Half a dozen tips for staying oriented in the 21st century

Thoughts for the 2001 Quadrennial Defense Review by Dr. Linton Wells II (one of my mentors) outlines how much changed in the 20th century, and draws a simple lesson for today.

If you had been a security policy-maker in the world’s greatest power in 1900, you would have been a Brit, looking warily at your age-old enemy, France.
By 1910, you would be allied with France and your enemy would be Germany.
By 1920, World War I would have been fought and won, and you’d be engaged in a naval arms race with your erstwhile allies, the U.S. and Japan.
By 1930, naval arms limitation treaties were in effect, the Great Depression was underway, and the defense planning standard said “no war for ten years.”
Nine years later World War II had begun.
By 1950, Britain no longer was the world’s greatest power, the Atomic Age had dawned, and a “police action” was underway in Korea.
Ten years later the political focus was on the “missile gap,” the strategic paradigm was shifting from massive retaliation to flexible response, and few people had heard of Vietnam.
By 1970, the peak of our involvement in Vietnam had come and gone, we were beginning détente with the Soviets, and we were anointing the Shah as our protégé in the Gulf region.
By 1980, the Soviets were in Afghanistan, Iran was in the throes of revolution, there was talk of our “hollow forces” and a “window of vulnerability,” and the U.S. was the greatest creditor nation the world had ever seen.
By 1990, the Soviet Union was within a year of dissolution, American forces in the Desert were on the verge of showing they were anything but hollow, the U.S. had become the greatest debtor nation the world had ever known, and almost no one had heard of the internet.
Ten years later, Warsaw was the capital of a NATO nation, asymmetric threats transcended geography, and the parallel revolutions of information, biotechnology, robotics, nanotechnology, and high density energy sources foreshadowed changes almost beyond forecasting.
All of which is to say that I’m not sure what 2010 will look like, but I’m sure that it will be very little like we expect, so we should plan accordingly.

I’d like to contrast this point of view with the Black Elephant theory.

collapsonomics.org

The Black Elephant is best described as the “elephant in the room” which everybody will pass off as a black swan when it inevitably goes berserk. The black elephants are completely predictable: global warming, the demographic time bombs in various countries, technological acceleration resulting in whole new classes of global chaos and victimhood, and all the rest.

We, as individuals, are hemmed in on all sides by the fear that our lives are unpredictable, and the certain knowledge that there are also certain inescapable truths. Much as transhumanism promises extended life, and perhaps it’s a reasonable bet, nothing lasts forever. Our job is this: plan for the inevitable, hedge against the improbable, and try to reliably differentiate which is which. This is very difficult, and trying hard makes us neurotic. At best.

I’ve made my life using a methodology which tries to work close to reality as I understand it, heavily influenced by portfolio theory not as traders like Taleb might use it, but as the strategy and energy policy community use it. Policy is very different from running hedge funds.

Here are my six principles.

  • There are many, many kinds of capital. They interact in complex ways, but social capital is hard to measure, so it is systematically under-valued.

Therefore, strategies which lead with social capital approaches often outperform approaches which work in more conventional forms of capital alone. Mass production of relationships on social platforms is the crudest possible approach to this kind of model.

  • Complex systems behave unpredictably. Also they spend a lot of time twisting around other factors in society in ways which can be hard to understand. No complex system can be coerced into predictability.
Simple rules produce complex behavior.
Complex rules produce stupid behavior.
Andrew Hunt, 37 Signals
  • Gestalt and Jung are much better guides for understanding the behavior of organizations and the people in them than standard organizational psychology.
How Buildings Learn
  • Generational shifts are real: most people are instinctively driven to go through an experimental period in which they do things differently from their parents, then when they have children they keep the good parts of what they have learned, and revert to the inherited family patterns.
  • This results in a semi-predictable shift from generation to generation. It’s a fundamental bedrock driver of change, and all intergenerational cooperation has to cross these horizons. This has particular impacts on domains like political credibility. This is a special case of pace layering, in which different systems with different rates of change pull in different directions. It’s always worth understanding the place layers of the systems you are interacting with.
  • Most people are unable to form a fully integrated model of the world around them. They operate on continuously “open” models, without explicit axioms — only in their specific personal or professional areas of interest do they drill down enough to make up their minds about what is real or what matters. Most of the time, opinions (even those which drive behavior) are not bolted to anything. There is no world model which people are affixing their opinions to, they just float in space.
  • Most people live in the past. Particularly after they have children. Parents try to produce a bubble of relative stability for their children to grow up in. Between roughly 30 and 45 not much happens for most people outside of their family lives, and that stable layer is the core of most of our societies.

These factors together form a matrix through which I view reality. I hope you’ll find my notes useful in staying oriented!