Friday, March 27, 2009

Baseline

I was reading and commenting on a blog the other day. It is a good blog, make that a great blog, called baselinescenario.com. However, it is chocked full of people who are discussing things that are far from baseline. It does exemplify the problem that we have with our leaders today.

I have my background in system design and troubleshooting. When working on computers we have a “baseline” to determine the level at which the system is still working. It is called the “minimum system configuration.” This requires a motherboard, a power supply, and a graphics generator (graphics card and monitor). This is the bare minimal a computer needs to be functional. Problem resolution can come only after problem identification. It does no good to make up solutions without understanding what the source of the malfunction is. This would be like prescribing aspirin for a brain tumor.

This methodless madness, however, seems to be the approach of the leaders and learned alike. Nobody seems to have stopped to figure out what the cause (or causes in this case) of the problem is. No one has sat down and deconstructed the economy down to it “minimum system configuration”. While I have no real voice, I will for any who care to read.

It is easy to imagine the most basic society, because it exist today still. Bobbing little cultures on the open seas. Imagine if you will me, my wife, my dog, and a 30’ sailboat. We make up a perfect example of everything a society and an economy needs to remain stable. In order to survive, we need only to fish and sail. There is no cash, loans, or stock markets. It is purely democratic, with me and my wife each with an equal vote and the dog breaks all ties. Your work everyday is to catch or find food and water. It is a 7 day a week job. If you don’t do it, your economy falls quickly into recession and then depression. If we make bad decisions about how many offspring to have, it will sink us all. Adding another crew member means adding more to the work load. Later on it will mean one more to man the helm and fish. We are also responsible for financing and engineering the floating nation’s defenses. (let me tell you 30’ living aboard it is best to have a more diplomatic posture when possible.) This is it, the starting point of a functional economy. It is a little hard to apply this directly to our situation, so we might have to take this one step further.

So me the wife and the kid finds some land that we really like and we decide to become more permanently grounded. For examples sake imagine that it is us and one other family on the other side of the island. We build our hut out of local forage, identify local edible vegetation, weave some nets, and prep the land to try and tame some of the local grains. Us and the other family are technically a nation, we were not society, and definitely not a culture. We exchanged pleasantries but we give nor receive anything from them nor they from us.


Then one day the do something that interest of the other family. I had about 2 pounds of brewing yeast and the island had a great population of honey bees. 2 months later I had 3 cases of fine mead. Well it was fine to the lips that hadn’t had any in months. I couldn’t help but to share one with my male counterpart from the other family. He expressed interest in owning a few of these beauties. I expressed interest in a clear 5 gal. water bottle that bottle that he seemed to have a few extra of. A trade was made, and our first economic exchange was completed. This is economics at its basic form.

The settlers didn’t have home mortgages, health insurance, and auto loans. A family existed on its current assets. What the crops yielded is what they had to work with. A 40 hr work week would have been a blessing. There were no electric bills. Generally what the big wigs in Washington did was of less impact then what the weather was going to be like the next day. Bad weather in the short term as well as the long term was more damming to their income then the tax rate. Work was created by need. Farmers traded crops and livestock for that which they didn’t have. Houses were built by hand and often with help of surrounding community members. Doctors, blacksmiths and saloons were often paid in chickens or grain sacks.

For those of us who say “we were responsible” are not acknowledging the fact that outside of this basic model of economics, we are exposed to economic risk. What happened to the farmer? The factory moved into his city. They employed people that drove up the price and expectations of the local venders. Towns became cites. Farmers sons no longer know how to plant and harvest a field, slaughter live stock, or build a house. We no longer use the resources at hand to make our daily lives. We no longer trade with our neighbors for things that we both need. Children are no longer assets that grow to help us maintain our livelihood. They are liabilities that we leave at home or dump in schools while we go off and earn our living. They grow more distant from the basic understanding of economics. We have children without any assured way to keep them housed, fed, and clothed.
Our Leaders need to stop concerning themselves with “leverage”, “secured mortgages”, stocks, the ability to loan, or “retention bonuses”. They need to concentrate on how they can help us grow our own food, build our own houses, and trade with our own neighbors. They need to stop encouraging people who can’t afford it to have more offspring. Most importantly, they need to accept and explain that there are consequences to bad decisions including death. They need to tell the American people that just because your parents and grand parents did it, doesn’t mean that living a life that isn’t grounded in this self sufficient economic model is risky behavior. Then they must accept those lessons themselves.

This is one of those post that as I am finishing, I don’t know if I conveyed the idea that I was trying to. We all don’t have to live like the Amish. But we do have to live off resources that we already have earned. We need to be more aware of the impact of our actions. And we have to be prepared to sacrifice some seasons. Because no matter how complex the economic system is, we all live off the minimum system model. If you grow it and pick it from the ground you have added wealth to our economy. Whatever other activity you do to earn money is not stable and is just circulating existing wealth.

Here is a decent PDF file that goes through the history of money in the US . http://www.bos.frb.org/education/pubs/historyo.pdf as late as 1776 they were still having trouble establishing currency. People were not using their credit cards to survive. That is what made this country strong in more ways then one.

2 comments:

Anonymous said...

Just as with everything else you exaggerate the size of your sailboat.

Lord of Logic said...

Lol, this was a story of example. Let us face it, no way in hell i would take my wife on a live abroad voyage. If i liked her that much i wouldn't have married her.

Counter text

New counter