Monday, 13 December 2010

How to grow a nation

An ecosystem is a network of all physical and biological factors in a particular area that takes on a certain describable form. Within an area it is the total of both the biological community and the physical environment. There is a great deal going on in any one ecosystem, huge amounts of feedback and dynamic change. Yet, there is no general overarching control scheme and the systems settle in seemingly well defined and fairly predictable states (a coral reef for example looks kind of the same across the world).

A nation is much like an ecosystem, they grow, develop and mature, have flows, connections and exchanges, continually vary in all sorts of ways. A good nation has stability, health, happiness and individual freedom. We wouldn't say a nation was working well if it was extremely chaotic, with populations of people dying all the time or huge economic booms and busts. Equally we wouldn't really say a nation was running well if it needed constant top down control, if every part of it was being described explicitly. This wouldn't be a group of cooperating (and competing) individuals with a common identity so much a machine obeying a fixed set of rules.

Ecosystems achieve stable states due to the properties of limited connectedness and redundancy. If I am a fish in a coral reef I rarely just eat one thing at one time, I also coexist with a few other fish that help me (cleaning my gills, helping me avoid predators etc) and I am preyed upon by a range of different fish. As a coral reef fish I have a wide range of immediate connections. Yet, these are immediate, if we go a few steps up the food chain to a big shark, the effect of a population of one species of fish most likely will have little effect on the shark (but not always). The shark also has many prey, needs his gills cleaned and the competition with other big sharks is fierce. At each stage the impacts of the loss or gain of any one species are spread out, thus they do not contaminate the system.

Our economic system is similar, but different in one key way, it has a unitary value. Everything can be transformed into $$$$. This means that there is no limited connectedness, I can sell my mothers wedding ring to buy food and drugs, and the drugs can be traded for guns etc. If the big banking crash should tell us anything it is that our economic systems are too connected, the breakdown of one part spreads like a plague to everything else.

The essential flaw in the banking system is a lack of redundancy, in a ecosystem or there are lots of critters doing very similar jobs. When one fails another can step in to pick up the slack (not that it is doing this consciously), equally if something dies it only effects a limited area as other species can simply feed on something else. The value of components in a ecosystem are strongly non linear, or to phrase it another way they matter more to some than to others. To an immediate predator a prey is worth a great deal, to a competitor they are worth a different (and negative) amount and to a primary producer they may not be worth very much at all (if anything it is through weakly diffuse interactions with other species). Money does not work like this. My £5 is worth the same to a banker as to an aid worker. I can shop around to get the best deal, but so can any sane person. The transferable nature of currency breaks down the steps of the ecosystem and links everything together much more closely.

This is why foreign aid, where huge sums of money are invested in a nation fails. I cannot build a nation with all of its strong flows, connexions and dynamics by converting it to one unitary value and attempting to dump it in. This would be the same as attempting to make a coral reef more productive by dumping billions of tonnes of nitrogen fertiliser into the sea. I call this the zombie approach to development:

'Nitrogen make plants grow, make system better!'

'Money make business grow and people happy, make system better!'

Unsurprisingly the zombie approach remains very close to the American modus operandi in Afghanistan. $52 billion dollars has been invested and people are calling it a remarkable failure. The method of investment has been the failure, the US works mainly with private development funds. These corporate entities engage in large scale projects disconnected to the local people. These types of projects are most vulnerable to corruption or even honest misuse by the people they are supposed to help. Why take tractor that has been bought for you when I can sell it to buy food. The unitary value of money allows all these schemes to be exchanged on the ground for short term wealth gain, often for a few individuals. Then the limited feedback and connections formed means that this process is unreported or ignored.

The US actively ignores NGOs in development because they are small scale and 'too idealistic'. These are exactly the qualities that development needs! The scale must be small so that local connections are formed, the formation of real connections through passionate idealistic individuals results in the creation of of non linear value (this isn't just a well, this is OUR village well and it is important!) this means that things wont just be converted into guns and drugs. This is the building of a society, an ecological society where the exchanges and connections between people and the world are of real value. This is why we have failed to rebuild a nation.

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