Instead of a total economic collapse

In his book: Reinventing collapse : the Soviet example and American prospects, Dmitry Orlov suggests that the planned economy of the USSR was in far better shape to endure its collapse than the market economy of the U.S. can be prepared for its own undoing. He makes a convincing argument so long as we think inside the box of existing economies. In brief, here is the argument he lays out:

1. Lots of Soviet citizens live in public housing with "free rent". Only one third of US homes are owned outright. Two thirds of US "homeowners" can be evicted by defaulting on their mortgages. All can be evicted for failure to pay property taxes levied on their homes.
2. Most food sold in Russian stores is the result of planned production by the government that does not account for making a profit or losing money. Most food sold in American stores is delivered by rival enterprises in a global capitalistic system that depends on profitability and private investment to stay in business.
3. Most travel within urban centers in Russia relies on public transportation with government access to fuel supplies. Most travel in the US from the suburban sprawl to urban employment relies on private automobiles that become immobilized during gasoline shortages.
4. Soviet students who want to continue their studies through college can do so for free or very little expense. American students go into massive debt to personally finance the cost of soaring tuition rates and exorbitant college expenses.
5. Russians benefit from "free" public services for health care, social services, trash collection and prison operations. US citizens deal with an increasing number of privatized hospitals, social services, trash collection companies and prison operation enterprises -- that can all go out of business and suspend services.
6. Soviet citizens get news and entertainment from state owned media outlets. Americans get their news and entertainment from advertising support media outlets that need audience share to attract revenue and robust economies for companies to afford to advertise.
7. Russians have become accustomed to shortages of commodity goods which has taught them to stockpile essentials. US citizens rely on the stores, warehouses, trucking firms and suppliers to keep every shelf well stocked.

Extrapolating from Dmitry Orlov's argument, it's easy to imagine a nightmare scenario for the US. Evicted homeowners will be wandering suburban streets, sleeping in vacated homes, evading the over-taxed police and falling into substance abuse, suicide and crime. Cars will be abandoned wherever they ran out of gas. Trash will get piled high at the curb. Stores will have half empty shelves and shoppers will be unable to eat well or at all. Radio and TV will go off the air. Newspapers and magazines will suspend publications. Colleges will close their doors. Privatized governmental services, operating in the red, will release their patients, inmates and dependent clientele onto the public.

For this scenario to play out, several resources, safety nets and initiatives need to get counted out:

• The quantity and quality of innovations, creativity, user-generated content, and online collaborations in the past decade.
• The groundswell of initiatives, outreach and activism recently enjoyed to bring about Obama's election, Web 2.0 spaces and numerous crowdsourced resources
• The volume of digital communications between cellphones, PDA's and computers
• The potential nationalization of banks, broadband internet access, and privatized governmental services

When I consider the implications of all this potential for resurgence, the nightmare scenario seems unlikely to me. Rather, I expect to see a new, collaborative, compassionate, comprehensive economy emerge from the fall of the artificial economy.

Down the slippery slope

I'm expecting the next economy to fill in the gaps as the current economy fails to rebound from the recession. The next economy will be much more sustainable and resilient than it's predecessor. So much of the current economy is centralized and efficient, it's very prone to sliding down the slippery slope. The next economy is distributed, loosely coupled, and paced for humans with fascinating lives to keep in balance.

In A Demon of Our Own Design, Richard Bookstaber gives a superb analysis of the difficulties in regulating hedge funds or investment banks. He explores the comparison to the meltdown of a nuclear power plant or the explosion of oxygen cylinders on an aircraft in flight. The rapid failure occurs because there are no timeouts, buffers, delays, circuit breakers or due process protocols. Crash-prone systems are tightly coupled. One thing leads to the next in rapid sequence. The attempt to dampen the effect or slow the flameout only adds to the spiraling problem.

A similar pattern of collapse is described by Fred Pearce in With Speed and Violence: Why Scientists Fear Tipping Points in Climate Change. Our planet regulates the climate to maintain temperate regions for long periods of time. Yet throughout the archaeological record, there is evidence of numerous ice ages. The self-regulating dynamics take out each other like a row of dominoes or a house of cards. Changes in atmospheric temperature melts glaciers which alters the salt/fresh water balance, which ultimately reverses the flow of the Atlantic ocean current. Instead of bringing warm currents up from the Caribbean, the ocean brings cold down from the Arctic. The atmosphere and oceans are tightly coupled.

Enterprises are much more prone to collapse when they drop one or more of the balls I described yesterday. Their devotion to short term gains, quarterly earnings and stockholder intentions sacrifices more than quality, customer satisfaction and employee initiatives - it kills the goose that lays the golden eggs.

The next economy will not have the incentives or financial pressures to scale beyond local enterprises. Our new ability to link up, keep up date and coordinate events online suggests we will experience the best of both: distributed nodes and connectivity. It will be well understood that enterprises contribute to their locations and face consequences when they neglect their neighbors. It will also make economic sense to focus on local markets as the cost of transporting and importing soar once oil prices reflect the irreversible decline in reserves.

The anatomy of self restraint

Without self-restraint, any enterprise overdoes it. Business as usual is excessive about everything in it's short term interest and neglectful of everything else. It cannot stop itself, slow down or question it's over-zealous ambitions. Two recent books make this pattern perfectly clear:

• A Demon of Our Own Design - Markets, Hedge Funds, and the Perils of Financial Innovation / Richard Bookstaber
• The Ascent of Money - A Financial History of the World / Niall Ferguson

The current mess in the US of Wall Street, consumer lending, and business borrowing -- has been a long time in the making. It's the result of standard operating procedures in the financial markets and institutions. It's not a problem with a solution. It's a culture, mode of operation and way that business gets done. It will go on like this until it's abandoned, superseded and obsolesced. The next economy I'm anticipating will do that very nicely.

When any enterprise exhibits admirable self restraint, it keeps four balls in the air:

• The bottom line, financial viability of current risk taking, and ratios that indicate how well the invested capital is performing
• The quality of the products and services offered, the metrics that indicate how good, reliable, valuable and consistent the offerings remain
• The perceptions of the customers and the resulting changes in reputation, brand image, loyalty, and word of mouth advertising
• The experiences of employees who can identify problems, expose incompetence, recommend changes and commit to improvements

All of these four balls function as restraints. They serve to question what is being done to excess, the real reasons for any dogged pursuit. They propose changes that would satisfy more of the other concerns. They raise considerations of balance between ambitions and expose those endeavors which have been blown out of proportion. Rather than rely on top down authority figures who are usually part of the problem, they call upon all eyes and ears to keep the enterprise from going to extremes or off in the wrong direction.

Enterprises that make money from money (not products, customer service or on-site assistance) routinely drop three out of these four balls. They become addicted to their own short term gains, quarterly earnings, and reduced risks combined with greater returns. They quickly become over-extended, over-committed and over-invested. They repeatedly get caught in crises of liquidity and spiraling downturns of asset valuation. To put a positive spin on their addiction, they over-sell what they're doing and over-reward those who stay on message. Meanwhile they shoot the messengers who pick up any of the other three balls and run with them. They cannot handle insightful initiatives, cautions and better ideas that jeopardize their single-minded devotion. They end up being a big disappointment to their loyal investors, customers, employees and legislators who trusted them. They create enough enemies and skeptics to end their reign in a hurry.

With the downturn of a global financial system resembling this pattern, the imminent emergence of the next economy seems even more likely to me.

Getting off artificial stimulants

The portion of the world's economy that's falling into a recession is a pandemic contrivance of human foibles. Its economic principles are ill conceived and not built to last. We've been fooled by it enough to buy what it sold, work within it's organizations, invest in its promised returns and bail it out with tax dollars when it faltered. But none of our trust in it has transformed it into something viable. It's doomed and we get to pay a price for misreading its pretenses. Here's how the failing economy is unreal and unsustainable:

1. Offers artificial value: We consume useless stuff en masse. Do you have items in boxes or cupboards that you've forgot about? How full is your attic, garage, basement and/or storage locker? How much did you get out of from what you read, watched, heard and did yesterday? Your answers are an indication of how much artificial value you've been consuming. Artificial value is forgettable. It lacks depth, significance and and relatedness. It gets compared to junk food because it's lacking in its version of nutritional value and substance.
2. Thrives on artificial scarcities: "Only two left in stock". "On sale through Tuesday". "Available for a limited time only". Fueling a buying frenzy keeps the rabid consumers from questioning whether the value is real to them. The artificial shortage of supply raises the price the market will bear and the quantity being demanded. Shopping becomes an act of desperation that ends up with buyer remorse.
3. Makes artificial progress: We make bogus progress when we push against something that pushes back. We can kid ourselves where getting ahead while we push a rubber band or pendulum to it's limit. We become deluded by our obvious advancement when we're actually making a problem worse, fueling an effort that will backfire and getting hooked by a vicious cycle. No amount of time and money spent will reverse the futility of our efforts. We started from a false premise that pushing will work for us and end up with the results of "what we resist persists".
4. Sustains artificial growth: Our individual and collective wealth grows artificially when we "cast off negative externalities" We rob Peter to pay Paul and kill the goose that kills the golden egg. We borrow from the future to fund our present excesses. We postpone our meeting with destiny over the dumping, depleting or poisoning we've done without regard to the long term and big picture. We kid ourselves that we're getting away with murder as if systemic justice will never come along.
5. Requires artificial stimulants: This juggernaut cannot be financed on retained earnings. It needs more than "pay as you go" and "live within your means" to survive. It requires artificial stimulants called debt, credit, liquidity, leverage, borrowing, financing, investor capital or advances. It's in a big hurry to over spend because its time is short, its fate is doomed and it's overdoing everything imaginable before it tanks.
6. Creates artificial prosperity: An artificial economy appears very healthy when the poor get poorer, the middle class shrinks and the gap between rich and poor widens. The prosperity appear elitist and aristocratic to those whose rights have been violated. The society weakens and social capital erodes. Goodwill turns to apathy, envy and revenge. Everyone watches their back and guards against solicitations for cooperation. Smiles seem fake and pleasantries feel artificial.
7. Protects artificial barriers: The commons gets chopped up into contrived turfs and territories. Market spaces get bounded by barriers to entry. Walled gardens become protection rackets with goons to guard the gates. Property rights become abusive to human rights. Monopoly protections take precedence over protecting the environment, community and local economy. The privileges of shareholders dictate what must be endured by stakeholders. The advantages of the few become a burden to the many.

These artifices won't be around much longer. Our challenge is not to get rid of them or hasten their demise. We simply need to get off of them before they take us down with their false premises and toxic effects.

Rebounding with resilience

When a solid table gets bumped, the house of cards on the table collapses. The table remains sturdy and unaffected by the fast and furious downfall of the flimsy arrangements. The cards are then on the table. The truth comes out about the false pretenses, deceptions and delusional ambitions. Faith in the false constructs gets destroyed by the shocking violations of trust, commitment and integrity. People are then left to their own devices, resourcefulness and connections. The next economy rises from the solid table that was only shaken slightly when the house of cards came tumbling down.

I've recently read to other books that have helped me see the robust potential for our economic recovery and renewal:

• Upside of Down - Catastrophe, Creativity and the Renewal of Civilization / Thomas Homer-Dixon
• Eating Fossil Fuels - Oil, Food and the Coming Crisis in Agriculture / Dale Allen Pfeiffer

I'm not expecting any financial bailouts to work that merely re-inflate the credit bubble, excessive spending or corporate globalization ambitions. The resurgence of prosperity will come about from the underlying potential for innovation, communities of practice and crowdsourced resources. The next economy will resemble the ways Barak Obama got elected and the Web 2.0 spaces have blossomed with user-generated content. There are good reasons to expect us to rebound in these ways.

When a forest is on the brink of collapse, it's potential for recovery can be found in the soil and outside invaders. The forest has become an overly efficient, rigid, tight-coupled, closed system. It lacks variety, redundancy and flexibility. The forest has morphed into a control freak that demands conformity, not creativity, innovation and deviance. It needs to be disrupted by novelty in the soil and outsiders ready to exploit new niches as they become available. The forest gets saved by a partial collapse that opens the closed system. The disruption may come from a lightening strike, drought or insect blight. The "ruined" bare spots create opportunities for new growth, participants and inter-dependencies. The ecosystem restores the loose coupling, redundancy and diversity which makes for sustainable resilience.

When the USSR collapsed, Cuba lost its financial subsidies and oil supply. Yet rather than imitate North Korea's agricultural system breakdown, Cuba realigned itself from it's toxic dependency on foreign aid and oil. Urban gardens sprang up in great numbers. Lots of food did not need to be transported at all, and some, only short distances. The use of pesticides and fertilizers was eliminated by permaculture farming methods. The diet of Cuban citizens was enhanced by the home-grown foodstuffs which improved their health also. The government intervened to protect the small farmers as opportunities appeared to maliciously exploit temporary scarcities, vulnerabilities and dependence on others. The levels of mutual aid, cooperation and inter-dependence greatly increased to everyone's benefit. A green revolution emerged from a groundswell of initiatives, like an edible YouTube or Wikipedia.

I'm expecting the next economy to deliver more than local food. I'm foreseeing the next generation service economy to be less reliant on borrowed money and customers with big incomes. The table is more solid than chasing after big bucks. There will be many more social entrepreneurs living by simple means and cooperative arrangements. We'll each be making a living looking out for each other with online support.

Patterns of economic collapse

I've recently discovered some consistent patterns throughout history that explain how economies collapse. Two books in particular have been very helpful for putting our current recession into a historical context:

• Bad Money: Reckless Finance, Failed Politics, and the Global Crisis of American Capitalism by Kevin Phillips
• The Great Wave: Price Revolutions and the Rhythm of History by David Hackett Fischer

Governments, religions and corporations are all tempted to expand beyond their means of sustainability. They become over-extended by over-reaching their practical limitations. They become over-bearing to those who are getting subjugated, manipulated and coerced. Human rights of everyone get over-ruled by property rights of the elite. World domination becomes the objective of the over-zealous endeavor. While the expansion succeeds, the market for goods, services and financing expands dramatically. Profitability and prosperity abounds. The beneficiaries get deluded into thinking they are on the right track with no end in sight. For example:

• The Roman empire extending as far as Gaul until Egyptian papyrus exporters cut off shipments and left the Roman government unable to communicate with outlying regions.
• Inca and Aztec empires covering meso American until small bands of Spanish conquistadors captured their kings and incapacitated the citizens.
• The Catholic Church maintaining a vast empire of monasteries throughout medieval Europe until the printing of bibles in vernacular languages undermined their absolute authority.
• The Hapsburg empire, Maritime Belgium, and Imperial Great Britain maintaining colonies until their over-expansion on borrowed money collapsed their financial system.

As these domineering endeavors become over-extended, their collapse becomes imminent. They lose resilience as they become rigid, obsessed and self-righteous. They make enemies and lose allies. They alienate their loyal subjects who previously submitted to being over-ruled. They become over-dependent on a single source of sustenance, control, authority or exclusivity that can be cut off by a small act of aggression. They rely too much on credit, finance and patronage as their weakening economy generates less tax revenue and middle class prosperity. Prices then soar and real income then declines for hard-working wage earners. The gap widens between rich and poor. Democratic processes become more aristocratic, exploitative and manipulative of powerlessness.

The resemblance to our current globalization and financial system is haunting. Fortunately there are also patterns for rebounding and resilience that I'll explore next.

Tracking geek migrations

Geeks flock to places of technological sophistication combined with practical innovations. They do not feed off places of basic research and the practice of pure science. Their pragmatic nature craves solving immediate problems with technological wizardry.

When geeks migrate from one place to another, they are giving us a sign of the next economy. Their read of the economic landscape tells them to move on and change how they are valuable. They transform themselves more easily than other professionals because their expertise is continually in flux. Life long learning is inherent in their chosen endeavor. It's their nature to stay ahead of the curve and get back there quickly if they fall behind it.

I got to thinking about geek migrations for the first time last month when I read: The Big Switch: Rewiring the World, from Edison to Google by Nicholas Carr. Back when the only motive power for factories was moving water, production facilities had to be located next to rivers and waterfalls. There were geeks of the day who designed, installed, troubleshooted and repaired water wheel "millwork". The sophistication of the gears, drive shafts and seals were beyond the skillset of the miller or weaver. As steam engines became available, factories got built away from rivers, but close to canals or railroad lines for shipping their production output. A new generation of geeks then came on the scene who fiddled with the new intricacies of steam engines and transmission systems through the factories. When electric motors entered production processes, the central power sources were eliminated along with the geeks who had kept them functioning. A new breed attended to the motors by each work station inside the factory and the generation of direct current electricity for the entire the factory. As the generation of electricity became consolidated by the inventions of AC power, high voltage transmission systems and enormous dynamos, yet another genre of geeks capitalized on those opportunities. But, in that last phase, it no longer took geeks to operate the workstations or to plug into the power outlet. The access and functionality became ubiquitous and pedestrian.

Nicholas Carr is suggesting the same pattern is being followed in the evolution of data processing. When there we're only mainframe computers, it took geeks to invent them, manufacture and service them. The large corporations, agencies and institutions needed geeks on their payroll to operate their mainframes on site. The advent of mini computers spawned a need breed who sat at a workstation all day generating CADD drawings, computer animations or other output from specialized application software. The PC broadened the applications and lowered the technological requirements to use them. Geeks migrated to IT Departments and software development firms. The current evolution of cloud computing replacing IT Departments suggests that geeks will soon be on the move again.

Another book I read last month shed even more light on the migration of geeks: Once You're Lucky, Twice You're Good: The Rebirth of Silicon Valley and the Rise of Web 2.0 by Sarah Lacy. Industry observers who date back before the dot.com collapse see patterns in the innovation. Startups are like breeding grounds for geeks to mingle, cross fertilize ideas and bring out the best in each other. The sophistication and refinements in their designs, interfaces, and coding makes the technologically sophisticated product/offering operate efficiently. The upgrade path involves few elaborate contortions and gyrations. All these fertile interactions persist until a fateful moment. The startup either goes public with an IPO, gets bought by a conglomerate or brings in some "executive talent" to manage the operations. In any case, the creative talent evacuates immediately. The geeks migrate to the next generation of startups.

So compared to the economic indicators I cautioned against using yesterday, geek migrations is a potentially far better indication of the next economy.

Beware of economic indicators

Economic indicators are designed by data analysts for data analysts. They create an echo chamber of self confirming evidence. They load up the analysts minds with answers more often than serving up better questions. Those who rely on the economic indicators "drink the Kool Aid" that takes out the cult of analysis in a hurry. When stock markets, housing prices, sales or employment goes into a steep decline, no one is cautious about the poisonous nature of economic indicators.

The biggest problem I have with indicators is their insularity. They only monitor the same old roller coaster. They measure the ups and downs, speed of the rise and descent and turning points. They presume there is no place to go other than up and down. These numbers sometimes translate into economic expansion and contraction, but persist in the use of a convergent data set. There's changes in how many can fit on the ride of the same old roller coaster. They don't consider the viewpoint of roller coaster designers, constructors and demolition experts.

I'm fascinated by disruptive innovations, game changers and market upheavals. Economic indicators don't reveal how the data analysts are getting misled, tunnel visioned or trapped by their own assumptions. The data showing an economic downturn does not reveal innovations that are ready to burst on the scene. Indicators of tight money do not necessitate shortages of creativity, freedom of expression and social capital. Established industries in trouble is no indication of customers who are on the brink of getting more value, access, freedom and opportunities. Layoffs from employers with a long standing track record says nothing about job opportunities in startups on a totally different track.

Economic indicators watch for how much trouble were in, how dangerous things are getting and what to get apprehensive about. They are based on fear which stifles our creativity, curiosity, compassion and transformations. The indicators cannot see beyond the dangerous ground which defines the data as reliable measures, forecasts and pattern recognition. The cognitive strategies of the left brain invoked by the danger preempts what the right brain can do in this situation.

I'm also fascinated by circularity and self reference. Data analysts presume they are being objective. The data "speaks for itself". They presume there is no value in counting themselves in or referencing themselves in their analysis. They act as if their data grounded in fear will have no effect. Yet, fears do come true as they inspire herds to "follow that butt in their face without question". Minds freeze like "deer in headlights".

Fears then motivate us to drive by monitoring the rear view mirror. Rather than realize "there's nothing to fear but fear itself", their fears dictate conformity, compliance and convictions. A bend in the road is the end of the road because the turn shows up in the rear view mirror to late to make it round the bend. Beware of economic indicators.

The next economy

It's tough to get a good read on the next economy that's emerging from our current global recession. I'm here to help. So much is changing, it's difficult to make out what's a blip on the radar and what's a significant trend. There are no easy answers or foregone conclusions to call upon. There are better questions to be asking and innovative alternatives to be considering. This next series of posts will share how I'm getting a read on the changing economy that puts my mind at ease.

When we're faced with any crisis, it's easy to get caught up in it and lose our perspective. Crises tempt us to become agitated and apprehensive. We don't see any alternative but to freak out and over-react. We lose our head and make problems for ourselves and others. We derail our inherent ability to respond resourcefully and develop robust solutions.

When the US Air flight from La Guardia lost both it's engines, the pilot got a very good read on the crisis. The cockpit crew saw how to land the plane in the Hudson River that resulted in no fatalities or serious injuries. My sister knew the Captain, C. B. Sullenberger, when he flew for Continental Airlines three decades ago. He's always had a reputation as a "good stick" who has a great feel for how to handle an aircraft without relying on the avionics. He's got the right stuff to keep his cool and have that effect his cockpit crew when others could easily panic. He's since taught so many other pilots the nuances of crises, his on familiar ground when all hell is breaking loose. He can keep a clear mind because he's cultivated his grasp of staggering uncertainties.

In times like these, we all need our minds to function like Captain Sully's does. We need to get a good read on the next economy and how to become part of it. We ought to realize, as soon as possible, how to be part of the solution and drop out of feeding the problems. We need to be asking different questions, applying different distinctions and considering different scenarios.

Educating for the next economy

When I'm feeling indignant, I make pronouncements like "it's higher ed's moral obligation to prepare their students for employment twenty years hence!". When I'm feeling cynical, I make proclamations like "institutions for higher learning cannot not learn enough about changes in our current culture, markets and business models to prepare students for next week, much less twenty years out". When I'm feeling compassionate, I relate to how it feels being trapped inside the flawed business models and legacy practices of academia. Here's some empathy for those who are hamstrung and prevented from educating their enrollment for the next economy.

There are four mindsets that reject the next economy out of hand:

1. Educators schooled in a tradition of objective science, empirical verification and accurate researched conclusions will prepare students for the next economy once it's past history. Until then, announcements about the next economy amount to unverified speculation, wild conjectures and unfounded hypotheses.
2. Educators organized by bureaucratic hierarchies get rewarded for their personal conformity. It pays to toe the line, meet other's expectations and comply with policy mandates. Speaking of the next economy now is tantamount to whistle blowing, traitorous conduct and sticking one's neck out unnecessarily.
3. Educators committed to publishing their research look through a lens of authoritative expertise transmitted by read-only, ink on paper. It's inconceivable how naive newbies could speak with authority and legitimized voices. It makes no sense how read/write text could not plagiarize, corrupt or ruin their carefully constructed publications.
4. Educators enamored with factory models of education (delivering consistent content, ensuring quality of presentations, maintaining uniformity of service) can only dread the next economy. There's nothing to look forward to about becoming inconsistent, sporadic, dependent on inexperience, or plagued by participation.

In most educational settings, these mindsets are prevalent. They set the tone, define expectations and determine who gets respected. Rewards and abuses get dished out according to these parameters. Pressures to think alike about success, function as a team player and maintain unity of command would impose these restrictions on independent thinkers.

There are educators who are feeling inspired, seeing the changes, valuing the opportunities and welcome the challenges of the next economy. They want to educate their students for the next economy. They would be hitting walls, getting shot down, kept overworked and disheartened by snide comments.

These forerunners are in no position to supplement a free educational experience with some advertising revenue. They cannot crowdsource what they are offering or allow a community to provide the educational experiences among themselves. They cannot formulate educational offerings which are inherently viral and successful without marketing expense.

At least not yet...

Research universities may live on

Last weekend I finished reading Closing the innovation gap : reigniting the spark of creativity in a global economy by Judy Estrin. She reveals an ecosystem in the U.S. for innovation that functioned superbly in the seventies. Since then there have been changes in government policies affecting intellectual property rights for innovations developed with tax dollars as well as policies impacting immigration of scientific talent from other countries. Large research facilities like Bell Labs, Stanford Research Institute, and IBM's research facility have cut back the basic research that led to eventual applications. The exchanges between corporations, universities, the military and these labs no longer prove to be as beneficial for all of them, as well as our society.

Tuesday, the New York Times ran a feature article titled: "At M.I.T., Large Lectures Are Going the Way of the Blackboard". There were 74 comments added when I read it online yesterday. The article described the $1.25 million dollar classroom for teaching introductory physics with the TEAL system (Technology Enhanced Active Learning). Numerous students who are currently enrolled at M.I.T. criticized the system and the changes brought about to improve attendance, participation and responsiveness. Older graduates extolled the virtues of lecture formats that were lost by the migration to the TEAL system. Educators from other institutions described how the benefits purchased for millions of dollars by M.I.T. can be better achieved with smaller class sizes and personal interactions with the students.

As I pondered the book on innovation and the comments on the article about hi-tech classrooms, I got the impression that traditional colleges are designed to deliver science educations exclusively. They prepare students for research positions in labs, corporations or universities. The exposure to faculty researchers provides great examples for students to emulate, conduct to imitate and contexts to nurture conformist ambitions. The use of what I consider to be "antiquated teaching methods" for students who will work with people, social problems or human systems, function very well when assimilating a technical discipline. The success of research universities at preparing new scientists can then feed into the ecosystem of thriving innovation.

With alumni, students and faculty all opposing "desirable" changes in classroom formats, perhaps universities will remain as they are while they shrink dramatically. They could continue to do what they accomplish very well and lose out on the outcomes they fail at consistently like:

• preparation for employment or entrepreneurship in the next economy
• rite of passage into adulthood
• cultivation of emotional intelligence and creativity
• assimilation of Web 2.0 technologies

Disruptive innovations could then deliver these outcomes better, cheaper and more efficiently without "attacking the incumbent in their stronghold". The "cuckoo clocks" can avoid design changes while digital clocks invade the market.

Professional educators under scrutiny

I've been a professional educator for most of my life. Acting professorial rubbed me the wrong way most of the time. While I was in the profession, it was in the dark about the source of my unsettled feelings. From my new vantage and breadth of new perspectives, I can see clearly what's been troubling me.

• Most professional educators operate inside a consensus reality that calls for professing expertise. There is a superstitious belief that learning happens in the presence of professors professing their advanced knowledge. This conjecture is not evidence based, empirically verified or even supported by anecdotal evidence.
• Many professional educators create experiences premised on coping with an elusive understanding. If it was assumed that if understanding came easily, they would be "out of business". By making it seem difficult to understand, there is lots of material to cover, explanations to offer and concepts to comprehend. Never mind that it's easy to grasp if one starts from that premise and cuts to the chase.
• Lots of professional educators act out getting chronically misunderstood. In academia, they do not get understood by their administration, faculty senate, dean, department head, colleagues or students. It appears they have already made up their mind that getting understood never happens or is never likely.
• Most professional educators exhibit a low tolerance of the moody, irrational and impulsive dimensions of our psyches. It seems imperative to maintain tight control over emotions. The overuse of rational argument and logical discourse speaks volumes about their lack of feeling, personal freedom and chaotic variety in their experiences.
• Many professional educators appear to giving us the wrong impression. It's professionally acceptable to say one thing and do another. There are no professional scruples to earn the respect of students by their credible conduct or to expect people will learn more from how their taught than what was covered.
• Lots of professional educators cannot describe their students as having anything in common with themselves. The students are de-personalized, distanced and devoid of feelings in their interactions with the professional authority. The learners are obviously ignorant, inferior and disqualified from conversing as colleagues, authorities or experts.
• Most professional educators operate inside silos of professional exclusivity, specialization and precision. Their disciplines do not overlap, share insights or find value across the boundaries of their well-defended turf.
• Many professional educators feel at home at academic conferences presenting papers among their compatible colleagues. They feel abandoned, isolated or confronted inside own classrooms. Their anxiety levels are chronically toxic for anyone coming in contact with them.
• Lots of professional educators function as tradition-bound incumbents who squelch sustaining and disruptive innovations. They teach the way they were taught and cover what's in the book. They see the need to do things the way they were done before rather than question the function, value, side effects and personal statement that consistency makes.

Most professional educators cannot assemble a list like this. Like myself in the dark, the misgivings are inarticulate and difficult to frame. Most persist with great determination and suffer bouts of burnout. Different questions to not come to mind to consider abandoning the premises of professional educators.

The electrification of college educations

Colleges are already electrified in the literal sense. Colleges operate in that literal sense. Institutions of higher education get that they have access to and make use of electricity. They assume they are not in the dark about changes outside their institutions because they work by electric light and plug their computers into electric outlets. They are on the grid and getting fed with the latest updates which must mean they are keeping up with the changing times.

To operate in the literal sense, we take things as they appear. The facts are the facts. The evidence speaks for itself. We can deal with what appears to us objectively, as if we're not messing around with our empirical observations. We assume there's nothing going on between us and what's out apparently there to distort our impressions. There's no need to count us in or join the circuity while runs through us to what we observe. We can categorize what we see accurately and be done with "it".

When we operate in the literal sense, we are spellbound by ink on paper and industrial mechanisms. We think our thinking is reliable while it's undermining everything in sight. We don't get this Web 2.0 thing or the strange surge of altruism it evokes. We don't know what to do with being subscribed to beyond doing our thing and getting feedback. We don't see that online offerings keep the industrialized, literal sense of educating on life support. We don't get the more subtle effects of electrification that are coming into full realization amidst this global recession.

Colleges in the literal sense will persist unaltered for a much smaller percentage of the population than currently enrolls in degree programs. College will continue to be useful for the R&D crowd that needs to be brought up to speed in complex, technical disciplines. Colleges will continue to be subsidized to advance a cutting edge of science and develop multi-disciplinary synergies. Colleges will inevitably breed more academicians who will continue creating more conceptual, abstract and philosophical knowledge. Colleges will seem like AM radios, pendulum clocks, land line phones, printed pages, file cabinets and movie theaters -- still here even though times have changed.

In the meantime:

• Professions will be obsolesced and replaced by extraordinary collegiality among open business models.
  
• Professional educations will no longer prepare students for contexts with no need for credentials and tremendous opportunities for contribution.
• The rite of passage into adulthood that colleges currently bungle will be offered at less expense during shorter intensives.
  
• Authentic communities will provide with much better experiences, outcomes and repercussions for all participants of transitions, and socialization experiences.
  
• The vain attempts at benign dictatorships overseeing advertising-supported, "free" social spaces on the web will be superseded by egalitarian, direct democracies forums.
• The dissemination of free tools for creating, editing, collaborating, scheduling, contacting, publishing and broadcasting will be extended into instructional designing, tutoring, teaming, and counseling.
• A mash-up of peers and volunteers will yield superior educational outcomes to anything that can be accomplished by textbook, tests and grading.
  

Getting a higher education will become electrified for those who get what effects digitization is having on everything in sight in the figurative sense.

Learning formats in 2020

In preparation for an upcoming conference, Geetha Krishnan has asked us: "what kind of learning formats will be in vogue in the year 2020, specifically with respect to corporate training?" I'm delighted he's experimenting with crowdsourcing his forecast. You may want to help him out with your foresight too. His request proved to be a juicy question for me to consider that resulted in this large outpouring of predictions:

Continued dismantling of bundled media - Just as record albums are now sold as individual songs and large portions of print newspapers are available online at no charge, training programs will get unbundled too. Rather than taking entire courses through formal procedures of enrollment, learning will be offered buffet style. "Take what we want and leave the rest for later or never". The "sit-down seven-course prepared dinner" will become a luxury item only affordable by an elite minority. Just-in time, extremely focused, performance-support will be far more common than just-in-case, broad scope, advance preparations for future responsibilities.

Proliferation of different versions - Just as iTunes offers 10 million songs to download, training in 2020 will be nuanced for oodles of different use cases, applications, levels of expertise, and previous skill developments. On iTunes, some of my favorite songs are available as an original recording, a later studio production, several live concert recordings, an acoustic version, a duet with the original performer and cover versions by other artists. An online search for "fire prevention skills" in 2020 may likewise yield a list of modules for fire marshals, building superintendents, renters, office workers, factory team members, and home owners. Those many versions will also be differentiated by type of construction: high rise, low rise, campuses of separate structures, malls of connected buildings, steel and glass construction, concrete, wood frame, etc. There might even be different versions for taking preventive measures yourself, getting immediate acquaintances to change behaviors, or influencing large populations to prevent fires.

Start-up cost reduction: The costs have plummeted to provide in-store custom eyeglasses or film processing in one hour. Costs have also plunged to start radio stations, ecommerce sites and Web 2.0 platforms. The virtualization of front and back end IT Department services on cloud computing platforms is making it much cheaper to offer lots of free space to users, to scale rapidly and to accommodate expansions or contractions in traffic volume. This suggests that the horde of creative individuals currently uploading videos onto YouTube and coding widgets for Facebook could transition themselves to create revenue-producing, educational offerings. This "long tail" of niche providers will likely formulate fascinating training games, narrative interactions, simulations and immersive scenarios by the zillions.

Convergence of laptops, PDAs and cellphones: Thin clients logged into online SaaS (software as a service) sites will proliferate as cloud computing becomes more prevalent. The need will recede for individual hard drives loaded with software, archived files and personal preferences. The personal interface with the ubiquitous cloud computing environment will be as streamlined as a Wii controller that senses location and movement. Training will be available everywhere all the time at the touch of our fingertips. What we hold in our hands to get trained will be a combination of our current mobile devices.

Consumer reaction to online losses: Cyberspace has made it too easy to speculate on financial gains and suffer staggering losses, as evidenced by the dot.com bust of 2000 and the current global recession. It's also become much easier to lose privacy, be hounded by past misdeeds, get spammed, experience identity theft, become addicted to online games, fall prey to predators, shop for non-essentials excessively and jeopardize employment prospects. All this suggests that most people will back off from the current level of indiscriminate Internet usage and become more selective in the future. I suspect this revulsion from the dangers will also yield a resurgence of F2F contacts, community involvement, and collaborative presence in physical situations. More training will occur in person with online support.

Smart grid distribution networks: It's becoming possible to live "off the grid" and sell excess power from personal solar or wind generation hardware back to the electric utility. I suspect the current wave of crowdsourced content being uploaded, shared, contributed and collaborated on -- is only the first generation. By 2020, this voluminous outpouring will have evolved into a wonderful combination of DIY and DIT training experiences. The self directed efforts envisioned as PLE's (Personal Learning Environments) will be complimented by collaborative efforts among many together. This next generation of generosity will balance self sufficiency with taking and giving back to the community grid. Training will become more social, exploratory, open-ended and unstructured. The results will provide higher quality, more lasting effects and increased momentum going into the next gathering.

Ready or not, here comes the future of corporate training!

Getting the difference completely

The field of epistemology studies how we know whatever we know. A flawed epistemology yields our thinking that we're in the know when we don't know half of it yet. For instance, we know we're different from the other person but not how to get that difference completely. As far as we can tell, it only takes one to come up with what we know and that someone is outside ourselves. "They got it bad and that ain't good".

Our world is filled with teachers, trainers and instructors who know of many differences between them and their students. Their descriptions of students usually point out those differences objectively. The learners may be obviously less smart, knowledgeable, informed, experienced, confident, motivated, or creative. The observed difference characterizes a polarity between haves and have-nots or superiority and inferiority. The teachers are in power-over students getting over-powered. This is only half the difference or a single circuit that lacks another frame of reference. There appears to be no way the evidence-based description of the student contains numerous self-references and reciprocal arrangements. It's inconceivable that it "takes one in the same to know the other one at all" or "it takes two to tango" like this.

An epistemology is complete when it comes full circle. Closing the loop on an objectively identified distinction explores its reversal and context. When someone appears less smart, we know who's smarter than that. We then consider an opposite distinction where being less smart is better than being smarter. That might include situations where:

• being too smart for our own good says there's one right answer and we're the one who's right
• being right is not effective because it frames others as wrong or deficient in some way
• being smarter comes across as condescending, arrogant and offensive
• being less smart appears vulnerable, accessible and authentic
• being less smart relates well to others who also feel put down by holier-than-thou types
• being less smart is a sign of continual learning and openness to disconcerting alternatives

When the distinction and it's reversal both seem valid, knowing is no longer about the distinction. The complete understanding depends on the situation. The distinction is context-dependent. The applying the distinction also sends a message, conveys an impression and sets up an ongoing relationship. It's a wonder how the distinction will apply: in forward or reverse formation. The mystery of the moment undoes feeling over-confident, exclusively in-the-know, or rigid about only applying the distinction to others.

Seeing double

The concept of "double descriptions" that I explored yesterday was conceived by Gregory Bateson decades ago. He identified two patterns of entanglement between people which he labeled complementary and symmetrical relationships. In both patterns of entanglement, a single point of view misses what is happening. It takes two to see the one cycle.

Bateson compared the use of double descriptions to binocular vision. When we see with only one eye, we have no depth perception. We crash into things we expected were further away. With both eyes open, we navigate through space adeptly. We see the opportunity to count ourselves in the circuitry that ties us together. We experience depth perception in relationship with others.

In complimentary relationships, one member unconsciously offsets the other by going to the opposite extreme. The relationship is kept in balance by compensating for each other. A motor mouth will partner with a very good listener. A bully will seek continued interactions with a doormat. An analytical brainiac values the companionship of a passionate animal.

In symmetrical relationships, the two participants go round and round without resolution or conscious awareness of their mutual torment. They have too much in common to get along or to resolve their differences. They are essentially thrown for a loop by a mirror. The ways they pester each other escalates their misunderstandings and tensions between them. It appears they are boxing their own shadow or screaming at their mirror image. They provoke each other to endlessly try harder, fight longer and struggle with more determination.

The dynamics of cheating I explored recently embodies both kinds of entanglements. Some cheating displays fluidity, spontaneity and opportunism -- which is compensating for the other's rigidity and unresponsiveness that ends up doing everything by the book. Some other cheating is symmetrical -- giving the other a taste of their own medicine after getting cheated out of what they expected, paid for and deserved.

In both cases, neither participant sees what is going on. Double descriptions are not being practiced. Each merely reacts to the other's reactions unconsciously. Each point of view misses out on being closely tied to the other. Neither gets that it's going round in endless circles.

When each participant can describe both the other viewpoint and their own, problems get resolved. Shared understanding replaces the isolated contentions. The exclusive frames of reference become inclusive, accommodating and compatible.

Practicing double descriptions

Every situation can be seen two ways. We can practice making double descriptions in many different ways. We can:

• describe the thing we're observing and lens we're looking through to see it
• speak of the content and the context we bring to that content
• address it and our way of relating to it, embodying it or grounding it in our experience
• say what we have to say and where we're coming from to say that
• pay attention to something outside us and to our basis for pay attention on the inside of us
• make a thing of what we are seeing and of the process it is going through
• mention the obvious node in a system and the hidden cycle that ties us to it coming and going

Double descriptions like these make us effective. We effect others in a good way. We not only see things objectively, but subjectively as if we filter our perceptions and attributions of the exchange. We describe our bringing personal feelings, needs, histories and biases into our observations. We stop pretending to be unbiased, detached and unaffected by what we're seeing. We count ourselves in the situation we're describing.

When people describe us both ways, we feel understood by them and touched by their understanding of themselves. It seems like they have empathy for us and them too. Their sensitivity to our situation and theirs move us. They are showing consideration of our condition separate from them and in common with them. It appears to us that we're both getting pictured accurately in their minds, not labeled, framed unfairly or misinterpreted.

In the midst of these double descriptions, we become cooperative. We want to help out and understand others in return. Social capital abounds as we reciprocate responsibly and benefit from our generosity. We also see others both ways and effect them in a similar manner. The spill-over effects from these exchanges benefit everyone touched by the interconnections.

In lieu of getting taught

What's so bad about getting taught? We don't learn from getting taught like we learn from most every other immediate experience. So much gets dislocated when we're getting taught. It's amazing we can stay awake and pretend to pay attention.

Getting taught is not the same as getting answers to our questions. Getting taught is different from getting search results, resources we're looking for or books that may help us with our inquiry. Getting taught is getting told what to think, being given one right answer or getting fed some simplification to swallow hook, line and sinker.

When we're getting taught, it does not matter if we have a question. The instructing barrels ahead whether or not the timing is good, it works for us or it fits our situation. It's not about us, relating to us, being useful to us or helping us out in some way. We're not really there when we're getting taught. It's one of those "I - it" deals where we're the "it".

When the person, whose giving us the experience of getting taught, can describe us even slightly -- everything changes. They get us in some way. They picture us with some accuracy. They may give us the feeling of being understood, respected or validated in some regard. They create a context where we can count ourselves in and partake in the exchanges. We're suddenly really there like a somebody that makes a difference. Our status as an "insignificant nobody" has been "canceled until further notice". Being there is no longer about "getting taught".

Our own learning processes kick in when we've been described in some way. We're doing those inner things like: finding it out for ourselves, figuring out the way it works for us and coming to our own realizations about it. It's all about relating to it, tying it in and connecting between this and that -- rather than what we're getting taught. The content becomes incidental to what's going on with us. We describe ourselves differently as students. We change what we think learning is about and how it happens. We look engaged and act motivated like we're really curious or something. We make it easy for the instructor to describe us as we act like the learning is about us in the first place.

Count ourselves in

The best way to really learn something is to teach it. The worst way to learn something is to get taught it. In between teaching it and getting taught it is: finding it out for ourselves, figuring out the way it works and coming to our own realizations about it.

Teaching obviously has an effect on the other person getting taught. When we realize how that effect comes back around to bite us in the butt or congratulate us on the back, we're careful what we put out there. We become wise to the ways that learning happens without making it happen. We see how to really learn something by teaching it (and writing about it, explaining it, or making it clear to others like I'm doing right now).

We learn more from how we're taught than what we're taught. If we're shown respect while getting taught, we respect the person teaching us and the content we're expected to learn. If we're abused, disrespected, misunderstood or framed in a bad light, we get that message loud and clear. We show no respect to the instructor, give no credibility to the content and no patience to the process of getting it to sink in. We return what's been dished out to us.

When we teach like we're constantly sending subliminal messages, we see what we're saying without any words. We perceive the students signaling us in the same light. We come from a place that sets a good example, provides credible leadership and says what we stand for. We expect to be understood for how we conducted ourselves and the ways we treated the students.

When we describe students like we're one in the same, we point fingers back at ourselves. It "takes one to know one" and "anything about you applies to me too". Our description of a students says a lot about ourselves and where we're coming from. We join in the cycle of mutual regard and representation. We get framed by our framing the students. We count ourselves in to the mirroring and reflecting that goes round and round.

Making mistaken impressions

It's easy to get the wrong impression about this "mirror thing". We're inclined to take the analogy literally rather than symbolically. We get no use out of it. We fail to apply what we see to reflect on how we're seeing them. We assume the mirror image means we're exactly the same as they appear to us.

When we see someone is ugly, that does not mean we're ugly too. It means we're using an ugly way of seeing them. We're not operating in a second loop where there are many ways to see what we see. It reflects on us that we would choose such an ugly approach to recognizing how they appear to us. We expect nothing to be revealed to us deeper than surface appearances. We reveal to others that we take things at face value where appearances are devoid of significance. Things don't symbolize anything to us. A fact is fact and there's no two ways about it.

When we see students as lazy, that does not signify that we're lazy in the same way. It means we're too lazy to learn more about those "lazy" students. We don't have clue why they're acting lazy, how they get provoked, tempted or forced to lack ambition. We're taking a laid back approach to inquiring, investigating or rethinking what we're seeing. We not challenging ourselves to develop a loop where there are many different ways to see appearances.

When we get the impression that a student is unimpressive, we're operating under a mistaken impression. We're too easily impressed by initial impressions. How we get impressed by others is equally unimpressive. We don't change our impressions easily or upgrade the one's we formed early on. We give off the impression that we don't expect to make much of an impression on people. We have not reflected enough on our mistaken impressions to impress people with how we see them.