10 March 2012

…And We Thought Nation States Were A Bad Idea

There’s a notion that I’ve been seeing crop up in more places: that our options for the future have narrowed. I’ve been wondering about this for a while—it’s a pretty basic set of questions when I think about it: what were our options in the past, what are our options now, what has changed, and what has stayed the same?

By Barath | Contraposition | March 7th, 2012

In this recent remarkable (though dry) talk on the 40th anniversary of the release of Limits to Growth, Dennis Meadows spells our options out as clearly as one can: sustainable development is no longer possible given the extent to which we have overshot the planet’s carrying capacity. Our global civilization has not made the changes required in time to avoid decline. However, this was not a foregone conclusion: their World3 scenarios were not predictions, and they didn’t all end in collapse. To the contrary, they represented an exploration of a number of possible outcomes, and suggested a positive and sustainable way forward. Since we didn’t choose that path, we foreclosed upon the high-development sustainable society that would have resulted.  While I’ve known all this and have been thinking it myself, for him to spell this out as clearly as he did—as someone who has spent over 40 years looking at these issues—is a reminder that we really should question (and probably ditch) any efforts aiming for sustainability within the current paradigm.

So what did he endorse instead? Resilience. The idea of targeting resilience over other approaches is one that I’ve been coming across more often. The idea that one should aim for resilience rather than try to predict and directly shape the future is one that comes up frequently in Taleb’s writing on Black Swans and a newer concept he calls Anti-Fragility. The basic notion, though I’m not sure I can really put my finger on it (Taleb can be a bit glib, but overall I find his ideas thought-provoking), is that systems that rely upon prediction for positive outcomes are exposed to potential cascading errors in those predictions that can lead to catastrophic results. Instead of building a system around predictions, building it around resilience to unknown outcomes does not require the ability to predict the future.

Taleb subdivides systems into three categories: those that are fragile (that suffer from shocks or randomness), those that are resilient (that are indifferent to circumstances), and those that are anti-fragile (that benefit from shocks and stresses, within some limits). Systems that rely upon prediction are fragile, and thus the first step is to move towards resilience, and then reach for anti-fragility where possible. (He discussed these ideas in more depth in a recent interview.) Interestingly, Toby Hemenway seems to endorse this decomposition, though he frames it a bit differently; he considers systems that range from degenerative to regenerative, with sustainable systems residing in the middle. (I suppose you’d have to say sustainable systems are resilient, since, well, they sustain; however, resilient systems don’t have to have macro-level sustainability.)

Many of the common proposals for resilience in a post-peak / post-carbon future—the kinds of proposals from Transition Towns and the like—are naturally aligned with Taleb’s and Hemenway’s worldview. I didn’t expect this to be the case; I’m not sure there’s a whole lot in professional background or personality that Taleb and Hemenway or, say, Rob Hopkins or Richard Heinberg have in common. My hope is that they have in their own ways all identified and captured something fundamental that manifests in all sorts of systems.

Small is Beautiful.

Taleb likes to talk about artisans. He argues that due to their small size, lack of dependency on complex global financial and business systems, artisans and small local businesses are the only variety that don’t and won’t implode spectacularly. As he puts it, “when the dust settles we’ll have more robust systems and more artisans.” This is of course quite in line with permaculturists like Hemenway suggesting we move away from grain monocultures (which, as he argues, contribute to hierarchical agricultural civilizations) and move towards small-scale gardening with polycultures.

In particular, Taleb’s argument is about the complexity of the financial system, and how its bigness and complexity are inherent problems. I agree, but in moving to the opposite extreme, I wonder if it’d be possible to achieve anti-fragility. For example, D. Radiodurans is about as robust as a life form can get. But I’m not sure it’s anti-fragile—it’s just too simple to benefit in any real way from stresses it experiences. (Is there a certain, maybe “right”, level of complexity required for anti-fragility?) In any case, Taleb argues that nature in general—the target of emulation in permaculture—is naturally anti-fragile and needs constant stresses and dynamism for its health. I think he’s making a case that our economic and social systems should be modeled after nature—permaculture for the economy (which I imagine many permaculturists would agree with).


Before one can reach for anti-fragile or regenerative systems, it seems building resilience is required. In complex systems, Taleb contends it’s not possible to have resilience unless the participants have skin in the game—that we need to move away from a financial system that’s publicly subsidized, privately profitable. I’m reminded of an idea Greer suggested inThe Wealth of Nature that corporations should have the downsides of personhood as well as the upsides, and thus face the equivalent of jail time for crimes they commit.

Taleb argues against the development of utopian systems, and instead suggests robustness to defects and errors, even in human behavior—for example, greed-proof systems, or ones that even benefit from the greed of individuals rather than, as today, suffer from it. (Is strategyproofness a small-scale example of this?) He rants a bit, as he is wont to do, about how prediction is a bad approach to problem solving for systems that are social or economic in nature (whereas they work in systems that are physical in nature). This makes me wonder: where does the Limits to Growth fall? Is it modeling the world as an ecosystem that follows certain known patterns, or is it modeling a socio-economic system? It seems to be a bit of both.  Thus instead of avoiding shocks and enduring low-level stress—the economic analogue to fire suppression—we should embrace shocks. Shocks expose weaknesses without weakening whereas chronic stress is the opposite, as is the temporary / artificial suppression of negatives; the approach reminds me of annealing.

More than just shocks, we should accept and embrace non-linearity of negative effects. Taleb gives an example of traffic non-linearity—a small increase in the number of cars on the road can hugely affect the traffic experienced (something true with network traffic as well). (Regarding responses to such situations I’m reminded of Braess’s paradox, which arises due to a suboptimal Nash equilibrium in, say, a freeway system; in certain situations, adding roadway capacity can decrease the throughput, which may be a partial explanation of the value of freeway metering lights.) He gives a similar example regarding the size of banks and the stress tests that are applied to them, and echoes the idea that too big to fail is too big to exist.

So it seems that, following this reasoning, we should identify some set of plausible Black Swans and then become robust to them. How do we determine what is plausible? Taleb makes the case that physical systems are ones where models work and thus we shouldn’t be worrying about whether the sun will rise, but this needs more refining. One goal is to first decrease fragility, and a way to do that is to mitigate the impact of volatility and randomness. Buffers are one general technique to that end, and I imagine there are a number of others. An approach to this, which is akin to Adam’s explanation for the name Contraposition on our About page, is to accept that we are going to shed parts of our economic and social systems as we decline, and make it possible to shear them off without affecting the functioning of the overall system—the Black Knightwrit large. Once our systems are resilient (though not sustainable), we can reach for some measure of anti-fragility through approaches such as permaculture.

Finally, when it comes to political systems, Taleb makes a case against large nation states and for confederations like Switzerland: “mistakes are made small and things aggregate up without the mistakes.” Not having a background in political theory, I’m not sure I have much to say on this, except to say that massively distributed direct democracy is something that has appealed to me for a long time. Only a few years ago I learned how numerous towns in New England are still governed bytown meeting; it seems to me that such communities, like Switzerland, will be well served by these established systems of local direct democracy in the years ahead.

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