It’s the crudeness: As if more the sheer numbers of people were even a credible unit of analysis, full stop, for policy or management. As if complex could be abbreviated simply.

Not a scintilla of recognition:

• that perceptions and management of policies differ, at least, by a person’s age, education, income, gender, and ethnicity;
• that not-knowing, difficulty and inexperience with respect to population numbers and to perceptions, at the very least, set disciplines, fields and ways of being apart from each other;
• that what stops further polarization of disciplines, fields and ways of being are not fewer numbers but the not-knowing, difficulty, and inexperience; and
• that when the numbers do polarize, fear becomes a solipsism, believing itself to be an anti-politics machine.

Default to numbers on their own is, in other words, an Olympian capacity to deoxygenate all living matter.

I

That people act in an imitative fashion under conditions of high economic uncertainty is not news: Panic selling, spiraling inflation, overheated art markets, and speculative frenzies (I sell when you sell, buy when you buy) are some of the many instances of imitative economic behavior.[1] 

What’s bothered me, though, is the relative lack of reference in the economic literature to René Girard’s theory of mimetic contagion (mimetic desire, in his terms). Girard’s framework has major implications not identified by economists writing on market contagion and associated crises.

II

Brief description of a Girardian economics

From a Girardian perspective, financial and economic uncertainty begets ever more uncertainty, as more and more people imitate each other in a desperate rush to figure out what to do. At some point, classes of people are arbitrarily identified (scapegoated in Girard’s terms) as the cause of the crisis, widespread violence ensues against or because of them, and new financial and economic institutions emerge from the hostile, violent conditions.

Most economic contagion models do not go that far in predicting violence (to be clear, predicting does not mean advocating).[2]

Contagion modelers argue that the way to break the cycle of imitation is through more accurate information. Girardians will have none of that. They insist the underlying and overwhelming problem is pervasive uncertainty for which there is no recourse to “certainty” to solve. Appeals to “market fundamentals” or “getting back to normal” stabilize temporarily, and that is at best only. Such appeals do not and cannot resolve the baseline widespread uncertainty that corrodes each and every stabilization effort.

In a Girardian economics, the more uncertain things are, the more wealth we desire to buffer against that uncertainty; but the more wealth we have, the more desire we have for even more wealth. The specification of wealth itself becomes increasingly problematic as uncertainty persists. Once wealth “ceases to be identified with the instituted money, [economic agents] no longer know behind which mask it is hiding.  Stocks, real estate, gold, foreign currencies, primary commodities, etc. attract the anxious attention of individuals looking for likely refuges from the ‘terrible oscillations of chance’,” the economist, André Orléan, writes.

This leads to what Girard calls a crisis of undifferentiation. Uncertainty becomes everywhere intensified; economic behavior grows more and more uniform; and ever more wealth becomes desired as “what is wealth?” becomes increasingly difficult to answer. Markets undergoing crises of undifferentiation—epidemics of contagion where everyone ends up imitating each other—are instances where we do not know enough to distinguish, in econo-speak, satisficing from maximizing or the second-best from the Pareto-optimal, and where no one is clearly right but where everyone hopes they are.

Girardian features of the 2008 financial crisis

This sense of free-fall and groundlessness is neatly captured in the comments of bankers and investors just before and during the 2008 collapse of Lehman Brothers. “It feels as if we are 15 minutes away from the end of the world,” the head of equities at a large U.K. bank told the Financial Times about the lead up to the first major U.S. bailout.

“The market has changed more in the past 10 days than it had in the previous 70 years,” reports a senior executive at a European investment bank in 2008. “We have no idea of the details of our derivative exposures and neither do you,” conceded a senior Lehman Brothers official at a meeting of bankers and regulators just before it collapsed. “The crisis continues because nobody knows what anything is worth,” said one informed observer. The chair of Morgan Stanley Asia concluded, “We have gone to the edge of an abyss that few thought was ever possible”. I can find no reports of financial experts appealing to “underlying” market fundamentals during these weeks.

For Girardians, people under these conditions–these crises of undifferentiation–respond by scapegoating. Scapegoating provides the certainty to move on. Reports from and about the last quarter of 2008, with the collapse of Lehman Brothers, the bailout of Freddie Mac and Fannie Mae, and the further bailouts of AIG and Citigroup, were replete with terms such as “panic,” “herd instinct,” “mob mentality,” “mob rule,” “witch hunting,” “finger-pointing,” “lynching,” and “show trials” along with the ubiquitous referencing of “scapegoats” and “scapegoating” (all terms from contemporaneous reports in the Financial Times).

Many commentators, of course, believed they were in fact correct in their blaming this one or that one for the crisis. Girardians argue, in contrast, that the choice of scapegoat is completely arbitrary, where pervasive uncertainty drives economic behavior. Some of this arbitrariness was witnessed in the belief that if no one is to blame, then everyone is. We were told “there is enough blame to go around for every one” and “we are all to blame for the meltdown.”

In heated financial markets where everyone is buying or selling at time t+1 because, well, most everyone was buying or selling at time t, there is no way to validate that selling save by stating it is what everyone else was and is doing. This point was famously made by Chuck Prince, former head of Citigroup, when he told the Financial Times in mid-2007, “When the music stops, in terms of liquidity, things will be complicated. But as long as the music is playing, you’ve got to get up and dance. We’re still dancing.”

But where’s the blood?

Its focus on an ensuing violence, however, is what sets a Girardian economics apart from other contagion models. A full-blown Girardian economics, at least as I understand it, would hold that imitative behavior goes beyond the scapegoating. It turns into mob behavior, not as a reporter’s hyperbole but in actuality. People are killed, and it is only after widespread violence that people respond in revulsion to their behavior by forging social and economic conventions so that such violence “never happen again.” In this view, new economic and financial institutions arise only after panic and mob-like behavior and the post-hoc rationalizations for what all the preceding “really” meant.

We certainly heard calls from politicians and regulators alike for “never again,” when it came to the 2008 financial crisis. So too, a manager or two committed suicide or disappeared from the scene. But it is an odd sort of crisis when those harmed on such an unprecedented scale did not take screaming to the streets. In 2008, we witnessed food riots over crop prices but no real violence over this massive wealth destruction. Which prompts the question: “Where’s the blood?, as René Girard asked me when I presented my version of a Girardian economics at his Stanford seminar.

I suppose some of it is there if we look for it. Already well documented, murder and suicides and violence do go up during a severe economic downturn like the one to which this financial crisis led. This, however, scarcely qualifies in Girardian economics as mob behavior essential for the rise of new social convention and institutions governing finance and economics.

So what happened?

In July 2009, former Treasury Secretary Henry Paulson testified before Congress on his involvement in the financial crisis. He admitted he had been deeply concerned about frightening the public if he expressed his real fears about the financial system unraveling: “[W]hen a financial system breaks down, the kinds of numbers that we were looking at in terms of unemployment was [sic] much greater than the numbers we’re looking at now. People in the streets, and of course, around the world—it was very significant and I remember talking about it…”.

But people did not take to the streets. Why?

Girardians, as I understand them, would resist two popular “answers:” (1) government interventions worked, and/or markets went back to fundamentals; and (2) it is too early to say how things are working out. As such argued, Girardians would have expected considerable violence during and after events of September/October 2008, and there is no chance, as I understand them, that such reforms to the financial system as there were would ever make things more “certain” in the absence scapegoating and ensuing violence.

My answer

There are at least four ways in which a crisis of economic undifferentiation could be delayed, albeit not averted, when comes to market contagion. More, if I understand Girardians, these four ways are the value added to contagion models of the financial crisis already proposed by mainstream economists:

If you can’t reduce pervasive uncertainty, the next best alternative is to impede the resulting rivalry (“increase the costs of rivalry”);

If you can’t reduce the rivalry, the next best alternative is to impede the associated imitative behavior (“increase the costs of imitation”);

If you can’t reduce the rivalry or imitation, the next best alternative is to foster and prolong differentiation (“decrease the costs of differentiation”); and

Lastly, if you cannot do any of the above, the alternative is to slow down or wait out the crisis of undifferentiation (“increase the costs of undifferentiation”).

These actions are, I believe, what have been happening by way of the financial and economic reforms undertaken since 2008. Their effect has been to delay the consequences of the financial crisis by sidelining the scapegoating. Let’s examine each in more detail:

Increase the costs of rivalry.

In the Girardian framework, markets are mechanisms to increase the transaction costs associated with rivalry, not decrease them, as conventional economic theory would have it.

Markets are what keep us from killing each other for the goods and services we desire. They transform us into price takers rather than commodity thieves. What happened in the lead up to the 2008 financial crisis was just such increased thievery (e.g., insider trading and predatory lending). Many existing and proposed reforms—most notably, increasing capital adequacy reserves in banks and lending institutions—have been intended to make the excesses of rivalry too costly to undertake.

But increasing the costs to rivalry poses a dilemma from a Girardian perspective. To increase their costs may lessen that rivalry, but the higher costs serve as an incentive for increasing the wealth needed to cover (buffer against) the now-higher costs associated with rivalry. For Girardians, it is no surprise that firms, such as Goldman Sachs and JPMorgan Chase, were driven to return to wealth-making faster than would have been expected given the economic conditions and liquidity shortages said to exist at the time.

Increase the costs of imitation.

The principal feature of the lead-up to the 2008 financial crisis was that costs of imitation were too low. Behavior, as many pointed out, became positively correlated, when finance theory insisted such behavior should have been uncorrelated through risk dispersion.

Instead of diversification and risk spreading, hedge funds and others ended up acting in very similar ways. Either “[t]oo many funds bought the same assets” or the “problem was that, while these assets are heterogeneous, the owners were not. In tough times they behaved the same way….Diversification was therefore fake”. “Far from promoting ‘dispersion’ or ‘diversification’ [financial] innovation has ended up producing concentrations of risk, plagued with deadly correlations,” according to a Financial Times’ correspondent at the time.

Calls for “increased transparency” are routinely given as the solution to this problem. Risk cannot be concealed or obscured if financial processes are transparent, so this argument runs. From a Girardian perspective, such calls are self-defeating. Greater transparency would reveal the financial system is transparently complex and in many ways visibly beyond human comprehension when it comes to measurable risk and unmeasurable uncertainty. At worst, everyone sees the system for what it is, a house of cards impossible to shrink through “better risk management” or shrink-wrap with “better macro-prudential regulation.”

Either way, calls for greater transparency would lead people to becoming even more rivalrous as they hunt for ever greater wealth to protect or buffer themselves.

Decrease the costs of differentiation.

Now things get really interesting. You saw everywhere in the 2008 financial crisis the insistence of major participants that each differed from the others and that they were not—repeat, not—all alike.

Hedge funds insisted they did not start the financial crisis but that banks and investment houses did; the latter institutions insisted they were not all the same, some were better (or accused of being worse) in managing securitized assets; not all securitized assets were the same—that is, all toxic; more, not all toxic assets were equally valueless; still others argued that it depended on the valuation procedure used and few agreed which was the better one; no over-arching agreement, moreover, because the regulators themselves did not agree….; and so on.

Against a Girardian background, this sustained insistence on differentiation, even as finance and banking were in the midst of uncertainty, is especially important to note. Circumstances remained, at least in the minds of the finance sector, differentiated in major forms before and through the crisis. Very different social conventions emerged with respect to financial transactions, and the conventions evolved and innovated at that time as they diffused through institutions and among their participants. While accusations of “You’re all the same!” reached near fever-pitch, banking and finance services were still far from being homogenous and uniform, even during the crisis and the Great Recession that followed.

In other words, the blame game remained cheap throughout the 2008 crisis: The costs of differentiation were lower than one would have expected in a full-blown crisis of undifferentiation. I return to this point in a moment.

Increase the costs of undifferentiation.

A last strategy is to wait out the financial collapse in the hope that the longer people hold out before the crisis of undifferentiation becomes total, the more likely undifferentiation will not be total nor the contagion completed in full-blown scapegoating. One way to make undifferentiation “cost more” is to fuel the rumor mill about the who, why, how, when and where of the financial crisis, since it takes time to settle a rumor. (Small beer, but beer nonetheless.)

Since 2008, we have had an incoming tide of books and publications that keep all manner of whodunit suspicions and fevers alive. Rather than narrowing down identification of those who are “really” to blame, we have a surfeit of candidates said to have caused or contributed. In fact so many that some take the 2008 financial crisis to have been overdetermined. Instead of knowing who is to blame, we are encouraged to conclude, “With all that was going on, it would have been a miracle if the financial crisis didn’t happen!” Error here has many fathers when reliability is orphaned.

III

In short, scapegoating has become difficult to complete during and since 2008, thereby diffusing the prospect of violence and the rise of new financial institutions: . . . so far, Girardians underline. Yes, scapegoating has begun, some violence has been witnessed, but there has yet to be polarization around one scapegoat or defined set of them. Or from the other direction, what polarized agreement that has occurred has been more around phenomena—notably, rising inequality—than on specific groups or classes of agents.

Yet even if the financial crisis were not the one predicted by a purely Girardian economics—how could it be a crisis of undifferentiation and scapegoating without the violence?—it is remarkable how well the four types of interventions just described fit the course of events as we know them today.

As such, arguably the most telling lesson learned so far is that it can’t be assumed widespread uncertainty is pervasive uncertainty. There are extreme events where widespread uncertainty comes to us as separable uncertainties—more differentiated and differentiable than might first be supposed. Rather than being the lack of information, some uncertainties are very informative.

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Endnotes

[1] Conlisk (1980) wrote about the widespread importance of imitation in economic behavior. Topol (1991) focused explicitly on mimetic contagion in investment behavior. Scharfstein and Stein (1990) and Banerjee (1992, 1993) modeled herd behavior among investors. The critical-mass (“tipping”) models of Schelling (1978) and Akerlof (1984), as well as the “informational cascades” model of fads and cultural change developed by Bikhchandani, Hirshleifer and Welch (1992), captured the notion that, under uncertainty, economic agents end up copying each other’s behavior. Most famously, Nobel Laureate in Economic Sciences, Robert Shiller (e.g., Shiller and Pound 1989; Shiller 1989, 2006) writes about and focus on contagion models in investment and the strategic role of imitation among investors. He argues, for example, that the subprime mortgage crisis and the 2008 financial crisis that followed had a great deal to do with “the contagion of market psychology” that led to bubbles under the boom conditions of the turn of the century (Shiller 2008). More recently, Shiller (2019) has focused on the role of narratives in the spread of and response to market contagion and crises.

[2] Not all economists who rely on the Girardian framework focus on violence as the instigator of new economic arrangements. Scholars such as Jean-Pierre Dupuy, Mark Anspach, Paul Dumouchel, and André Orléan, among  others, have applied aspects of Girard’s contagion model to economics and related topics. In my view, the most notable application is that of economist, André Orléan, in his The Empire of Value: A New Foundation for Economics (translated by M.B. DeBevoise, 2014, The MIT Press: Cambridge, MA.). Violence is not a key feature of his analysis of money and the 2008 financial crisis in that book. (See also Orléan 1988, 1989, 1992a,b, 1998.)

References

Akerlof, G., 1984. A theory of social custom, of which unemployment may be one consequence. In An Economic Theorist’s Book of Tales. Cambridge University Press, Cambridge.

Banerjee, A., 1992. A simple model of herd behavior. Quarterly Journal of Economics 107, 797-817.

————— 1993. The economics of rumours. Review of Economic Studies 60, 309-327

Bikhchandani, S., D. Hirshleifer and I. Welch, 1992. A theory of fads, fashion, custom, and cultural change as informational cascades. Journal of Political Economy 100, 992-1026.

Conlisk, J., 1980. Costly optimizers versus cheap imitators. Journal of Economic Behavior and Organization 1, 275-293.

Orléan, A., 1988. Money and mimetic speculation. In P. Dumouchel, editor. Violence and Truth. Stanford University Press. Stanford, CA.

————, 1989. Mimetic contagion and speculative bubbles. Theory and Decision 27, 63-92.

————, 1992a. The origin of money. In F. Varela and J-P Dupuy, eds. Understanding Origins. Kluwer Academic Publishers. Netherlands.

———— (co-authored with Robert Boyer), 1992b. How do conventions evolve? Journal of Evolutionary Economics 2, 165-177.

———–, 1998. Informational influences and the ambivalence of imitation. In: J. Lesourne and A. Orléan (Eds.) Advances in Self-Organization and Evolutionary Economics. Economica: London.

Roe, E., 1996. Sustainable development and Girardian Economics. Ecological Economics 16, 87-93. The article is the principal source for this blog entry, though material from the original has been updated substantially.

Scharfstein, D. and J. Stein, 1990. Herd behavior and investment. The American Economic Review 80, 465-479.

Schelling, T., 1978. Thermostats, lemons, and other families of models. In Micromotives and Macrobehavior. W.W. Norton and Company, NY.

Shiller. R., 1989. Stock prices and social dynamics. Fashions, fads, and bubbles in financial markets. In Market Volatility. The MIT Press, Cambridge, MA

————, 2006. Irrational Exuberance. 2^nd Edition, Paperback, Broadway Business.

————, 2008. The Subprime Solution:  Today’s Global Financial Crisis Happened, and What to Do about It. Princeton University Press: Princeton, NJ.

————, 2019. Narrative Economics: How Stories Go Viral & Drive Major Economic Events. Princeton University Press: Princeton, NJ.

Shiller, R. and J. Pound, 1989. Survey evidence on diffusion of interest and information among investors. Journal of Economic Behavior and Organization 1,: 47-66.

Topol, R., 1991. Bubbles and volatility of stock prices: Effect of mimetic contagion. The Economic Journal 101, 786-800.

I

It turns out that what the Delphic oracle said about Socrates varies by the account given for how Socrates defended himself at his trial for impiety and corrupting the young.

Plato’s famous version has Socrates’ recounting that the oracle pronounced no human being wiser than Socrates. Socrates then goes on to ask, Aren’t there others in fact wiser? In the process, he seeks to underscore his knowledge of his own ignorance.

In contrast, Xenophon (a contemporary of Socrates and Plato) has Socrates saying the Delphic oracle pronounced no one freer, more just, or more prudent than Socrates. Socrates then proceeds by asking and answering nine questions which are meant to lead to that conclusion.

II

For my part, I like the updated composite version: wise enough to disagree, free enough to agree.

Socrates being wise is entailed in Xenophon’s version, whereas being wise in Plato’s version also means knowing you’re ignorant of things, including: prudently put, just how free am I?

III

Not quite, then, the ethics of “Do unto others as you would do unto them.”

Closer instead to: “I am not so arrogant, as to commend mine owne gifts, neither so degenerate, as to beg your toleration” (Robert Jones, 1611).

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Source: P.A. Vander Waerdt (1993). “Socratic Justice and Self-Sufficiency. The Story of the Delphic Oracle in Xenophon’s Apology of Socrates”. In: Oxford Studies in Ancient Philosophy, 11. 1-48.

When I and others call for better recognition and accommodation of complexity, we mean the complex as well as the uncertain, unfinished and conflicted must be contextualized if we are to analyze and to manage case-by-granular case.

When I and others say we need more findings that can be replicated across a range of cases, we are calling for identification not only of emerging better practices across cases and modifiable in light of new cases, but also of greater equifinality: finding multiple but different pathways to achieve similar objectives, given case diversity.

What I and others mean by calling for greater collaboration is not more teamwork or working with more and different stakeholders, but that they “bring the system into the room” for purposes of making the services in question reliable and safe.

When I and others call for more system integration, we mean the need to recouple the decoupled real-time activities in ways that better mimic, but can never reproduce, the coupled nature of the wider system environment.

When I and others call for more flexibility, we mean the need for greater maneuverability across different performance modes in the face of changing system volatility and options to respond to those changes.

Where we need more experimentation, we do not mean a trial-and-error learning where the next systemwide error ends up being the last systemwide trial destroying survival.

Where others talk about risks in a system’s hazardous components, we point to different systemwide reliability standards and only then, to the different risks and uncertainties that follow from the different standards.

I

“Healthcare” is considered to be one of the nation’s critical infrastructures sectors, according to the Department of Homeland Security.

Infrastructures, however, vary considerably in their mandates to provide their services safely and continuously. The energy infrastructure differs depending on whether it is for electricity or natural gas or hazardous liquids, while the latter three differ from large-scale water supplies (I’ve studied all four).

Yet the infrastructures for water and energy, with their central control rooms, are more similar when compared to, say, education or healthcare without such centralized operation centers.

Which provokes a useful question: What would healthcare look like if it were managed more like other infrastructures that have centralized control rooms and systems? Might the high reliability of infrastructural elements within the healthcare sector be a major way to better ensure patient safety?

II

Three points are offered by way of answer:

(1) High reliability theory and practice suggest that the manufacture of standard vaccines and compounds can be made reliable and safe, at least up to the point of the interface with patients. Failure in those back-end processes is exceptional—as in the 2012 fungal meningitis contamination at the New England Compounding Center—precisely because failure is so preventable.

Yet, under routine healthcare, it is the sharp-end of patient interface with those treatments that receives priority attention. The risk here is this focus dilutes attention, encourages complacency and divert management from the strong-end of healthcare, namely, the prevention of key production and distribution errors in healthcare without which patient safety doesn’t stand a chance.

(2) If healthcare were an infrastructure more like those with centralized control centers, the importance of societal dread in driving reliable service provision would be far more visible and dramatic.

Aside from that special and important case of public health emergencies (think the COVID-19 pandemic), civic attitudes toward health and medical safety lack the widespread public dread we find undergirding the reliability demanded of other infrastructures, such as nuclear power and commercial aviation.

Clearly, commission of medical errors hasn’t generated the level of public dread associated with nuclear meltdowns or jumbo-jetliners dropping from the air. Medical errors are often “should-never-happen events,” not “must-never-happen events.” What would generate the widespread societal dread needed to produce “must-never-happen” behavior?

One answer: Hospitals, if not managed reliably kill you. “Going to the hospital always means risking your life” is another way to put the dread. Once societal dread over medical error is high, expect to see medical errors of all sorts to be prevented more effectively.

(3) One response to preceding is to resist their implications and insist on treating healthcare from the doctor’s or specialist’s perspective as a craft or crafts surrounded by advanced infrastructure elements (think technologies and information systems).

Yes, mistakes are made, even horrible ones, but where would healthcare be without first and foremost the patients’ trust in doctors, staff and their expertise? (I’ll leave aside the fact that control room operators in major infrastructures are themselves craft professionals responsible for far more lives in real time than hospital and clinic staff!)

But in the high reliability management research with which I am familiar, distrust is as core as trust. One reason control room and front-line operators are reliable (that is, safe and continuous providers of services) is that they actively distrust the future will be stable or reliable in the absence of the system’s vigilant real-time management. Their wraparound support units—the experts in system engineering, economics, and modeling—may be telling them one thing and their unique real-time experience quite another.

From an infrastructure perspective, it is not surprising then that a US healthcare system that encourages each patient to be his or her own reliability manager entails a basic shift from the healthcare professionals as the primary wraparound for the patient to the patient’s immediate family, friends, and internet searches as primary support. More, the primary role of the latter is now to combat any complacency in patient treatment by healthcare professionals (complacency being a big risk in routine control room operations). Such tensions, including distrust of what are now seen as complacent medical professionals, are understandable from an infrastructure perspective and not ones to be smoothed over or otherwise “solved”.

III

So what?

Limitations of our analogy are obvious. The patient does not share the same situational awareness that his or her team/network of healthcare professionals may have about the him or her, and even then, the healthcare professionals may not have team situational awareness like that we have observed in water or electricity control rooms.

More, the electricity or water user is his or her own reliability manager typically only during severe water or energy shortages, when their participation and collective mindfulness in rationing is critical. Is a reliable patient necessary for a reliable healthcare system during high demand times (and again not just in a public health emergency) in the same way as energy-conscious or water-conserving consumers need to be during their high use times? Presumably, the movement to bring real-time monitoring healthcare technology into the patient’s habitation is increasingly part of the reliability calculus.

Yet in all this focus on the patient, it mustn’t be forgotten that there are healthcare control rooms beyond those of manufacturers of medicines mentioned above: Think most immediately of the pharmacy systems inside and outside hospitals and their pharmacists/prescriptionists as reliability professionals.

Note: I thank Paul Schulman for many discussions, suggestions, and points; the provocations that remain are mine alone.

When asked why they are studying [central bank digital currencies], responses from central banks do not focus on a single reason. The safety or robustness of the payment system, financial stability, efficiency of payments, implementation of monetary policy and the goal of greater inclusivity in accessing payment systems by lower income populations—all seem to be considered at least somewhat important. Lacking a single vision of what they want to accomplish, central bankers seem to be afflicted by a generalized sense of unease. Though scenarios can be only vaguely delineated, shifting sands in the payments and monetary landscape suggest to central banks that, if they do not provide a digital currency, they could find themselves isolated and weakened in unfamiliar ways. Having sufficient control over the retail payments system might, they suppose, prove to be essential for ensuring the stability and efficiency of the monetary and payments system.

From a quote in: Cesaratto, S. and E. Febrero (2022). Private and Central Bank Digital Currencies: a storm in a teacup? A Post-Keynesian appraisal. DT 2022/1, Working Papers, Department of Economics and Finance, Universidad de Castilla – La Mancha, Spain (accessed online at https://www.uclm.es/es/departamentos/daef/-/media/Files/A05-Investigacion-departamentos/daef/documentos_trabajo/2022-01-DT-DAEF.ashx?la=es)

Managed retreat is recommended as a response to rising sea levels confronting coastal communities, cities and major ports. We already have climate migrants in coastal Louisiana and like places, and the idea is to manage this out-migration more systematically.

What’s missing are assessments of the track records in the various managed retreat strategies already out there. The management of moving capitols, for example, has not been without its problems. Relocation of large numbers of people is even more difficult in humanitarian work.

What then might this mean in practice? One place I suggest to start thinking about managed retreat on the West Coast where I live and have done my research is the following:

Every time I visit South Sudan, the angels’ response to my criticisms never varies. “What would you have us do?” asked one exasperated aid worker as we sat drinking cold beers one night by the bank of the Nile. “If we leave, people will die.” He was right. A decade of government withdrawal from the provision of services, enabled by the humanitarian presence, and campaigns of government violence, partly paid for from humanitarian resources, had created a situation in which some people in the camps in Maban would probably starve if it were not for the aid agencies. The only solution the humanitarians can envision is to continue with this dystopic system.

Joshua Craze (2023). “The Angel’s Dilemma” (accessed online at https://thebaffler.com/salvos/the-angels-dilemma-craze)

Imagine, that is, not a historic retreat and resettlement of peoples from the coastline but rather masses of people who stay behind having nowhere else to go practically and who need indefinite humanitarian aid in order to survive.

–The root cause of unsustainability is often specified in ways that render us oblivious to history: The rationale for irrigated agriculture was to sustain crop production throughout the year; the rationale for burning coal was it generated a manifold increase over energy needed to dig it out.

–There is no little irony in a purely self-interested market approach to deregulated electricity coordination and a purely technology-based approach to decentralized electricity coordination that promises to automate out selfishness.

–Beau Brummell, when questioned by a companion which of the lakes he preferred, reportedly asked his valet, “Which one of the northern lakes do I prefer?” “I believe it is Windermere, sir,” replied the valet. Whereupon Brummell turned to his questioner, “Apparently it is Windermere.” Quite droll—until you realize his “apparently” is indifferent even to drollness. Indifference—this not caring one way or another—is a killer in public policy and management.

–I can’t be the only one struck by the affinity between those 19th century novels whose plots were driven by coincidence after coincidence all the way to a happy ending and today’s crisis narratives where one mistake after another has led to certain disaster.

–The obstinate truth is that the costs to society of confronting limitless disaster scenarios is set by the present danger of ignoring ones easy enough to identify and assess already.

Beliefs are like moods or Stimmungen in the sense that one can begin to believe X, and continue to believe X for some time, but then emerge from believing X into some other state of mind. And (the important point) one finds it as difficult to answer questions about one’s beliefs as to answer questions about one’s moods. Why do I believe X (why am I in mood X)? Why did I stop believing X (why did I emerge from mood X)? All one can say is: Today I am in mood X, but as to what mood I will be in tomorrow I cannot say. Today I believe X, but I cannot guarantee I will still believe X tomorrow. . . .
   Now I turn to your main question, which is: What are my beliefs?. . .My response to this question depends on my mood, as defined above. In my present sanguine mood my answer is yes. I believe that nature is orderly, and that, being part of nature, human beings have intuitions of order, of what a just order (a just natural order, a just social order) will feel like. I believe that non-human animals have intuitions of justice too. Furthermore, I believe that through education our inborn sense of justice can be brought to consciousness, cultivated, and fortified, helping us to distinguish (most of the time, though not always) between right and wrong.
   There you have it: the sketch of a moral philosophy with an antique metaphysical grounding.
   When I am in the opposite kind of mood, on the other hand, I believe that the whole creaky philosophical edifice I have erected for myself is nonsense, and life is nothing but the struggle of all against all.
   The fictions I have written – to conclude my response to your question – are not blocks of thought that can be articulated one with another to constitute a coherent set of beliefs. They are essays, ventures, expressions of the moods that have possessed me at successive stages of my life.

“The Summoning: An Interview with J.M. Coetzee.” Interviewer: Robert Boyers (accessed online at https://salmagundi.skidmore.edu/articles/481-the-summoning). The entire interview is a must-read.

Importantly, adaptive capacity [for emergency management] can be facilitated in part by planning and design processes that themselves create prior conditions, such as contacts among diversely skilled people in other infrastructures, robust communications systems and contingent resources in different locations, for restoration actions. In effect, there can be emergency planning process reliability even if the output reliability of subsequent emergency management cannot be predicted or guaranteed.

Paul Schulman, personal communication

I interpret the passage to mean that the mentioned design and planning interventions pass the ‘‘reliability matters’’ test. That is, robust contact lists, communication systems and distributed inventories, when implemented, are more likely to reduce the task volatility that emergency managers face, increase their options to respond more effectively, and/or enhance their maneuverability in responding to different, often unpredictable or uncontrollable, performance conditions. (In case it needs saying, not all design and planning pass the test!)

This notion that there can be reliability in processes to transform inputs into outputs, even if the input variability and output variability of emergency management are not predictable and stable, is incredibly important. Why? Because it shines a bright light on major but under-acknowledged temporal differences key for effective emergency planning and design.

It takes years to seismically retrofit a bridge from start to finish of its planning, funding and implementation. In contrast, a household becoming two-week ready (in terms of having supplies and provisions to last two weeks into the earthquake) is a matter of hours or days. This means the retrofitting of bridges and the implementation of the two-week ready program not only affect the success (or lack) of post-earthquake response. Their prior execution also helps date when planning and design processes started to produce those aforementioned conditions that alter the course (for good or bad) of the unfolding emergency widely visible only after the earthquake happens.

My point is that such mitigation development and implementation prior to the earthquake is measurable with respect to time: Is it in decades, years, months, days or hours? How do these different time horizons vary and congrue by type of mitigation? While no one can reliably predict when the earthquake will occur, it is not clear from our interviews that process reliability as just described is undertaken with an eye to identifying and better managing the different time horizons associated with different pre-disaster mitigations.

Not taking advantage of designing and planning inter-temporal mitigation processes that, together or singly, do increase options and reduce volatility in emergency management is not only a missed opportunity, it is also a correctible error.

Here’s a case in point. Calls by our interviewees for more administrative support to manage and coordinate local emergency preparedness may look like a routine complaint or a small-deal when compared to other city and county priorities. But from the perspective presented here, it is a very big deal in attempting to move the planning and mitigation agenda to identifying and managing latent inter-infrastructural interconnections and vulnerabilities before the earthquake happens.