of people. A dominant race to the bottom is thus the immediate cause dominant loop.
The puppeteer is Corporatis profitis. The puppet is Homo sapiens. The strings the puppeteer uses to control the puppet are false memes, also called deception or falsehoods. The strings are invisible because if deception goes undetected, the mind cannot tell a false meme from a true one.
Substep B analyzes what conventional wisdom is seeing and doing. Activists see the cause of corporate misbehavior as one of disagreement from corporate proxies on what to do. Activists think this is the root cause when actually it's the intermediate cause.
If your opponent disagrees with you, then it's obvious what you need to do to solve that disagreement. You need to use logical and emotional appeals and bargaining to try to get the other side to see it your way. That reasoning works for simple problems, like getting support from your coworkers for a proposal. But on the sustainability problem this simplistic reasoning doesn't work. It's a low leverage point because it doesn't resolve the root cause. It pushes at the wrong place in the system, which causes pushing there to required vastly more effort to solve the problem than if it pushed in the right place. Activists don't have vastly more force to apply than the 8 million pound gorilla. They have a lot less, so any solutions applied at this leverage point are guaranteed to fail.
But activists don't know that, so they blissfully go right ahead with symptomatic solutions like corporate social responsibility appeals, green investment funds, NGO and corporate alliances, etc. Solutions like these are symptomatic because they treat the symptoms instead of the root cause.
Corporate Social Responsibility (CSR) campaigns involve appealing to the moral responsibility of corporate managers. CSR has created a big buzz but has largely failed. Why? "Milton Friedman and others have argued that a corporation's purpose is to maximize returns to its shareholders, and that since only people can have social responsibilities, corporations are only responsible to their shareholders and not to society as a whole. Although they accept that corporations should obey the laws of the countries within which they work, they assert that corporations have no other obligation to society." (source)
The idea behind green investment funds is some people are willing to accept a lower rate of return because they want to help the environment. But in reality, people want a rate of return nearly as high as other funds. This forces green investment funds to invest in non-green or less green stocks to keep their portfolio average rate of return high enough to attract customers. The result is: (source)
Critics accuse "green investment" funds of hypocrisy - Investment funds branding themselves as socially responsible have enjoyed strong consumer interest, billing themselves as "green and gold" and able to get a good return on retirement savings, while helping to save the environment and promote human rights. But critics are now accusing them of hypocrisy. New research reveals that all but one of the funds that promote themselves in this way in Australia, invest in fossil fuel stocks and one leading fund is even investing in the global cigarette industry giant, British American Tobacco.
...we found that 15 out of 16 SRI funds are actually investing in fossil fuels and then you compare that to renewable energy and there's only 12 out of 16 investments in renewable energy, and surely this should be a popular investment by these funds because they are touting themselves as some sort of a sustainable alternative for the investor. Why do the ethical funds put money into fossil fuels? One reason is they're anxious to match the returns of the mainstream funds.
NGO/corporate alliances have had near zero impact. For example, the Apollo Alliance "is a coalition of labor, business, environmental, and community leaders working to catalyze a clean energy revolution." Founded in 2001, what has it actually accomplished?
The plan was "the Apollo program would generate and invest $500 billion over the next ten years to accelerate the development of our vast clean energy resources, dramatically reduce carbon emissions that are destabilizing our planet, and transform America into the global leader of the new green economy."
But it didn't happen. All of that $500 billion that actually came to pass was "inclusion of $25 billion in the 2008 federal economic rescue package for low-interest loans to auto manufacturers to retool their factories to make cleaner vehicles. Apollo worked with Michigan Senator Debbie Stabenow to secure the loan provisions and funding." That's another drop in the bucket that makes almost no difference. Furthermore, if auto manufacturers really needed that money they would get it from somewhere. Getting it at a low-interest rate from the government does not stimulate sustainability. It stimulates industry asking for more subsidies.
Subproblem B analyzed how popular solutions are trying to solve the corporate dominance problem. They're failing because they're pushing on low leverage points with symptomatic solutions. Now that we know what we shouldn't do, let's analyze what we should do.
Substep A found that The Race to the Bottom among Politicians is the immediate cause dominant loop. Substep B found the intermediate cause of this is disagreement from corporate proxies on what to do. What is the root cause of that intermediate cause? That the same asking what's the root cause of why The Race to the Bottom among Politicians is the dominant loop.
The loop is dominant because Corporatis profitis has figured out how to exploit the inherent advantage of the race to the bottom. Because the race the bottom is dominant and the race to the top is not, voters are fooled into electing politicians who favor special interests over the common good. This causes benefits to large for-profit corporations and the rich to rise, while benefits to everyone else stays flat or falls. One result is important problems like environmental sustainability go unsolved.
How the inherent advantage of the race to the bottom works is crucial to grasp. Examine the model closely. The size and hence the appeal of a falsehood can be inflated but the size of the truth cannot. For example, during an election campaign a degenerate politician can promise something he knows he can't deliver. Or he can inflate the likelihood of something bad happening, like a war or recession. Or he can inflate how bad his opponent is through fallacious ad hominem attacks.
Meanwhile, his worthy opponent can use only true memes. She can tell only the truth about what's possible. She can't promise more than she can deliver. She doesn't inflate the probability of bad things happening, so she can't scare voters into supporter her. Nor can she inflate how bad her opponent is via ad hominem attacks and false negative campaigning claims, because she tells only the truth.
Telling the truth is a losing strategy because, as we found in analysis of the change resistance subproblem, general ability to detect political deception is low. There's a sucker born every minute, or during election season, every second. The result is the race to the bottom is dominant most of the time.
So exactly WHY does the corporate life form want to exploit the race to the bottom in order to further his own special interests? What is the root cause of that behavior? To find out, here's a long extract from Common Property Rights: A Process Driven Approach to Solving the Complete Sustainability Problem:
What is the source of why The Race to the Bottom among Politicians is dominant? The answer is the root cause of social improper coupling.
Once we’ve got the right abstractions finding the root cause is easy. Looking at the Dueling Loops model, we see two loops locked in combat. The race to the bot-tom is promoted by corporate proxies. The race to the top is promoted by humanists, who seek to optimize the common good. The two loops represent how the world’s top two life forms, Corporatis profitis and Homo sapiens, are competing for political system control. This is obvious, as seen in the endless confrontations between public interest activists and corporate interest forces. This is especially obvious in environmental problems.
The Competitive Exclusion Principle says that when two life forms compete in the same niche, one will come to dominant the niche. The other will leave the niche, go extinct, or adapt to a different niche. In the control-of-the-biosphere niche, Corporatis profitis has clearly won. It’s dominant. The loser, Homo sapiens has adapted to a different niche where he plays the role of good consumer, good employee, and compliant voter. He’s happy in this role, because he’s under the illusion that he’s dominant and in control.
This comforting illusion is part of the mass deception machine run by corporate proxies. This would be a win-win except for one slight catch: the New Dominant Life Form is destroying the system both life forms live in.
Why are these two life forms destructively competing instead of constructively cooperating? Because of mutually exclusive goals. That explains everything. If their goals were fully aligned then cooperation on solving problems that benefit the common good would occur routinely. The battle of niche succession would end. The global environmental sustainability problem would be solved immediately because it’s such a high priority problem.
Therefore the main root cause of social improper coupling is mutually exclusive goals between Corporatis profitis and Homo sapiens.
This agrees with the previous chapter, which concluded that:
The goal of most for-profit corporations is to maximize the net present value of profits. The goal of most people, once past the survival and security stage, is to maximize quality of life for themselves and their descendents. These goals are mutually exclusive. As a result, as things get better for the New Dominant Life Form they get worse for the previously dominant life form: Homo sapiens.
Because Corporatis profitis is the dominant agent in the human system, the goal of that system is to maximize the net present value of profits. If you are a close reader this agrees with economics gospel, such as this extract from Understanding Capitalism, a leading typical introductory economics textbook: (p53)
In a capitalist economic system most goods and services are produced at the direction of employers… who seek to make profits by selling the produced goods and services in markets. Most people in capitalist economies work for someone else (their employers) and receive a wage or salary in return. So work is organized for the purpose of making a profit.
Because work is organized to make a profit, so is culture. So is everything. The whole system is organized to make a profit.
There you have it, in black and white from the experts: "Work is organized for the purpose of making a profit." Since nearly everyone works for a living, "The whole system is organized to make a profit." Until that changes, any problem that conflicts with the corporate goal of short term profit maximizations will be brushed aside by the system as a lower priority that doesn't matter all that much.
This is a tremendously useful insight because it explains so much. If the entire system is organized to make a profit, the entire system is going to resist changes that would reduce profits. So naturally the system will resist solving the sustainability problem and all sorts of common good problems like avoidable recessions, recurring wars, and excessive income equality.
Because large for-profit corporations are not pursing a goal that benefits the common good, they are a special interest. They seek special favors from governmental decisions. They only way for a special interest to get more than its fair share is to deceive the system into giving it more that others. This is accomplished by exploiting the inherent advantage of The Race to the Bottom among Politicians.
We've found the root cause. It's the cause of systemic change resistance. Until the root cause is resolved, the sustainability problem will persist, because the corporate life form shows no sign of weakening. On the contrary, it's getting stronger.
For example, ever since Deng Xiaoping declared that "To get rich is glorious" in 1989, for-profit enterprise has been growing exponentially in China. What happened as soon as the Soviet Union collapsed in 1991? Privatization by selling off state enterprises to corporate entrepreneurs began immediately, as Russia pivoted from a planned economy to a market economy. They didn't have a choice, because it was central economic planning that destroyed Russia's ability to manufacture goods and services as efficiently as the rest of the world. What's happening in India? It's GDP is soaring, thanks to its many emerging large for-profit corporations.
To summarize, as profits go up, sustainability goes down. As Corporatis profitis thrives, Homo sapiens slowly dies.
This substep is easy to perform since we have a model of the problem. We want The Race to the Top among Politicians to go dominant. But how are we going to do that? If the root cause is mutually exclusive goals between corporations and people, we need a feedback loop to change that imbalance. By extending the model, we arrive at the Alignment Growth loop. A simplified version is shown.
The goal alignment node is the difference between the goals of Corporatis profitis and Homo sapiens. As goal alignment rises, the human system works better and better. Let's follow the loop around to see how it works.
As the goal of Corporatis profitis is changed to agree with the goal of people, goal alignment rises. This increase the sense of artificial life form responsibility. Corporations really want to help their masters more, instead of merely pretending they do, as occurs in Corporate Social Responsibility campaigns. As the sense of responsibility rises, investment in raising ability to detect deception goes up. The most intelligent and powerful life form on the planet, large corporations, makes deliberate investments in solution elements like the Truth Test, Politician Ratings, and a Quality of Life Index. These quickly raise the people's general Ability to Detect Political Deception. That causes the percent rationalists to rise. Rationalists support the common good, while degenerates support the good of special interests. As percent rationalists rises that increases the quality of political decisions, and the loops starts all over again.
The Alignment Growth loop is similar to the loops society uses to improve various good things. There's a hidden Honesty Growth loop. The greater your sense of wanting to be honest, the more honest your are, the better you feel about yourself, and the better support you get from others because they can trust you. As that trust grows, so does your peer esteem, self esteem, and quality of life. As that grows, so does your sense of wanting to be honest and the loop starts over again. Human society has evolved thousands of such loops so that our species will self-organize into behavior that allows Homo sapiens to dominate his ecological niche.
What's the most efficient way to make the Alignment Growth loop go dominant? The answer is fairly obvious. We can’t change the goal of Homo sapiens to where it’s the same as that of Corporatis profitis, because that would only make the sustainability problem worse. Therefore we must change the goal of corporations.
But wait a minute. Is this the highest leverage point possible? Abstracting upward, wouldn’t it be even better to align the goal of all artificial life forms with that of Homo sapiens? Yes, because we need to consider robots, non-profit corporations, partnerships, governments, states, associations, and so on. We can’t foresee what all these will be, so we must include them all. This leads to the high leverage point: correctness of goals for artificial life forms. In other words, we must change the rules of the game so the game favors people rather than the other players as it does now.
Let’s test this conclusion. Imagine how easy solving the sustainability problem would suddenly be if the goals of the New Dominant Life Form were changed to align with those of humanity. The energy industry, transportation, the financial industry, agri-business and many more would no longer work against solving the problem. They would now work as hard as they could to solve it, because optimizing the common good of those people living and their descendents would now be their top goal. Given how well corporations have done in achieving their past goal, they would do just as well in achieving their new one.
To summarize, the high leverage point for resolving the root cause follows easily. If the root cause is corporations have the wrong goal, then the high leverage point is to reengineer the modern corporation to have the right goal. How that works is shown in the revised Alignment Growth loop.
Past low quality of political decisions caused low goal alignment. There are two high leverage points feeding into quality of political decisions. One, correctness of goals for artificial life forms, is the high leverage point (HLP) for this subproblem. The other, maturity of decision making process, is the HLP for subproblem C, How to avoid excessive solution model drift. Both HLPs must be pushed on to raise quality of political decisions high enough to bring goal alignment up to about 90%.
High process maturity means you have the right process for managing a problem. But unless that process has the right goal, it will produce the wrong results. That why a correct goal for the process is needed.
This completes the analysis for the life form proper coupling problem. If we can cause the Alignment Growth loop to grow strong, that 8 million pound gorilla will be transformed into the 8 million pound humble servant. He will be just as powerful. But he will no longer be just as dominant. That title will revert to Homo sapiens, as we watch in pleasant satisfaction while the Industrial Revolution gives way to the Sustainability Revolution.
Corporations drove the Industrial Revolution because only a supremely capable super-life form could do the job. If they did it once, they can do it again. That same super-life form, once we have a newly updated version with the right goal, will drive the Sustainability Revolution, which could also be called the Quality of Life Revolution.
Where will that revolution take us? No one knows. But we do know it will be a positive experience because The Race to the Top among Politicians will be dominant. In that mode politicians will be competing constructively to see who can optimize the common good the best.
If the past is any clue to the future, the world's now humble super-servant will astonish us all.
First warm up with this 29 page easy-to-read paper, one that was not written for academic journals but for you! The paper was written immediately after creation of the basic Dueling Loops model, so it has a fresh and vital quality.
For the complete analysis see this chapter on Analysis of the Life Form Proper Coupling and Model Drift Subproblems. PDF It's from the Common Property Rights book.