Thursday, June 10, 2010

The Empathic Civilization and Why We Need Explorers

This piece revolves around the combination of two very interesting videos; Jeremy Rifkin’s - The Empathic Civilization, and Brian Cox's - Why We Need Explorers.

Hey, who else would (or could) combine these and make them fit into their foundation of economies theory?

As you may recall, I’ve had Rifkin video on before: Jeremy Rifkin: More Empathy in the Global Economy?

As you view this presentation on Empathy, you may have alarm bells ringing in the back of your mind… is he selling us the central banker’s “one world?” No, I don’t think so… please view the clip and then let’s discuss:

Sure, if I were a central banking debt pusher wanting to control and profit from the world with my debt, I’d want a nice sounding story like Rifkin is painting. But remove the central banker debt pushing fear that we’ve all grown to despise, and perhaps he is describing the way the world really works? And while it sounds like he’s talking about psychological principles, I think he’s touching upon a very fundamental building block of any economy. We’re talking about the building blocks that come before the rule of law.

Remember how I wrote about The Foundation of Economics? In that article I showed how economic activity begins with the rule of law at the foundation and builds up into wealth and prosperity.

Well now we need to add Empathy and Communications at the base which supports and leads to the creation of the rule of law. And as a review, no, natural and human resources are not at the base of the economic pyramid! Proof? Take a look at Hong Kong or Singapore, both poor in natural resources. Or look at the wealth of the Dominican Republic versus the abject poverty of Haiti – both with similar natural and human resources, so what is the difference?

Well, now it’s time to go a little deeper. First of all we need to agree that any economy must fit and work within nature. If, for example, the math of debt backed money doesn’t work, then it doesn’t work within nature and therefore it won’t last. The rule of law can be anything we want it to be, but if it fails to fit into the physical world, then it will fail. So envision that the economic pyramid is surrounded by, and works with nature (hint – never ending growth will eventually fail).

Thus the rule of law is EVOLVING over time to better fit the rules of nature. Obviously it has a long way to go and I have a lot more to discuss on this but will save it for now. Suffice it to say that as political systems and economies rise and fall, that the structure of these systems has been leading us slowly in a certain direction… Are wealth and prosperity really the top of the economic pyramid? Is there no higher PURPOSE?

I say that ultimately the “invisible hand” is not just Adam’s Smith’s self-interest. Rather, it is our natural instinct to survive. Thus the invisible hand is caught between a person’s own self-interest and mankind’s larger self-interest. Is having a child, for example, in one’s own self-interest, or do we have an innate drive to perpetuate the species into the future? The natural mission thus becomes the survival of the species, and that is what truly belongs at the top of the economic pyramid. Again, I have much more I can say about that, but let’s go back down to the foundation of the pyramid where we find Jeremy Rifkin.

How are empathy and economics related? Well, if I have some capital or labor I can accomplish a little. If you and I decide to partner our capital and labor we have a little more, and can accomplish some things that I, as an individual, could not accomplish alone… and on up the chain into corporations and into governments we go. But we can’t work together if we don’t have two key ingredients – empathy and communications! Rifkin gives some great examples of how empathy and communications have come together throughout history to advance civilization.

Empathy and communications are at the heart of capital formation! Could we have placed man on the moon without them? Is placing man on the moon beneficial for our economy or for the survival of our species? How much capital formation and concentration is required to accomplish that feat? Certainly no one individual can do it alone. In fact, no one corporation can do it alone and thus in practice it required the combination of government and corporations. Does it advance our economy towards the top of the pyramid? Yes, I think it does – sans debt backed money it would do so much more efficiently (caveats galore – see Freedom’s Vision)!

Had an urge to climb a mountain lately? Jump on your bike and just travel? Why do people explore and work to extend their range? Could it be a part of the survival instinct? What does nature say about species that fail to evolve or to expand their territory? Now, don’t get me wrong, expanding territory to the exclusion of nature is suicidal - that’s what we have to overcome with our intellect. The battle between our instincts and our intellect will determine how far into the future our species goes.

Would we have explored "the new world" without this drive to explore? Did that require capital formation and a new rule of law (corporate limited liability) to pull it off? Yes it did. Would the framework of our Constitution been invented had we not? Would you be alive today and living in America?

No, we don’t spend nearly enough on the sciences. And the “science” of economics is probably dead last… yet it’s the very thing that must be understood if we are to progress. It’s a cycle that works WITH nature and feeds up the pyramid. Not the debt money narcissistic pyramid, but the economic foundation pyramid. Yes, we are going to have setbacks. We’re facing a large one in the near term, but don’t give up or give in. It’s the struggle that gives us the empathy that will allow us to take the next giant step forward for mankind.