Author Archives: Editor of the Fabius Maximus website

About Editor of the Fabius Maximus website

Larry Kummer. See the authors page for more information about me, my co-authors,and the Fabius Maximus website.

Tom Engelhardt: the key to winning wars in the 21st Century

Summary: The greatest US tragedy since 9/11 is our failure to learn from our failed wars, making it impossible to win future wars. We roll on from one disaster to another even larger disaster. Our wars are the seldom-mentioned elephant stalking our candidates on the campaign trail (other than GOP chants to bomb bomb, bomb). Here Tom Engelhardt, who has chronicled our misadventures since right after 9-11, gives a masterly summary of the steps that brought us here. It’s the first step to learning, more valuable than the hours of sound-bites from any of the debates.

Learn from mistakes

 

Shoulda, Woulda, Coulda

The U.S. Military Bombs in the 21st C
By Tom Engelhardt at TomDispatch
Reposted with his generous permission

 

Here’s my twenty-first-century rule of thumb about this country: if you have to say it over and over, it probably ain’t so. Which is why I’d think twice every time we’re told how “exceptional” “or indispensable” the United States is. For someone like me who can still remember a moment when Americans assumed that was so, but no sitting president, presidential candidate, or politician felt you had to say the obvious, such lines reverberate with defensiveness. They seem to incorporate other voices you can almost hear whispering that we’re ever less exceptional, more dispensable, no longer (to quote the greatest of them all by his own estimate) “the greatest.”

In this vein, consider a commonplace line running around Washington (as it has for years): the U.S. military is “the finest fighting force in the history of the world.” Uh, folks, if that’s so, then why the hell can’t it win a damn thing 14-plus years later?

If you don’t mind a little what-if history lesson, it’s just possible that events might have turned out differently and, instead of repeating that “finest fighting force” stuff endlessly, our leaders might actually believe it. After all, in the wake of the 9/11 attacks, it took the Bush administration only a month to let the CIA, special forces advisers, and the U.S. Air Force loose against the Taliban and Osama bin Laden’s supporters in Afghanistan. The results were crushing. The first moments of what that administration would grandiloquently (and ominously) bill as a “global war on terror” were, destructively speaking, glorious.

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DoD’s next challenge: managing the fall of our military welfare state

Summary: The military is often described as a test tube for American social science, running experiments such as integration of race, sex, and gender in its relatively controlled society. But the largest social science experiment in the military — perhaps the largest in US history — is DoD’s socialism. We close our eyes, preferring not to see it. Now the military’s spending priorities are changing, and we’ll see the effects on recruitment and retention as it is eroded away. Here Jennifer Mittelstadt explains the history and workings of the military “welfare state”.

 

Military socialism under siege

Under pressure from the increasingly outlandish cost of hardware (e.g., carriers, the F-35), DoD has chosen to cut compensation of its people. It is one of the most important and least covered defense issues (a minor sideshow, keeping the A-10 Warthog, has received 100x the attention).

One of the best articles I’ve seen in years about this is “Welfare’s last stand” by Jennifer Mittelstadt (Assoc Prof of History at Rutgers) at Aeon, 21 September 2015 — “Long in retreat in the US, the welfare state found a haven in an unlikely place – the military, where it thrived for decades.”

Her essay does not respond the usual rebuttal to these facts: this social safety net is compensation for risk borne by our troops. In fact it covers everybody in our uniformed services, during peace and war. It is not limited to those in war zones. It is not limited to those experiencing non-combat risks greater than those of most civilian jobs (and the even smaller number exposed to risks greater than those of the most dangerous civilian job (logging and fishing).

I assume Mittelstadt called it “military welfare” for the shock value. In fact welfare is much more selective in its benefits than the “safety net” inside the military — so “military socialism” fits better.

For more see her book The Rise of the Military Welfare State (2015) — which I ordered today.

Opening of “Welfare’s last stand”

Over the past four decades in the United States, as the country has slashed its welfare state and employers gutted traditional job benefits, growing numbers of people, especially from the working class, grasped for a new safety net – the military. Everyone recognises that the US armed forces have become a global colossus. But few know that, along with bases and bombs, the US military constructed its own massive welfare state. In the waning decades of the 20th century, with US prosperity in decline, more than 10 million active‑duty personnel and their tens of millions of family members turned to the military for economic and social security.

The military welfare state is hidden in plain sight, its welfare function camouflaged by its war-making auspices. Only the richest Americans could hope to access a more systematic welfare network. Military social welfare features a web of near-universal coverage for soldiers and their families – housing, healthcare, childcare, family counselling, legal assistance, education benefits, and more.

The programmes constitute a multi-billion-dollar-per-year safety net, at times accounting for nearly 50% of the Department of Defense budget (DoD). Their real costs spread over several divisions of the defence budget creating a system so vast that the DoD acknowledged it could not accurately reckon its total expense.

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David Stockman explains “Why The Bulls Will Get Slaughtered”

Summary: Americans are so often ignorant because we learn from clickbait, as seen in this exciting but misleading article by David Stockman about yesterday’s jobs. When we decide to get information from boring but reliable sources we will have taken a big step to again governing America.  {2nd of  2 posts today.}

clickbait

 

Clickbait rule #4: when you have nothing to say about new economic numbers, attack the seasonal adjustments.

 

From David Stockman today (bold in the original): “Why The Bulls Will Get Slaughtered“. Reposted, of course, at Zero Hedge. Opening…

Needless to say, none of that stink was detected by Steve Liesman and his band of Jobs Friday half-wits who bloviate on bubblevision after each release. This time the BLS report actually showed the US economy lost 2.989 million jobs between December and January. Yet Moody’s Keynesian pitchman, Mark Zandi described it as “perfect”

Yes, the BLS always uses a big seasonal adjustment (SA) in January — so that’s how they got the positive headline number. But the point is that the seasonal adjustment factor for the month is so huge that the resulting month-over-month delta is inherently just plain noise.

To wit, the seasonal adjustment factor for the month was 2.165 million. That means the headline jobs gain of 151k reported on Friday amounted to only 7% of the adjustment amount!

Any economist with a modicum of common sense would recognize that even a tiny change in the seasonal adjustment factor would mean a giant variance in the headline figure. So the January SA jobs number cannot possibly reveal any kind of trend whatsoever — good, bad or indifferent.

… Actually, it proves none of those things. For one thing, the January NSA (non-seasonally adjusted) job loss this year of just under 3 million was 173,000 bigger than last January — suggesting that things are getting worse, not better. In fact, this was the largest January job decline since the 3.69 million job loss in January 2009 during the very bottom months of the Great Recession.

This technically correct but misleading, a nice demonstration of how clickbait makes its readers dumber. Seasonal adjustments are large in volatile data like payrolls, difficult but necessary adjustments to the monthly numbers. Also, it is difficult to see the trend amidst the tiny monthly changes in the large US workforce.

There is an easy alternative to ranting: look at the percent changes in the non-seasonally adjusted year-over-year change (the population grows, so percent moves better show the comparable changes).  The graph shows a clear picture…

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Stratfor: What Kind of Great Power Will China Become?

Summary: How China wields its growing power will help shape the geopolitical world of the 21st century. Here Stratfor looks at China and speculates at what it might become. {1st of 2 posts today.}

Stratfor

What Kind of Power Will China Become?

Stratfor, 3 February 2016

These are grim times for the Chinese economy. In the two years since property markets peaked and subsequently began to slow in most cities across China, it has become abundantly clear that the approach to economic management that sustained double-digit annual growth for two decades has exhausted itself. The unprecedented stock market volatility of the past year, along with signs of spreading unemployment and labor unrest in many regions, are important reminders that the transition to new foundations of national economic growth will in all likelihood be bitter, slow and unnervingly uncertain.

In times like these, it is tempting to embrace visions of irreversible decline — just as it was easy, in the expansive years of consistently high growth, to view China’s rise as straightforward and inevitable. As Stratfor pointed out well before the 2008-09 global financial crisis, which set in motion many of the policies and processes that underlie China’s current woes, the only certainty in the high-growth years was that they would someday end. Their ending, we predicted, would unleash tremendous and potentially destabilizing social pressures long kept at bay by the promise of universal employment and rising material prosperity. At the least, this process would slow China’s political, military and economic rise as the decade ends. At worst, it would send China into a more debilitating and longer-lasting period of crisis and fragmentation.

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Surprises in the January jobs report

Summary: The monthly job numbers tell us much, but the headline number about which the press obsesses tells us almost nothing. This post looks at the trends that shape America as shown in this report, and especially the surprises.

Economy

 

Journalists and economists ask if we are in a recession. The tabloid investment media screams “yes”.  Last week Professor James Hamilton provided a clear answer: no.  It’s the wrong question. We should be like sailors, scanning the horizon to see the storm before it hits, taking incremental steps to prepare as the odds of a storm grow – eventually battening down the hatches and reefing the sails — before it’s too late to do so.

Macroeconomic data provides our best warnings of economic storms. The monthly payroll report — released today for January — gets massive attention, but we must dig to get the useful insights.

The headline job number is too volatile and too heavily revised for use (also, it is a lagging indicator), but the trend in the percent change year over year NSA tells us much – the rate of growth slows rapidly in the year before a recession, hence months before stocks roll over. Payroll growth peaked in February 2015 at 2.3%, steadily falling to 1.9% in January.

NonFarm Payroll - YoY percent change NSA

Let’s look below the headline number at some of the weaker sectors. Such as manufacturing, so far the center of the downturn. Manufacturing added 29,000 jobs in January, the second monthly gain and the largest since November 2014. What does this mean? I have no idea. It is an anomaly. Economists and journalists seldom point to anomalies in the data, although that should be a priority. Anomalies point to changes in trends and errors in our beliefs.

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Scrum: a new organizational tool that will help shape the 21st century

Summary: A new industrial revolution has begun. We usually think of these are new tech and new machines, but they also create new ways of thinking and new methods of doing business — changes almost as important as the new tech. Here Mike Few discusses new ways of problem solving, which create new forms of organization. {@nd of 2 posts today.}

The F3EAD framework

Scrum: how it works

Combat Scrum: From Iraq to the Research Triangle Park

By Mike Few (Major, US Army, Retired)
Introduction to his presentation at the Global SCRUM GATHERING®
18-20 April 2016 at Orlando, FL

The day was March 25, 2007, our unit was 5-73 Recon (Airborne), and these events would culminate into what was known on the strategic level as the Iraq Surge.   After much failure, we knew that we were losing the war.  We decided to change our thinking and adopt a decentralized, adaptive framework to try and salvage a win. The results were astonishing — real, tangible patterns not whitewashed Orwellian KPI’s {key performance indicators} on a PowerPoint slide to brief the Generals.

Down in a desolate, lonesome river valley, over a 90-day period, things begin to change as we changed our behavior.  Our empowered teams began collecting actionable intelligence, we were able to penetrate deep into enemy territory and neutralize several enemy-training camps, and our squadron became one of the most decorated units during the Surge. I didn’t know it at the time, but we were practicing Scrum,

  • Incremental, iterative operations to accomplish mission, just like sprints.
  • Routine, deliberate adaptive planning meetings to identify and prioritize goals, just like backlogs.
  • Decentralized execution with absolute collaboration at the team level.
  • Post-operation inspection of results followed by debriefs to adapt and restart planning.

Today, I serve as the leader of an Agile Program Office at a Financial Technology company practicing Holacracy.  I help coach, mentor, and guide teams building 30 different hardware and software solutions for handling cash in both financial and retail markets.  However, I have no formal background in software or computer science. I suppose that you could consider me an Accidental ScrumMaster and an Agilist.

Combat taught me Scrum.  Through a trial by fire in an unforgiving environment, I learned to change the way that I see and understand problems.  There are thousands of other veterans out there like me that learned the same lessons, and they could have an immediate impact in your business for real results.  Here’s how we did it.

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50 years of warnings about the new industrial revolution. It’s here. Ignore the naysaysers.

Summary:  The new Industrial Revolution is now upon us. We have sufficient warning and, with the experience from the earlier ones, should be able to navigate through it to a prosperous future without massive suffering during the transition. This is the latest in a long series about what might be the major economic event of the 21st century. {1st of 2 posts today.}

Danger, Construction Ahead

There is a safe path to the future.
“Danger, Construction Ahead” by Kay Sage (1940)

 

Contents

  1. Preparing by closing our eyes
  2. James Blish warned us
  3. Jeremy Rifkin’s bleak forecast
  4. Politics of new industrial revolution
  5. Conclusions
  6. For More Information

 

(1) Prepare for the future: close our eyes

On September 23 {William the Conqueror’s} fleet hove in sight, and all came safely to anchor in Pevensey Bay. There was no opposition to the landing. The local fyrd had been called out this year 4 times already to watch the coast, and having, in true English style, come to the conclusion that the danger was past because it had not yet arrived had gone back to their homes.

— From A History of the English-Speaking Peoples by Winston Churchill.

The development of semi-intelligent machines, with simple sensory systems and IQ equivalents of 60+ (in a small domain), will destroy a large fraction of today’s jobs.  Perhaps we’ll find new forms of employment.  Perhaps we will develop new economic systems which require fewer people to work.  If delayed into the second half of the 21st century, the almost inevitable population crash (esp. following the invention of a contraceptive pill for men) will make automation a cure — not a curse.  All of these solutions will require innovation, wisdom, luck — and time.

But the need to adapt is not obvious to everybody. In her deep 1989 book In The Age Of The Smart Machine: The Future Of Work And Power Shoshana Zuboff does not even use the word “unemployment” — or mention the potential for massive job losses.

This “robot revolution” is long-predicted and now arriving, but some interpret that it took long to arrive as evidence that it will not come. For example, past week Elizabeth Garbee at Slate wrote “This Is Not the Fourth Industrial Revolution” — “The meaningless phrase got tossed around a lot at this year’s World Economic Forum.”

Here are three forecasts of the coming robot revolution. Let’s learn from their insights, and get ready.

(2)  Science fiction then; now our future

The effects of automation were visible to some people long ago. One of the first was James Blish, as in this his A Life for the Stars (1962), the second of his Cities in Flight series. This passage describes what New York might look like in the late 21st century.

The cab came floating down out of the sky at the intersection and maneuvered itself to rest at the curb next to them with a finicky precision.  There was, of course, nobody in it; like everything else in the world requiring an I.Q. of less than 150, it was computer-controlled.

The world-wide dominance of such machines, Chris’s father had often said, had been one of the chief contributors to the present and apparently permanent depression:  the coming of semi-intelligent machines into business and technology had created a second Industrial Revolution, in which only the most highly creative human beings, and those most fitted at administration, found themselves with any skills to sell which were worth the world’s money to buy.

(3) Jeremy Rifkin’s bleak forecast warns us to prepare

Jeremy Rifkin is a Jeremiah of our time. But as a stopped clock is right twice a day, he scores occasionally — as in The End of Work: The Decline of the Global Labor Force and the Dawn of the Post-Market Era (1995):

The Information Age has arrived. In the years ahead, new, more sophisticated software technologies are going to bring civilization ever closer to a near-workerless world. In the agricultural, manufacturing, and service sectors, machines are quickly replacing human labor and promise an economy of near automated production by the middecades of the twenty-first century.

The wholesale substitution of machines for workers is going to force every nation to rethink the role of human beings in the social process. Redefining opportunities and responsibilities for millions of people in a society absent of mass formal employment is likely to be the single most pressing social issue of the coming century.

… We are entering a new phase in world history-one in which fewer and fewer workers will be needed to produce the goods and services for the global population. The End of Work examines the technological innovations and market-directed forces that are moving us to the edge of a near workerless world. We will explore the promises and perils of the Third Industrial Revolution and begin to address the complex problems that will accompany the transition into a post-market era.

… In the past, when new technologies have replaced workers in a given sector, new sectors have always emerged to absorb the displaced laborers. Today, all three of the traditional sectors of the economy agriculture, manufacturing, and service — are experiencing technological displacement, forcing millions onto the unemployment rolls.

The only new sector emerging is the knowledge sector, made up of a small elite of entrepreneurs, scientists, technicians, computer programmers, professionals, educators, and consultants. While this sector is growing, it is not expected to absorb more than a fraction of the hundreds of millions who will be eliminated in the next several decades in the wake of revolutionary advances in the information and communication sciences.

… The restructuring of production practices and the permanent replacement of machines for human laborers has begun to take a tragic toll on the lives of millions of workers.

(4) Politics of a new industrial revolution

For a grim look at our future see Progress Without People: New Technology, Unemployment, and the Message of Resistance by David F. Noble (1995). See his Wikipedia bio. The opening chapters are from his 1983 series of articles in Democracy about “Present Tense Technology”. The series opens with this stark warning from “Technology’s Politics“:

There is a war on, but only one side is armed: this is the essence of the technology question today. On the one side is private capital, scientized and subsidized, mobile and global, and now heavily armed with military spawned command, control, and communication technologies. Empowered by the second industrial revolution, capital is moving decisively now to enlarge and consolidate the social domination it secured in the first.

… Thus, with the new technology as a weapon, they steadily advance upon all remaining vestiges of worker autonomy, skill, organization, and power in the quest for more potent vehicles of investment and exploitation. And, with the new technology as their symbol, they launch a multi-media cultural offensive designed to rekindle confidence in “progress.”

On the other side, those under assault hastily abandon the field for lack of an agenda, an arsenal or an army. Their own comprehension and critical abilities confounded by the cultural barrage, they take refuge in alternating strategies of appeasement and accommodation, denial and delusion, and reel in desperate disarray before this seemingly inexorable onslaught —- which is known in polite circles as “technological change.

What is it that accounts for this apparent helplessness on the part of those whose very survival, it would seem, depends upon resisting this systematic degradation of humanity into mere disposable factors of production and accumulation?

Conclusions

“We’re all sorry for the other guy when he loses his job to a machine. When it comes to your job, that’s different. And it always will be different.”
— Dr. McCoy, star date 4729.4, in the Star Trek episode “The Ultimate Computer.“

We have no excuse for being caught unaware and letting this new technology destabilize our society and cause widespread suffering. With modest planning we can enjoy its fantastic benefits without pain. Failure to plan for these obvious developments might mean some tough times ahead for America.

Our world in their hands.

(5)  For More Information

If you liked this post, like us on Facebook and follow us on Twitter. See all posts describing how the 3rd industrial revolution has begun. Also see the posts about the evidence that we’ve entered a period of secular stagnation. And especially see these…

For deeper analysis see these books…