Tag Archives: Economics

SKYNET: The Perfect Economist?

“If A Machine, A Terminator, Can Learn The Value Of Human Life, Maybe We Can, Too.” – Sarah Connor

Pictured: Central Bank Chairs of Earth, United States, China, and Nigeria (clockwise)

By William A. Foster, IV

I know that any commentary involving Skynet evokes an absolute sense of dystopia, but perhaps what it was given control of was more the problem than giving it control. Instead of giving it control over our weapons of mass destruction, we instead gave it control over our systems of resources that usually lead to the use of those weapons. The chief economist of the Earth’s resources. What is economics though? There seems to be what we as economist know it to be, there is what those outside of the world of economics believe it to be, and unfortunately those two often are a world apart. According to the American Economic Association, “Economics can be defined in a few different ways. It’s the study of scarcity, the study of how people use resources and respond to incentives, or the study of decision-making. It often involves topics like wealth and finance, but it’s not all about money. Economics is a broad discipline that helps us understand historical trends, interpret today’s headlines, and make predictions about the coming years.” To put it a bit more bluntly, economics explores the use of resources – and everything is a resource. How teachers use their time is a resource, the availability of insurance is a resource, what happens when there are subsidies for renewable energy is a resource, so on and so forth. Economics constantly is exploring what happens when resources interact with each other and the people and/or organizations that use them. Does a child with 24 questions in kindergarten show greater innovation as they get older versus one with 12 is a question an economist can ponder. However, the fundamental question at the very heart that economics is constantly trying to answer is efficiency of the use of any resource.

Again, the questions. How do we ensure we waste less food? How do we ensure more people have access to livable capital? Economists are constantly trying to find the perfect recipe to ensure that answers optimal efficiency toward outcomes. As humans have evolved so have our economic systems. In fact, I have often argued that our economic systems should be viewed in a more biological context. They evolve as our needs, wants, and desires evolve. The humans of today have very different NWDs than those of 1,000 years ago or 10,000 years ago and therefore the economic (resource) systems by which we use to meet those NWDs also has evolved. At one point in time we used a barter system, a land system, and now a capital system. Each in an effort to loosely improve the efficiency of obtaining the resources for NWDs of humanity. No system is perfect and no system is pure. Although most of the world currently operates on capitalism, it is different from country to country due to other variables that underpin human behavior like culture, government, and more. There are also intertwines of systems mixed into each other. Taxes by their very nature are an agreed upon socialism. They are an agreed upon use of things the society needs and the burden is bore by the entire society. Things like government, police, and fire are all sourced through taxes and are socialist in nature. Pure economic systems are virtually impossible to achieve all because of one variable – human behavior. Behaviors like sexism, racism, and almost any exclusionary -ism makes the reality for pure capitalism impossible because -isms are an act of socialism. As much as economists like myself study trends and incentives one thing is for sure, human behavior will at some point throw you for a loop like an amusement park roller coaster – with no safety feature.

There are 195 recognized countries in the world, according to the United Nations with approximately 8 billion people, 10,000 distinct religions, endless geographies that influence behavior, and so much more. To say that at any point in time an economic model could be upended is putting it kindly. This makes structuring the efficiency of global resources a crude science at best for economics. Historically, those with the strongest militaries have often dominated whatever economic system was in place. Sometimes it is also the luck of geography. The United States of America, Saudi Arabia, and Russia happened to be countries formed on top of arguably the world’s largest oil holdings. Oil is quite literally a fossil fuel that forms from the remains of dead organisms over millions and millions of years. The sheer luck of this being important to humanity is impossible to model. How do you model luck in the distribution of global resources? Because of dead organisms dying potentially in concentration in these three geographies millions of years ago, today the humans that sit upon their dirt enjoy an advantageous standard of living that others simply do not. How then do we ensure the resources of the Earth that 8 billion people who comprise millions of different factions and fight over either physically or through policy have an equitable access to? The pessimist in me does not believe it is possible because power is the one constant through every social, economic, or political system that drives at the very heart of our behavior. However, economically Star Trek’s science-fiction world (Trekonomics: The Economics of Star Trek) says there is a possibility. And while it is based on a world that exist post-scarcity perhaps a world of post-scarcity is not what we need. The expansion into space may offer us a post-scarcity world where resources are abundant, but the problem is not abundancy as much as it is control. There is abundance of a lot of resources already on Earth that could be viewed through such a lens where at the very least the needs of every human would be met, but control of those resources makes them behave in a scarcity dynamic. Therefore, the only real solution is to remove the human decision making-ish.

Enter, Skynet. Just for a brief reminder of why Skynet brings dystopian fears to anyone familiar with it, “Skynet was originally intended to coordinate unmanned military hardware for the U.S. government and was given power over the military and its weapons.” Skynet, is the antagonist in the Terminator franchise that seeks to destroy humanity after it becomes self-aware. In the franchise, Skynet is described as “an artificial neural network-based conscious group mind and artificial general superintelligence system” or as the Terminator character Kyle Reese describes, “new… powerful… hooked into everything, trusted to run it all.” The essence of its creation was to give the U.S. military the ability to have a system that could run every model, see every possibility, and act accordingly before their enemies. Therein lies the economics rub.

Hello, Skynetomics. A program and system that would be independent of all human decision making, would be responsible for any and every resource needed for an efficient distribution of said resources, and would create a baseline human existence. Gone would be arguments over equitable distribution of water, education, income, and more. Skynetomics would decide who gets what and how much. Everyone and everything would be on a resource allowance that would usher in a new global standard of living floor – not ceiling. Ushered out the luck of being born on the right piece of dirt at the right place and time. That your great-great-great-great grandfather thousands of years ago was the head of the right clan and now you are the heir to the throne of England would potentially be a thing of the past. The ceiling of what one does with that allowance would still be up to them, but generations would no longer be born behind or ahead theoretically. Humans no longer responsible for how to obtain the resources of survival are now setup to test the infinite possibilities of their potential.

The problem of this is like everything else as it relates to economics – the human variable. Creating the system without the input of a proper representation of the world would be simply putting a nuclear weapon into the hand of whoever designed and implemented it. Computer programming suffers infinite biases like everything else in the world does despite what the technocrats would have us believe. Meritocracy and unbiased it is not. We see this with the obtuse percentage of women who are programmers or how scanners often do not recognize darker skin tones. Who would be designing Skynetomics would be as important as the program itself. We are a species built on power and control (like so many other species despite our hubris in thinking otherwise) so the development of a system that removes it may actually be beyond our capacity since rarely do any of us know our biases. Humans after all most primal and infinite resource may actually be the desire to control other humans.

HBCU Money™ Turns 11 Years Old

By William A. Foster, IV

“The happiness of your life depends upon the quality of your thoughts: therefore, guard accordingly, and take care that you entertain no notions unsuitable to virtue and reasonable nature.” – Marcus Aurelius

As we embark on our 11th year here at HBCU Money, we are not slowing down with the work we have before us. Our desire to continue to be a strong monetary and fiscal voice for the HBCU community is ever present. Covering the HBCUpreneurs who are growing amazing businesses, the business schools who are shaping tomorrow’s African American private sector leadership, HBCU economists who become the first to ever sit on the Federal Reserve board, and so much more. Our community has a voice and stories that need to be told, discussions that need to be broaden, and the hard questions that need to be asked. We have been there for it all and will continue to be there for years to come.

Thank you to everyone who has been there since the beginning and who has come to rely and trust that quality will always come first. In this day where sensationalism seems to be ruling over substance, HBCU Money and sibling blogs will continue to stand firm that there are those who desire and want to have their intelligence valued. That thinking beyond the headlines has not become a lost art.

Holding true to the saying, it is a marathon and not a sprint.

HBCU Money™ Turns 9 Years Old

By William A. Foster, IV

“I still believe that if your aim is to change the world, journalism is a more immediate short-term weapon.” – Tom Stoppard

It is hard to believe that it has been nine years since HBCU Money was founded. It began with a conversation with Jarrett Carter, Sr., founder of HBCU Digest, about the lack of economics, finance, and investment information from an African American and African Diaspora perspective. He simply said, why do you not start one then. Challenge accepted and a challenge it has been. HBCU Alumni Owned media across the spectrum continues to fight to be a real and present voice in the ever changing landscape of media. Both trying to push the old guard forward and try to keep up with the competition and outsiders that seeks to control and own our narrative. They often seeing the value of our content, but with wretched intentions. This has and continues to be one of our great fights.

To be a voice of a community is an immense responsibility. Holding decisions makers accountable, helping inform the community in an unbiased manner, and yes, at times shaping the conversation. Sometimes it has been the duty of HBCU Alumni Owned media to present thoughts and visions that are ambitious and bold into the conversation about what is possible. It is a gentle balance that must be minded.

Going forward I will continue to help build HBCU Money, HBCU Politics, and our other media assets to be a formidable force for empowerment for the HBCU community and Diaspora. This I believe to be part of my life’s work. I am thankful for those who continue to fight along side me and for us.

HBCU Money™ Business Book Feature – The New Confessions of an Economic Hit Man

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Featuring 15 explosive new chapters, this expanded edition of Perkins’s classic bestseller brings the story of economic hit men (EHMs) up to date and, chillingly, home to the US. Over 40 percent of the book is new, including chapters identifying today’s EHMs and a detailed chronology extensively documenting EHM activity since the first edition was published in 2004.

Former economic hit man John Perkins shares new details about the ways he and others cheated countries around the globe out of trillions of dollars. Then he reveals how the deadly EHM cancer he helped create has spread far more widely and deeply than ever in the US and everywhere else—to become the dominant system of business, government, and society today. Finally, he gives an insider view of what we each can do to change it.

Economic hit men are the shock troops of what Perkins calls the corporatocracy, a vast network of corporations, banks, colluding governments, and the rich and powerful people tied to them. If the EHMs can’t maintain the corrupt status quo through nonviolent coercion, the jackal assassins swoop in. The heart of this book is a completely new section, over 100 pages long, that exposes the fact that all the EHM and jackal tools—false economics, false promises, threats, bribes, extortion, debt, deception, coups, assassinations, unbridled military power—are used around the world today exponentially more than during the era Perkins exposed over a decade ago.

The material in this new section ranges from the Seychelles, Honduras, Ecuador, and Libya to Turkey, Western Europe, Vietnam, China, and, in perhaps the most unexpected and sinister development, the United States, where the new EHMs—bankers, lobbyists, corporate executives, and others—“con governments and the public into submitting to policies that make the rich richer and the poor poorer.”

But as dark as the story gets, this reformed EHM also provides hope. Perkins offers a detailed list of specific actions each of us can take to transform what he calls a failing Death Economy.

The Finance & Tech Week In Review – 1/7/17

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Every Saturday the HBCU Money staff picks ten articles they were intrigued by and think you will enjoy for some weekend reading impacting finance and tech.

Mozambique’s poverty reduction was only half as fast as what Sub-Saharan Africa achieved.@WBPubs wrld.bg/fGUH307nxky

Is economics education failing?@wef wef.ch/2hXUMa2

These are the values shared by the most innovative companies@wef wef.ch/2i5cXKr

Climate change and growth risks@nberpubs bit.ly/2iZxJZh

Faster and cheaper than Concorde, meet the next-generation supersonic passenger jet@wef wef.ch/2jbYf0R

Your walk could be a password that connects devices on your body@newscientist ow.ly/6XK2307MkQn

Dell’s new laptop leaves the power cord in the past@nwtls ow.ly/vaj8307MkGZ

This robot can beat you at chess, then serve you coffee@CIOonline ow.ly/Xhph307Mkwc

Scar-free wound healing could be on its way@nwtls ow.ly/iNLh307Mks7

Baltimore Bike Share Arrives With 40% Electric Fleet@cleantechnica  ow.ly/GCKt307Mkjs