Common Good Dialogue - Alan Page's blog

A Thought Experiment for Mother's Day

The Common Good is a confusing area to discuss in a period of rampant fraud and financial and technical misinformation.

There have been a number of astounding disclosures over the past decade (a trend that  escalated over the past few months) that have revealed a hither to unbelievable level of greed and incompetence by people who were hired to handle assets for clients for a fee, and media using corrupt practices to enhance corporate dominance in international markets.

Even mentioning appropriate practice for a region in the face of allegations of such gravity is an exercise in frustration. Most of humanity has been effectively brain washed to understand that food can be more effectively bought than worked for, that while biodiversity may be important the price of needed physical goods that one must have now is of paramount concern, and that powerful people can make good decisions for people they represent. The common good is nowhere to be found in these common every day situations, since personal convenience and status have been elevated to become the basis for immediate decisions.

 

If there is a chance that there are tipping points in the climate maintenance system, or a formula that is used to form investment decisions that is fraudulent, or an information source that is based on lies, one would assume that it would be possible to have an intelligent discussion about such threatening possibilities. That is not the case because we have lost the capacity to think beyond the next trip to the store.

 

Some suggestions for home work:

 

Work through the effects of exponential growth several different ways.

1. The Doubling Experiment: You will need a checker board, twenty plastic bags, a note pad and pencil, and a quart bottle of rice. The experiment involves doubling the number of rice grains on each succeeding square of the checker board. Make a guess about how many squares you will get to before you run out of rice. Use a checker board as a guide for how many doublings you are able to advance through with the grains of rice in the quart bottle. The object is to see how far you actually get when doubling the amount of rice on each successive square. The note pad is there for record keeping and calculating each successive doubling and the bags are to hold the relevant amounts of rice where the square is too small to hold the rice allocated to that square.

2. The Graphing Experiment: The common investment return formula is: FV= PV x (1+i)ⁿ, where “FV” is future value, “PV” is present value, “i” is any interest rate expressed as decimal number, and “n” is the number of years.

   Using a piece of graph paper draw a vertical line near the left side of the paper and label it FV, draw a horizontal line at the bottom of the vertical line over to the right side of the paper and label it time (n). The calculate ten different values of FV changing only the value of n, and place a dot on the paper where the horizontal projection of FV intersects the vertical projection of “n” for each calculation.  If your interest is piqued do this for different values of "i" .  Make sure that you use large enough values of "n" to cause "FV" greatly exceed "PV".

The question one must wrestle with is “where does normal growth stop and mining and greed take over the process of resource allocation?”  We will look at this question from various resource perspectives in future sessions.

This is what all national economies are wrestling with when they borrow money from entities that are outside their population and are out of reach for recovery of excess funds through taxation. 

Consider:  What happens to a local economy when an entity can accumulate funds beyond an amount that is appropriate for a normal person to acquire consistently over time?

The Breakdown of Proactive Forest Care in MA

To Whom It May Concern:
The regulatory framework for control of local renewable resource production has become so confiscatory that it has the potential to shut down all but the most lucrative kinds of land treatments.  This situation has been repeatedly raised by the staff of Green Diamond Systems in many venues with little effect other than the admonishment of local representatives of DCR to act to facilitate a dysfunctional system.

The failure of MA DCR and DEP to proactively address these issues will drive any interested landowner into off the record activity.  This kind of situation puts professional advisers in an intolerable position.  DCR and its predecessor DEM have failed to enforce their positional mandate of  facilitating a vibrant forest industry in MA.  The current situation verges on an illegal act.  The responsible Executive office, EOEEA, has been staffed with political appointees with no knowledge and or an agenda that is antithetical to the mandates of DCR, but has left in place the verbiage of past understandings.

As of this date I am informing landowners with land in need of low value treatment to proceed without official sanction and that this is an act of civil disobedience that is needed to force much needed change. 

This notice should serve as a challenge to the official structure of the State of MA of the need to either enable licensed foresters to make judgment calls on the need for repeated filing of notices of activity on low value tracts or to remove the licenses of those foresters who try to cause proactive measures to be undertaken!


Alan C. Page, PhD, Research Forester
Green Diamond Systems
125 Blue Meadow Road
Belchertown, MA 01007
EMAIL: alan@greendiamondsystems.com
TEL- OFFICE: (413)323-4401
TEL-CELL:(413) 883-9642

 NOTE:

It is interesting to review the documentation that allows the formation of local conservation commissions because the first sentence deals with maintenance of a healthy local ecosystem not with their main power source water resource issues.  The latter has come to dominate the concern of conservation commissions even as they fail to perceive  the potential and now imminent impacts of allowing their communities to become oil dependent ghettos (bedroom communities) with no visible means of support other than the tenuous corporate for profit supply line.  The removal of local resource constraints has allowed areas like MA to encourage populations that are completely unsupportable in the absence of oil for transport and agriculture and  coal for electric generation.  This will not end well.

The fires in MA Tornado Damaged forest has begun:

http://www.masslive.com/news/index.ssf/2012/04/brush_fire_burns_up_to_50_torn.html

Vital Information

This is an interesting time to combine the issues of getting older with those of being responsible to others.  The boomers seem to be wrapped up in growth for retirement sake.  Younger job seekers want growth to generate jobs.  Government officials seem to want growth to fill pockets that they should fill in other ways. Then there are the speculators who seek money growth regardless of who it hurts.

Recent revelations in the financial community, Lord James of Blackheath - $15 trillion dollar transfer through the Royal Bank Of Scotland, JP Morgan's recent denial of service to the Vatican, the loss of sponsors by misinformers and many others are the basis for thorough going change in the systems of finance, governance, enterprise and communication.

The issues to watch as these changes unfold involve not only those of personal liberty and financial stability, but how those who will try to govern will find the wherewithal to maintain life support without the old coercive systems.

So not only are the "Simple Messages",  of the recent past posted here, more germane than ever, but so are the possibilities of inclusion of all life within the umbrella of an essential infrastructure. Today we must find ways to be proactive in support of things that were trashed for profit in the past. 

The Climatologists conference discussed in "Climate Progress" by Joe Romm on Saturday issued a statement describing the likelihood of an imminent unpredictable explosive release of CO2 and methane from rapidly decomposing subsea organic matter and melting permafrost - labelled a "Compost Bomb".  How do you propose we think about this?  What is the common perspective here?  Who knows enough to make the judgements about what is too much?

 

A Call to Arms for the COMMON GOOD

At a time of unbridled greed we have recently witnessed several acts of uncommon courage.  The revealations of the "toxic" environment at Goldman Sachs, Wells Fargo and (yes) your local farm and doctor's office are warnings of the need for a new mindset.  These courageous acts by insiders of the financial industry and the WHO are guides for a new assault on business as usual.  We have two choices that will require the same kind of sacarifice as conflicts of the past.

On the one hand we can continue business as usual and live high on the hog for a short time.

Or we can aschue greed everywhere and retain some of the ease that has come to characterize the recent past with the possibility of maintaining life as we know it for the long term. 

It is a pivotal decision that all must make and live with less NOW.  Our choices in the past have changed everything and the misinformation offered by those driven by greed must be countered with understanding and care.

The warnings from within the upper echelon of the global financial community clearly show the impact that greed in the hands of resourceful individuals can have.   This single factor has the ability to distort the basis for all facets of human life.  The WHO warning calls on everyone to use antibiotics sanely or lose completely the ability to treat most common illnesses within our lifetime.

These warnings are not new but do add urgency to understand the nature of life by everyone and choices we all face - use our COMMON GOOD carefully or lose much of it in short order.

THE CALL to ARMS then is for us all to extend acts of uncommon kindness when greed would dictate a much different path and to act with necessary and deliberate force in situations where greed rules.   The new normal must resolve the conundrums we all face over time.  When faced with a situation "follow the money" and choose the alternate if possible.  Daily choices of meat versus bread must now favor "bread".  When a big solution can be replaced by a smaller more local one choose the later.  When you do not know the person offering a solution choose a venue where you can find out much more before making your decision.  When there are short term and long term alternatives look carefully at the long term choice before opting for the cheaper short term decision.  Medical decisions may seem to be especially difficult, but uncommon kindness now may involve choosing not to have invasive repairs or life extending treatements especially in those of advanced age where the recent model is for money to be thrown at a problem that used to cost little other than letting nature take its course.

 

 

 

A Comment on Public Funding

The Common Good of any region is the province of government.  Currency creation is one of the sacred trusts of government that have been regularly mishandled by those with the power to do so.  This short message was not allowec on a NY NPR site as of March 1, 2012.

 

The “Empire” State is alive and well. NY needs a public bank that is a wholly owned entity of the State dba the "Bank of NY" just as the State of ND has had for the past 90+ years. The interest that NY spends on bond issues should be paid to itself just as surely as the Greecian debt should be paid to a Greek Central Bank rather than private investors.  It is helpful that the US Federal Reserve repatriates 90%+/- of the interest income it receives to the US Treasury.  It is not helpful that there is a private bond trading entity between the US Treasury and the FED that decides who can buy Treasury debt.  The private bond h0olders of US Treasury notes, NY infrastructure bonds or short term fund borrowing, and the debt of the PIIGS countries do not repatriate any of their interest payments.  Rather they take the interest money paid to them out the country as if NY or Greece or Iceland or Ireland were a mine to be exhausted and closed down!

    It is time to call the investor’s bluff and tell them that the money growth game is over. The idea that money should grow only for those who have it is the root of the problems we all face. If Governor Cuomo wants to be part of the empire clique then he needs to be identified as such and be replaced, just as the political establishment in MA and Washington, DC does. It is time that we tell these guys that we are going to make them behave just as Lyndon Johnson told the activists of his time that they had to do for him. We get what we deserve and right now we do not deserve much.

Simple Messages Revisited:

SIMPLE MESSAGES:

The simplicity of the following statements may hide the difficulties we face in connecting these truths to the form and function of our governmental structures and the entities that flow from these support systems (our economy and society). Our agreement (if any) with the substance of any particular message will not be enough to cause that fact to become a reality. Our failure to stand up for a functional system based on well understood principles will continue the dysfunction we now enjoy!

1. Sovereign entities (governments) exist (in democracies) because the people want them to be there. These democratic governments are created and continue by the contribution of a portion of the personal sovereignty of each citizen in a region.

2. Governments do things that no one else can or even should.

3. A basic duty of a democratic government is to maintain the common good. The current system trashes these common assets by encouraging externalization of as many costs as possible and allowing misinformation based campaigns that lead everyone to believe that “cheap everything” is beneficial.

4. Coinage of currency and creation of credit are basic sovereign (governmental) responsibilities that have been transferred to entities that do not have the standing to act as (or for) any sovereign and should not act as such except in highly regulated "utility" modes.

5. Compounding growth (interest being earned on principle and interest) must be severely limited as a our common expectation for any part of human activity.

6. There should be two kinds of currency created - long term system maintenance funds (infrastructure) and short term (our normal economy) funds.

7. Infrastructure functions are the basis for our common good (life support). We are not generally conversant with the range of these long term aspects of all facets of “life as we know it” and we all must begin the conversation to build / rebuild this understanding.

8. Currency games - most investing - should be seen as addictive and unsustainable activity and be relegated to a pass-time for enjoyment. Gains from such games must be taxed as they accrue.

9. True investing should be limited to equity ownership in productive entities that are held for the benefit of the entity and society.

10. One's prowess at a game should not bestow any special status outside the clique of game payers. The best games are those where all players win - rigged games are unfair and should be illegal.

11. Credit creation today is a rigged game because the debt basis of all credit (using compound interest) guarantees that all value ends up being owned by the lender.

12. Life is the source of all value - without life there will be no value as we know it.

13. Life depends on many "common goods" - therefore these commons are the basis of all value and must be protected to maintain life - all life as we know it, not just human life.

14. Being "pro-life" is not simple - or simply about human life. Being alive is a special "gift" - not a birth right. Since life is precious and interconnected, the gift of life requires each one to make the best choices they can. Humans have a very special obligation because we now have the ability to enhance or destroy the normal life processes of areas and the whole planet (our space ship). Those who deny this obligation can not also claim to be “pro-life”.

15. The ability for a human to make good choices is a skill that must be developed by each individual in each locality - facilitated by the sovereign since the sovereign is the entity delegated by the living to do things that are difficult or impossible for each to do alone. Thus education of the human population is a sovereign duty that must be available continuously to all humans. Those seeking education must provide guarantees of competence to undertake an area of study but should not have to bear the cost of maintaining the educational structure.

16. It goes without saying that a healthy, capable and well equipped population will be cheaper to maintain than one that requires either extended outside care or incarceration. However, the word "cheap" has little relevance here since we are dealing in responsibilities rather than economics - so the operable word might better be "easier".

17. Energy use has made human life easier. Energy use entails many activities that have wide ranging consequences. Taken as a whole the actions to acquire concentrated energy sources should not adversely affect the life processes over time since no one person or group has any more right to the life giving capacities of any particular resource base than any other. The high energy culture of humanity is patently unsustainable for humans and deadly for other life forms.

18. A sustainable life basis will use no more of any resource than can be recreated over time for those who come after those now living. The economics of the short term must have no higher priority than does the economics of the longer term. The gifts of the resource base and the gifts of ingenuity to use it are all facets of the same thing. Those thinking of partaking of a particular gift would be well advised to remember a simple rule: "Of a little take a little, manners so to do; of a little leave a little, that is manners too." Those who violate that rule have a heavy burden of justification since they are not privy to the giver and must justify that in the long run their actions will more than make up for their short term consumption.

19. The common good, INFRASTRUCTURE, is that which exists or can be devised which does or will enhance the maintenance of life. Infrastructure investment and maintenance is the special responsibility of the sovereign. Since the government (which really owns everything) has a much longer time horizon than any individual citizen or community, it is appropriate even essential for such sovereign entities to put in place those factors, situations, capabilities ... that will function over time to enable all to be as sustainable as possible.

20. Infrastructure (most long term activities) normally have no cash flow, but may have some eventual value that the owner of the facet of the long term economy may recover periodically.

21. Sovereign entities (the broadest governing entity of a democratic society) are never insolvent unless they either want to be or are put in a position of owing some other entity something that they can not produce. There are many reasons why such entities would like to appear insolvent.

22. Taxes are a tool for inflation control. The current taxation system is a system for domination rather than effective economy regulation.

23. Inflation comes from gambling with excess discretionary income. These pools of excess credit are the points where taxation must be applied.

24. Infrastructure funding is the basis for all other activity and should be available in all localities from the highest level of government as a normal function on a permanent basis. In a sustainable setting "things" are always growing and decaying. Something that is meant to be permanent will require special treatment on a regular basis since permanence is not normal in nature.

25. Those closest to a situation are likely to be the most knowledgeable about what will work and will certainly have to bear the consequences of any action over time more than any outsider. Thus equipping local residents with the information and enabling with the funding and resources needed to be sustainable or to devise ways to become sustainable is likely to have better results than providing outside expert advice that does not have to bear the outcomes of their advice; see John Perkins work. We are all in this together!

 

Life by Misinformation

The MA forest covered landscape occupies a predominant portion of the area of the state.  What once was 70% cleared for grazing and other agriculture is now nearly completely over grown and the state is now almost 70% forest.  The "normal" corporate dependent citizen has come to expect that the forest is just there for them to look at as they buzz by in their fossil powered tank. 

In reality the forest is a tremendously important and fragile part of the life support system of this troubled outer layer of the "eaarth"'s shell.  As the climate changes untouched forest is completely vulnerable extreme weather events.  These extreme situations are coming to dominate the annual climate scape.

Our ability to choose appropriate paths for the use of the production and management of the potential of the rural forest scape comes from understanding the realities of the various alternatives.  When the information base is not clearly communicated, the base for decision msking is distorted.  We are living in a time of intentional distortion of all information.

One recent source of misinformation that came from the Patrick Administration came in the form of a publicly funded environmental report - the Manomet Report.  A recent commentary on that paper can be found at:

http://www.futuremetrics.net/papers/CO2%20from%20Wood%20and%20Coal%20Combustion.pdf

Here is a slightly different view of this reality:

While this paper completely vindicates the position of wood being a sustainable fuel with lower than coal carbon dioxide emissions, it hides the "cherry picking" of data that the Manomet report used to arrive at its extremely biased conclusions.  Both reports focus on the burning of normal green chips.  This report only reports the sane use of the 70% waste heat to predry the chips at the very end of the report.

However, the real issue that none are addressing is the fact that the corporate solution of concentrating production facilities in remote locations or poor neighborhoods is driven by the inappropriate nature of our financial system.  Power production is an infrastructure item - a basic life support function - and should be financed in a completely different manner from "normal" short term funding of every day practices.  The limiting size of these systems is based on how fast or at what level an outside investor will get paid out.  These functions that maintain the quality of all life in an area should be funded from the asset base of the area and the proceeds if any from the use of the facility should go back into the funding base of the locality.  This disconnection of locality and fund sources is the basis of the EU problem and will devastate any area that depends on it.

So we need to counter both of these reports with a variety of analyses of different kinds of systems for generating both electricity and local heating and cooling.  We need to pay particular attention to local food processing and storage so that when the fuel costs limit the availability of outside food we can still function on our locally produced resources.  The corporate dependence, model moves production into distant facilities and uses cheap fuel to move it around and then causes everyone to believe that this is normal.  As production of most goods is outsourced, the production of energy in centralized facilities necessitates the disposal of nearly 70% of the input energy as waste heat.

We should see through this smoke screen to the base of facts and explain them to our children so that we break this cycle of brainwashing.  Unfortunately, we are now regulated by a group that has been co-opted by the financial "industry" (as if they ever produced anything) and they now dictate the possibilities to the most sustainable part of our local resource base.  This must change.

Alan C. Page, PhD, Research Forester

Thinking of the Common Good? - think rural and natural growth

Regardless of what the new MBAs in Sustainability tell you when sustainability really matters the forest or farm is where it all starts and can continue for as long as the climate and the treatment given by humans allows the biology in those places to florish.

The current focus on "growth" is patently unsustainable.  Because everything living grows it is essential that there be a solid understanding of the difference between growth in a sustainable sense and growth in the current political and economic sense.

A forest is a good place to start thinking about sustainable growth because every tree in a forest is either dead or growing.  The bigger a tree is the slower it is growing normally. 

Trees grow in many ways but there are only two mechanisms that provide measureable growth responses: getting taller or getting larger in diameter at any point on the living part of the tree.  Other kinds of growth are derived from these two kinds of additions to the tree or from chemical changes to some part that has already been produced. 

In any case it is safe to say that fast growing trees will either slow down in growth soon or they will be given more room by either a human or natural thinning.

 The process of growing a tree:

Trees can start from several sources of life, seeds, sprouts, cuttings, etc.  Each source is very small and growth starts slowly and builds first with a shoot from the ground and then with both addition of girth to the existing stem and additional shoot development on top of the previous shoot.  This process repeats itself until the tree dies.  Along the way various parts of the tree can be lost either by death of a part or by physical removal.

Calculation of the rate of growth:

The process described above fits the classical notion of compounding of an amount over time.  So one can calculate the rate of height growth as a percentage of the existing height, or the rate of diameter growth as a percentage of the existing diameter at any point, or dollar value as a percentage of the existing value...  The traditional formula is Fv=Pv * (1+i) to the nth power, where Fv is the future value, Pv is the present value, i is the % growth rate, and n is the number of years over which the calculation is performed.

Essential Differences - Normal Credit and Infrastructure

Today all currency (except coins) and credit are created through debt.  Numerical balances of currency and credit are calculated and used as if they were the same thing.  These numeric statements are now a description of status, personal prowess, value to society, etc.  As described in the last post (Currency Creation) this numerical status symbol is not natural and will be very damaging to our common ability to survive in the form that life has taken up to now on Earth. 

There are two different entities that coin money and extend credit.  The Congress has the exclusive duty of coining money and does so at the Mint by placing an official stamp on a piece of metal.  These coins are issued as legal tender.  The Treasury Department has the ability to issue bonds that bear interest that are used to borrow funds from various entities to finance governmental functions that are not covered by current receipts.  Prior to 1935 the only buyer for Treasury bonds was the Federal Reserve.  In 1935 a private bond trading entity was established to allow the sale of these bonds to a variety of buyers.  (More on that at another time.)  The Federal Reserve and its member chartered banks also create credit on demand subject to some rules that determine who has the right to extend how much credit and to whom.  The issue is that all this credit is formed through debt instruments and is subject to the surreal interest phenomenon.

Currently the coins minted by Congress are a minor fraction of one percent of the credit now created.  Thus all of the normal economy must function with this debt created currency.  If the debt is outstanding for very long the compounding effects cause there to be much less currency than will be needed to pay both the interest and the principal.  So it is no wonder that there are periods of economic disaster.  What is missing in this scenario is a stable source of reliable maintenance funding for those areas that provide the basis for the continuance of life as we know it.

More will be added in the discussions of INFRASTRUCTURE to follow.

 

 

Currency Creation - Opportunities and Pitfalls

The short term economy controls everything when you have limited discretionary income.  This is accomplished by requiring that any recipient of credit be able and committed to an immediate and regular schedule of repayment plus interest.  Interest is calculated not based on a schedule of costs incurred by the lender, those are the fees that one must pay for the priviledge of borrowing, rather a percentage of the outstanding debt is added on to the debt for each period with the result that the amount borrowed actually grows until it is paid off.  This happens normally when living things grow, but the idea that money can grow has incidious side effects. These effects include the transfer of all assets of the borrower (and all the rest of society) to the lender if the growth period is allowed to extend long enough.  This is the source of our global income disparity and is patently unsustainable, unfair, inappropriate and impossible to maintain.  So it is essential that all debts be paid off quickly and that debt not be a substantial component of daily life.  Today most currency is now credit and is created through debt vehicles and is extinguished when the debt is paid off.

You experience this when you make large purchases or use a credit card.  We have come to expect that we owe to someone, with the ability to create credit or lend money, both the borrowed funds and a bonus that few understand but for some reason all respect.   Contrast this with the experience of borrowing a hammer from your neighbor.  When you are done with the hammer it gets returned with a thankyou or if it broke it is replaced but nothing else is transferred with it.

The past hundred years have seen the boldness of those in a position to extend credit reach new heights, but this is not new.  Today the problem has morphed into the same situation faced by Germany between the two wars.  Our banks and investors no longer function to invest directly in socially redeeming activity.  Rather they are addicted to casino style gambling even to the point of setting up investments for others that they know will fail and then make money by betting against the investment they sold.

Growth is a common term used to describe the process of keeping the economy healthy, but many have shown that growth can only be a temporary fix.  In the long run unless the planet becomes much bigger and the land area exposed becomes greater our spaceship is finite.  

Forests are interesting because they have solved this problem of all living elements growing and yet being constrained to limited resources.  If you live in a forested region you can see what it looks like by taking a walk.  But unless the conditions are unusual you will not see much going on.  Looking closely one will see most of the trees are living, some are in better condition than others and a portion of the standing individuals are dead or about to die.  The ground is littered with tree parts that have been discarded by the living and whole stems of those that have been dead for some time.  It is easy to mistake the situation for one that is idyllic and peaceful.  However, the limitation of resources is always front and center and those trees that miss an opportunity will stop growing and may eventually fade away ("evaporate" back to CO2 and water).  There is no life after death for the individual tree that dies but the community builds new life on the resources of the past occupants.  Those trees that command the space they occupy grow faster for a while, but when their needs exceed the capacity of the area they occupy they stop growing.  There are many different kinds of resources that can become limiting over time.  This kind of problem is not solved by extraordinary actions in the natural world, it is part of life and life goes on for the community until or unless the conditions needed for new life are extinguished.

Animals have the same limitations except that their mobility increases the reach of the individual and in the worst case allows out migration. In the past humans did the same thing as individuals although each may have attempted to forestall the day of reckoning as long as possible. 

The area of money as a source of value has taken on a different surreal quality.  Money is expected to grow reliably.  When we speak of debt, this is just a return that someone else is expecting to get come hell or high water when they have lent an existing asset, or it can be a numerical transaction that is part of the process of creating the currency and credit needed to run a society.  These two processes are used interchangeably  but have very different implications.  The banking establishment has acquired the ability to make both kinds of loans happen with the same expectation - that they will be paid back in full for both the principal presented and the interest accrued.  

The better one's credit rating the less likely one is expected to default on an obligation.

If you have lent money to someone you probably like it the way it is.

We will study the implications of this over the next few weeks.  There are some interesting essentials that most miss.