A gracious thanks to Mr. Hugh
Hamilton for arguing with me upon my delivery of this topic. His live radio
program, TalkBack! (where he takes calls from confused
people like me) must be a vital part of the education of anyone who listens on
a regular basis. It can be heard weekdays from 3pm-5pm, on WBAI 99.5 FM or at wbai.org.
The following does not necessarily reflect the views of Mr. Hamilton in any
way, however.
There is now a disconnect between our system for ensuring the
beneficial effects of public oversight via government and that government’s
ability to provide those benefits within the financial system that enables it.
An introductory note should begin by distinguishing between potentially
fuzzy understandings of decision-making. Decisions are made both by
individuals, and by groups, and they result from both conscious and unconscious
processes. The majesty of the democracy
as practiced in America, for example, is that it takes input from and feedbacks
with a large group of individual decision-makers, to create a collective
decision-making apparatus, that, by way of its feedbacking abilities, maintains
a balance between what the individuals want and what the group wants (the group
in this case would be the American voters). Over the years, the structure of decision-making for the
financial aspect of our government has become increasingly separated from the
same structure which drives the “upholding of public safety and public good”
part of the government. When not being held accountable for people, the market
is very good at what it does, which is to make sound, collective economic
decisions.
The travesty here, is that the economic part of this system works by a
different decision-making apparatus, one which seems to have adapted more
readily to a complexifying world, but one in which we, the people, are not part of that apparatus in any meaningful way
in regards to oversight benefiting our own public good.
The financing, or economic part of our government has been intercepted
by the private industry, that is, any for-profit industry which makes its
collective decisions from the aggregate of individual decision-making in the
market. This interception is visible both in the private industry’s ability to
manipulate the feedback system of government, via things like Citizens United,
and in the private industry’s ability to sidestep the laws used by the
government to ensure the benefits of their oversight. In these regards, the
private industry has shown that its form of decision-making is better at
playing the game than ours. It’s not about right or wrong, it’s about who’s
winning, and the private industry is winning right now.
It would be unfortunate if the private industry continued to take over
more and more of the decision-making that is not, but should be, done on our
behalf. So we have two choices: We either change the decision-making apparatus
in our government to act more like the market, or we change the myriad
decision-maker market to look more like a democratically-elected government (whatever
that may come to mean in the near future).
How do we begin to interface with private industry directly? Maybe the
government (as it now stands; we’re not talking anarchy here) should no longer
be our mediator. It shows itself more every day to be failing at its task in
this. That private industry manipulates voters and sidesteps the law supports
this notion. We the people have yet to find our voice in this system.
How do we get the private industry to do well what our governments used
to be so good at?
How do we rewrite the laws of our new government so that we can take
back our roles as decision-makers?
note:
I like Richard Wolff’s “Democracy at Work” idea, and I like Iceland’s
Crowdsourced Constitution idea.
epilogue:
If your only objective was to get as much money as possible, and you
could totally ignore the needs of the people, wouldn’t you do the same thing as
the banks? Theirs is not to think about the public good, only money. No concern
for people, not now, not ever. Banks aren’t people, but they are controlled by
people – individuals making decisions that filter up to other hierarchically
arranged groups of people and so on until you reach the designated collective.
The purpose of all the individual decision-makers involved is to make the right
decisions in the hopes that you can keep the thing going. Greed is just another
word for momentum.
The financial system, the private industry, Capitalism, are all really
good at looking out for themselves. They aren’t stupid, though they aren’t
conscious either. People tell these things what to do. We should be those
people.
update:
I guess it should be noted that the market actually now makes decisions
based on algorithms, the workings of which we, at times, don’t even understand.
This puts the decision-making of the private industry even further away from
the one used within our governments.
NYSE looks into 'irregular
trading' in 140 stocks
1 August 2012
“Reports in US media suggested that a trading algorithm used by the
brokerage Knight Capital may have been behind the stock moves.”
http://www.bbc.co.uk/news/business-19087748
Raging Bulls: How Wall Street Got Addicted to
Light-Speed Trading
BY JERRY ADLER 08.03.12
“For the first time in financial history, machines can execute trades
far faster than humans can intervene,” said Andrew Haldane, a regulatory
official with the Bank of England, at another recent conference. “That gap is
set to widen.”
Kevin Slavin: How algorithms
shape our world
FILMED JUL 2011 • POSTED JUL 2011 • TEDGlobal 2011
Kevin Slavin argues that we're living in a world designed for -- and
increasingly controlled by -- algorithms. In this riveting talk from TEDGlobal,
he shows how these complex computer programs determine: espionage tactics,
stock prices, movie scripts, and architecture. And he warns that we are writing
code we can't understand, with implications we can't control.
