Moving in the right direction

2011 draws to a close with financial instability and climate change topping the agenda of global issues to confront in 2012. The signs are, however, clear that a co-ordinated, multi-governmental approach to problem solving is an emerging trend, if a hotly debated one, with developments of the past week underlining the increasing relevance of intergovernmental approaches to problem solving.

Yesterday, new capital disclosure templates were published for comment by the members of Basel III, the latest in international regulatory standards for banking, requiring banks in more than 30 countries to use a common format for disclosing the size and quality of their capital safety margins to investors.

Last week, the COP17 summit gave birth to a new agreement that commits all signatories to developing a future framework for legally binding carbon emission reductions, bringing hope of an eventual remedy to one of the key deficiencies of the Kyoto protocol.

However, in the same week, Britain elected to abstain from participation in a treaty intended to protect to the European market, leading to wholesale domestic re-evaluation of Britain’s role in an evolving European Union.

The debates will continue in 2012 with the evolution towards intergovernmental co-operation being resisted by nationalists sounding somewhat outdated calls for increasing independence in an increasingly inter-dependent world. Because rationalism tends to favour harmonisation, trends towards integration are seldom opposed on rational grounds but rather through messages of sound and fury, fear and loathing.

When Southern States began advocating for secession from the United States to preserve their "economic interests", Abraham Lincoln famously pointed out, three short years prior to the commencement of the US Civil War, that “a house divided against itself cannot stand”.

Provided that the slow evolution of international co-operation and regulation never comes at the expense of freedom of culture or expression, or the principal of subsidiarity (a principle that affirms that a more centralized level of government should exercise only those responsibilities that cannot be more effectively handled at a local level) then latter day nationalists should hopefully, ultimately, and without necessity of war, come to understand that they have little to fear from a more co-ordinated approach to solving the big problems that affect everybody equally.

For all the contemporary criticism leveled against the European Union, none of these critics lived through the continents’ great wars and nothing in their criticism can trump the truth: from the time European supra-nationalism was first introduced, major warfare amongst member states became unthinkable.

Let’s hope 2012 sees our global body politic keep moving in the right direction.

Kent Cops Out

Peter Kent, Canadian Environment Minister, says India and China are amongst the world’s biggest pollution emitters. He uses their “developing nation” exemption from the emission reduction standards of the Kyoto protocol as a possible basis for Canada’s withdrawal from the treaty. 

But here’s the irony: while Canada might have previously committed itself to carbon emission reduction targets of the Kyoto Protocol, in the last decade Canada’s merchandise imports from India increased by over 60% and imports from China have risen to over $44 billion per year. 

From a horse of such giddying height as the one he obviously saddled before cantering into Durban, can Peter not see that where a nation commits itself to emission reduction targets, if it then simply increases its imports of goods from the very developing nations it criticizes, it’s not actually reduced the level of carbon emitted into the atmosphere, but simply shifted production from its own back yard to somebody else’s? 

Climate control has descended into a debate between developed and developing when, in truth, there’s only one atmosphere and everyone will lose from a negotiation stalemate. Kent suggests that the Green Climate Fund is a “guilt” payment demanded by developing nations when it is simply one proposal to finance cleaner power in developing nations. The Fund and the global carbon tax are strong ideas that deserve rational consideration – perhaps Kent’s projection of morality and guilt onto the negotiating floor belies his own state of mind more than anything else, especially after Greenpeace produced this terrific piece of satire about him earlier this year.

Occupy Wall Street: Demand # 1

It’s been very impressive.  The commitment, the organisation, the sheer tenacity.  But having taken Wall Street hostage, it’s time to send through at least one clear demand.  

This would be my proposal:

Demand # 1: Nationalize the Federal Reserve.

Social Media - New Kid on the Evolutionary Block

Within any adaptive system there are considerable advantages to the development of information and communication (neural) networks between system components to enable the adaptive response and re-organization of the system.

If the Universe itself is an adaptive, responsive, system (as it seems to be) then Social Media should probably be understood as the new kid on the evolutionary block.

While still just infants now, social media platforms will mature to offer more highly aggregated content services and the streaming of an increasing amount of sensorial, neurological and positional data in real time. 

Eventually bionic sensory organs will even make it possible for people to literally see what others are seeing and hear what others are hearing in real time. If this seems too far-fetched to you for now, consider the fact that cochlear implants can already capture sound and directly stimulate cochlear nerves by electronic impulses (making it possible for persons with damaged hair cells on the ear’s basilar membrane to hear) and that implanted retinal devices enable light to enter micro-cameras, bypass damaged retinas and electronically stimulate optical nerves (enabling some blind persons to see).

 It doesn’t require a major conceptual leap to recognize that these electronic devices will one day record the sights and sounds they can sense and that these recordings could ultimately be relayed by micro-wireless transmitters, streamed to websites and shared with other people. Microsoft has already purchased the patent to transmit data using the human body - you can view the patent itself here. 

Humanity seems destined to benefit from increasingly reliable and replaceable bionic organs and if all the sensory information directed at a person is recorded and redirected towards a person’s social media page, then anyone accessing that person’s site will be able to take a real-time walk in that person’s virtual shoes. 

Hopefully all this sharing of "what's on our minds" will lead to greater empathy and understanding between us but an increasingly important issue to debate and address will be the degree to which users can personally control what information to stream and precisely when to stream it.  Privacy has already become the wild new frontier of social psychology with different social media behaviors currently being flame-tested for social acceptability.

While it may seem frightening at first, the gradual collapsing of the boundaries of self-consciousness and the progressive ease with which we will identify ourselves and others as parts of a collective body of consciousness are evolutionary processes in themselves and social media should be understood as the evolutionary development of new neural pathways in our systemic consciousness. 

15 October

The events of 15 October 2011 deserve to go down in history as the first globally co-ordinated protest of the 21^st century. From the Arab Spring, through to the European summer of discontent, the citizens of individual nations have taken turns in expressing their indignation at different systems that they believe are failing them.  But on 15 October, persons from all over the world stood simultaneously for global change.

Much of the detail of the protests center on financial issues, including sovereign currency crises.  What follows are some thoughts on the continued use of domestic currencies in the modern global financial system:

(1) Domestic currencies are, by definition, intended for domestic use only.  To trade internationally one has to exchange currencies through registered brokers and the buy/sell differential rates immediately remove 2,5% of the economic value of each international exchange.

(2) When banks hold their assets in their domestic currencies but borrow in foreign currencies, they make a mockery of minimum liquidity regulations and can, as a result, be thrust into financial distress as result of remote events or weather patterns over which they have little influence or control. Older members of society who depend on savings and investments to generate their income (a demographic group you might not yet belong to but one day surely will…) are particularly vulnerable to the erosive effects of currency depreciation.

(3) When currencies were lifted from objective standards like gold and became valued relative only to other currencies, changes in economic conditions in one region quickly began affecting the value of currencies in other regions. As the global web of trade expanded and became increasingly complex, the inherent instabilities of a financial system based on cross referenced free-floating currencies became more pronounced and institutional speculators began to exploit, and in the process exacerbate, these inherent instabilities for profit.  

(4) Many people have identified the property market bubble in the United States as one cause of the current financial crisis without going further to consider that the United States dollar depreciated against major international currencies by 30% between 2002 and 2007 which encouraged the production of more money by the US Federal Reserve, drove investors towards fixed property assets and banks towards property backed lending, resulting in the property bubble.

So here’s a proposition to consider: the single most effective and practical intervention that can be made to reduce financial instability in the global economy is to introduce a common international currency and allow the price of products and services across different regions to be more naturally determined by factors of quality, supply and demand.

If you don’t agree with the above proposition, then you either don’t believe that the financial system has become inherently unstable or you believe there is a more effective and practical solution to the problem.  If it’s the latter, I hope you will share it.

This is Madrid on Saturday night.

Vitalstatistix Greatest Fear

The introduction to every Asterix book begins with a description of the leading characters.  Chief Vitalstatistix has only one fear: the sky might fall on his head.

He would be alarmed to note that on "approximately" the 23rd of September, a 6 000 kg NASA satellite that has run out of fuel is going to crash back to earth, somewhere between the latitudes of Edinburgh and Cape Town.  That's "approximately" on Friday. 

No one is sure exactly where and when the decommissioned satellite will land, or how much of it will be left after burning up through the atmosphere - NASA's current estimates are that 532kg of debris will hit the ground at speeds of up to 100 metres per second.

NASA estimates that the odds of a person being killed by any of this falling debris are "1 in 3200".

(Your chances of picking all the right numbers in the lottery are 1 in 13983816).

NASA doesn't explain how this vital statistic has been calculated - perhaps they've worked with the estimated size of the scattered debris and the average density of humans across the surface area of the potential strike zone.  But however the “1 in 3200” risk of loss of human life on slide 8 of this NASA powerpoint has been calculated, it probably serves a public relations purpose at best, because even if NASA had calculated the risk to be much, much higher, I’m not sure that Asterix ,or even Ben Affleck, could do anything about it.

Marvellous.

Inter-nationalisation

Deep underground in the bedrock of Manhattan lies the vault of the Federal Reserve Bank of New York, home to 7 million kilograms of gold bullion owned by governments and banks from around the world.

There’s an inescapable irony in expending massive amounts of time, money and human energy, even lives, to extract this metal from the great depths of the earth only polish it up and then hide it underground again.

The depositors of the gold are the ultimate beneficiaries of a series of transactions that begin with a premise that resources located beneath a particular section of the earth’s surface automatically belong to the people who exercise control over that patch of the planet’s crust.

It should come as no surprise then, that from colonial times through to contemporary, the relationship between natural resources and warfare has always proven to be intimate.

As recently as April 2007, a Russian submarine provocatively planted a flag on the Artic shelf as part of an expedition to claim exclusive ownership over the region’s estimated 10 trillion tonnes of fuel reserves in accordance with the UN Convention on the Laws of the Sea. Tension over this claim is bound to heat up as the surface ice continues to melt, making exploitation of the region increasingly viable.

In an era characterised by a rapidly growing populations and diminishing natural resources, International Law 2.0 needs to be urgently developed.

The Earth is, quite obviously, one indivisible system and only a global framework of shared, equitable access to the planet’s natural resources, including fossil fuels and water, will achieve humanity’s sustainable occupation of the planet. Unless every single nation on the planet commits to a new, enforceable global resource and environmental protection framework, then every other nation’s future will be at risk.

Commentators that confine contemporary debate over the ownership of underground resources to private versus national ownership are trapped within the context of a very outdated paradigm.

It’s time that debate on inter-nationalisation of natural resources began.