Robert Paterson's Weblog

A measure of why we are F**ked

The system is rigged to divert our wealth into the "Casino" - why do anything worthwhile if you can make money by playing the game?

More here

This is also a huge driver of the health epidemic - More here

So what to do?

Disconnect yourself as much as possible from the system which is run as part of the game. For instance look at how the health system itself is run in America:

"Mercy Hospital is owned by an organization under the umbrella of the Catholic Church called Sisters of Mercy. Its mission, as described in its latest filing with the IRS as a tax-exempt charity, is “to carry out the healing ministry of Jesus by promoting health and wellness.” With a chain of 31 hospitals and 300 clinics across the Midwest, Sisters of Mercy uses a bill-collection firm based in Topeka, Kans., called Berlin-Wheeler Inc. Suits against Mercy patients are on file in courts across Oklahoma listing Berlin-Wheeler as the plaintiff. According to its most recent tax return, the Oklahoma City unit of the Sisters of Mercy hospital chain collected $337 million in revenue for the fiscal year ending June 30, 2011. It had an operating profit of $34 million. And that was after paying 10 executives more than $300,000 each, including $784,000 to a regional president and $438,000 to the hospital president.

That report doesn’t cover the executives overseeing the chain, called Mercy Health, of which Mercy in Oklahoma City is a part. The overall chain had $4.28 billion in revenue that year. Its hospital in Springfield, Mo. (pop. 160,660), had $880.7 million in revenue and an operating profit of $319 million, according to its federal filing. The incomes of the parent company’s executives appear on other IRS filings covering various interlocking Mercy nonprofit corporate entities. Mercy president and CEO Lynn Britton made $1,930,000, and an executive vice president, Myra Aubuchon, was paid $3.7 million, according to the Mercy filing. In all, seven Mercy Health executives were paid more than $1 million each. A note at the end of an Ernst & Young audit that is attached to Mercy’s IRS filing reported that the chain provided charity care worth 3.2% of its revenue in the previous year. However, the auditors state that the value of that care is based on the charges on all the bills, not the actual cost to Mercy of providing those services — in other words, the chargemaster value. Assuming that Mercy’s actual costs are a tenth of these chargemaster values — they’re probably less — all of this charity care actually cost Mercy about three-tenths of 1% of its revenue, or about $13 million out of $4.28 billion."

Read more: http://healthland.time.com/2013/02/20/bitter-pill-why-medical-bills-are-killing-us/#ixzz2LpNHXe6u

If you play in the system, you will be squeezed - it is how it all works today.

Related articles

What will replace the Job? The Networked Artisan!

Anti Biotics and Farming

Spain - If you are young - No Jobs - What about here soon?

My nephew Tristan is just back from a trip to Spain. It's worse there on the ground than we hear on the media. No one can see a way back to the old days. Here are some perspectives. As I read read Tristan's words, I wondered what was coming here. Is this stage part of our own future? What chance do our young have here at home?

"I spoke to one Spaniard on my flight, who in his late 20s, and who said that of the four men in his family, his father, himself and his two brothers, only he had a job. He added that his job was actually in London and that he worked as a waiter in a restaurant in London for 3 weeks per month and then came home for a few days.  He said that in his small village of 1,500 people he would be exaggerating if he claimed that 100 people had a job.  Of those that had a job, many would work for the police or the army and a large number would work for the government....."

"The question that people in Spain ask themselves is where will the new jobs come from?  With jobs there is income, with income there are taxes, with taxes the government can provide services and pay off its interest payments and debt.  With no jobs there is nothing."

I think that Spain and Greece are the harbingers what is to come. The final stage of the old economy shuts us all out of the game. I don't see either a reform or a way back.

But I do see an alternative. A much better life. A life we can all chose now. You Don't Need a Job is here on Amazon

Jobs and Bacon show the way - Choose your future

What future will you choose? Will you chose to stay in the machine world and so increase your investment in it? Have you given up? Or do you choose a different world and are you making this new reality your own?

I see that the signs are that we had better consider choice #3 soon. I see clear signs that more investment in the old world is a very bad idea. 

Let's start with Bacon.

I have just got back from a visit to my local farmer's market where I chatted with my pork person about what is going on with pork. She had been in the machine model. She had 350 sows and sold the piglets on in the big system. But her 350 sow operation was too small. Even combined with her cousin with another 250 sows, they were too small. They could make a major expansion, fold or do somethng different.

She chose the radical different. She now has less than 30 sows. She sells direct and locally. Now she makes money rather than loses it all the time. But she too might have to be even more radical. If she is to survive at all and you and I will have any bacon.

Only huge scale works in the machine world. Machine meat depends on corn and soy. Which in turn depend on oil and water. This year's drought has driven up corn prices from $200 a ton to nearly $400. There is talk of corn at $800 a ton if we have drought next year. First of all this means that all the huge operators who have been at the scale demanded by the machine system, are now cooked. They have no moves in this scenario. They cannot find any alternatives at this scale. Their fixed costs are so high that their cash flow cannot survive another year like this. They will have to fold.

My local pork person has a chance though. She has her own market and buyers who are personally connected and she has rock bottom operating costs. She might also be able to hook into new food supplies such as the waste stream from local restaurants and households. This is how pigs always fed. She also has the room to change her breeds to pigs such as Berkshire, who can live outside all winter and also forage better. 

She has still choices and room. The Big Pig Operator has none. She also will be still here to take advantage of higher prices. For when all the pigs in the system have been killed, there will be a shortage. Bacon will be scarce.

I see a pattern here with Jobs in large institutions.

Scale is the issue here too. To play at the high end in business you have to be a giant now. With being giant comes giant fixed costs. But the entire enterprise also depends on cheap oil and  other cheap inputs. Any disruption to these inputs and the cash flow kills the operation. When you are at that scale, you only can shed labour and hope.

So the smart giants will continue to hire in cheaper markets and replace labour with technology. The well paying jobs in North America and Europe cannot come back. They are gone forever. And when the crisis in inputs takes place, as with corn for meat, then they will have to fail.

What will be left are the small operators like my pork person. There is no safety in a Job Job. There is no safety in the huge organization. 

After the crash has settled, will the old system comes back? Will it be smart in an ever more uncertain world with risks attached to water and energy to rebuild a machine system based on the hope of secure key inputs? I doubt it.

Every year that passes, the key inputs to modern life become more fragile. Water, oil, topsoil are all at risk. And so is the underlying human capital. For a while, many seem just lost and incapable. But I also see signs that many are also taking their lives into their own hands and starting, like the pork person, to operate an economic model that works for them.

Smart people are dramatically reducing their own fixed costs and so attachment to the machine system. Just like the Pork Person. They too are making their own stuff and selling it directly. They too are investigating how to use their network to help them do better.

So this then is why the pork person is such an important story. She had to make the choice - scale up - fold - or change radically.

We all have a choice though like the Pork Person. We can stay in the old game and increase our investment in it. We can just give up. Or we can try the new model. We can rely on them or on ourselves.

The stakes are high. Time is short. 

I expand on this in my new book - You Don't Need a Job - which I plan to launch next week on Amazon. Watch this space.

The end of ideology - the awakening

 

Nature is speaking through us - ideology has prevented us from being in touch with out nature and with nature. 

As Paul shows us - the reaction to ideology is emerging itself naturally. OWS is another part of this deep feeling. 

Why Banks as we have now ALWAYS get into trouble and what might work better

We have new media as a result of the network. The network and web is affecting all aspects of life. It will surely transform credit and banking too. Here is why and here is what might take banking as we know its place - a much older version of credit but now networked. This matches also the new BIG business - many very small networked to be large

The Economy - Banking and the Future - A Flight to Safety - The chickens are coming home to roost for the "full service bank". While the big banks may be too big to fail, the retail depositor is very nervous. Europe is on a knife edge. There is talk at a very high level about "Ring walling" the deposit side of banking.  We know how weak the US major banks are too. But I have no optimism that reform will be easy. But I do see the depositor looking for safety already. There is a lot of chatter about "maybe I should look to my credit union?". People are not stupid and know that there is a lot of uncertainty abut the big banks and little room now to support them. This I think is the environment that could offer Credit Unions a huge opportunity.

I think it is inevitable that we will see a flight to safety for depositors. This will be a long term flow as the major banks cannot get fixed fast and confidence always takes a long time to restore. 

Absorbing this flow of share will be a challenge though. Can Credit Unions scale without doing what the banks have done? How can they scale and still be rooted in community? How can Trust be maintained? Also how can Credit Unions serve the new market for the very small?

The Complex Nature of the Business World today - Our banks have fully adopted the machine or "Ford" model to cope with the Machine and Ford economy. This worked when we all played by the Ford rules. But here is the problem, Ford Banks" can only deal with the simple because they use machine rules. The Big banks like Big Business. It's easy to follow. They like "simple" like mortgages and credit cards - they are easy to follow.

What they cannot do easily is to get a handle on where most people and business is going today. That is the very small and personal business. This is very complex and being Complex, cannot be evaluated by simple rules

This new economy is based on networks of the very very small. It is emerging quickly and is ignored by banks as they are structured today. These enterprises are very human and so very complex. They don't have traditional assets. They don't operate in a simple linear way. The "rules" don't apply.

These new businesses also sell into a new market. A market that is based on the value of Trust. For a growing number of people no longer trust the offerings of the big. They want services and products that they can trust. Real soap - Real Food - Real anything. These businesses cannot scale traditionally and maintain their key advantage, trust. So they too have to learn how to scale using networks.

For many of us now know that the Big cannot make or offer Real.

Nor will they offer the jobs back. As the big get bigger, they have to shed labour. For in the machine model it is the only way to keep your ROI. You take the real out of your product and you replace your labour with a process of a cheaper source. There is no stopping this process. 

This is the future, just as the Ford Model was the future in 1905.

The Opportunity for the "New/Old Bank - Our banking system has evolved to match the Ford system. A new banking system will evolve to match the system that is itself emerging. 

We don't know how to evaluate this kind of tiny networked business by using the machine rules approach. But we did know how to do this in the past when we had local banking.

In 1900 most business was local and operated like this. They did not use the web to network but network they did. They used face to face locally. Banks developed extensive personal relationships not just with each person - as we talked about on the phone - but participated in the health of these local networks as well. Like a good gardener, they helped their local community get stronger

We used to know how to do this. But of course "it" does not scale if we use a machine/industrial model.

To meet the opportunity of the new market, we also have to discover how to scale this older process. How can we do this? We know that all natural systems are fractal. If we can design a tiny model based on network principles, we can have confidence that we can scale it.

The Pay Off - A Virtuous Cycle of Return - There is a systemic reason why Traditional Banks fail - There will be a systemic reason why a network model will prevent this Ford Banks end up taking on too much risk.One of the reasons why Banks take too much risk is that as they grow, the pressure on the ROI grows too. This is not corporate stupidity but an outcome of the design. In the model, the structural expenses grow in lockstep with assets. All resources have to be purchased. So when earnings get squeezed, they have to take more risk to keep up the ROI. By taking on riskier assets, they lower the threshold for default and so increase the future risk of pressure on earnings and capital. It's a vicious circle. For a while, this can be offset by scale. Hence more mergers. But in the end, there is no where to offset the risk and all the costs are locked in. Today all the big banks own too big a chunk of the risk. This is where we are in Europe. There is no where to run anymore.

But in a real network, most of the resources are attracted in for free. Look at Visa or Interac. If we use a real network, we can find ways of scaling that breaks this connection between structural costs and assets. In a real network, the resources and revenues scale exponentially while direct costs scale at a modest linear rate. Nearly all the value in a network is not on any members balance sheet. As the total network value scales, so each member gets more value. We can see this in staffing. Back in 1995 Visa had 3,000 employees and B of A had a 100,000. Visa did a vast multiple of transactions to B of A. B of A now has 300,000 employees and is laying off 30,000 in a vain attempt to get its costs in line with its revenues.

The OpportunityJust as the Ford Model replaced the local artisan model and was adopted by every organization, so the network will do the same in our own time. It's evolution!

Are you a freelancer? Lonely? Co-Working? Making a Living!

I read this in the Globe today.

But for a solo freelancer, it can be even more challenging to build your career when you don’t have an organization behind you. You’re responsible for your own networking and creating your own opportunities.

Freelance videographer Rosa Park misses having people to bounce ideas around with, so relies heavily on her social media for interaction.

“It’s kind of lonely not having co-workers,” says Ms. Park, who works out of a tiny downtown office. “I live on Facebook and Twitter. I try to cut it down, but I can’t. It’s the only way for me to be social.”

One of the benefits of Co-Working in a palce like the Queen Street Commons is that you get back into the tribal conditions that we all crave as humans but without the office politics!

Co-Working is exploding around the world as more and more of us work as freelancers and need to be socially connected.

Here is just North America

Here is the link to the world - there is even co working in Saudi Arabia!

At the Commons, as with other co working spaces, we offer a place where you can have a professional environment - meeting rooms etc - AND interact with others who may be in very different fields than you. It is a place to get help and fellowship as well as a good place to work and to meet outsiders.

But next month we are expanding this idea of a place only to a network that extends beyond the walls. 

Fellowship does not mean that we are always in the same place. It can often be the launch pad for a great quest. So what might be our great quest? Might it be to make to make the little meangingful? For who saved the world in LOR? It was a hobbit.

This is who we really are. 70% of business on PEI has less than 5 employees. What if we had a quest to make this powerful? What if we could make this the core of the economy? What if being small meant that you could make a great living? Who might then stay? Your kids? Who might then come? The kind of people who would fit PEI?

So this then is what we at the Queen Street Commons seek to do. We seek to be a catalyst for this kind of Fellowship. We will do our best to help you help yourself and those you care about make it possible to have your own "Living".

We want to make "making a living" the best way to live on PEI.

As with all quests, they start humbly with the kind of people that the Dark Lords laugh at. As with all quests, the power of the Dark Lords is real and immense. Tolkien wrote LOR as a response to the industrialization of the world. That is what we are up against.

But rather than rail against the system, why not build a new one? The Industrial system was strong in Tolkien's day - but it is so weak now. This is surely the time?

Every quest starts with a few people and has to start with a few steps. In the next month, I will tell you about what few steps we intend to take. I hope that you might like to join us.

We are the Lantern Bearers

Rosemary Sutcliff is my favourite author. Imprisoned in a shattered body, she wrote novels about loss hope and adventure in ancient times. Her most popular being about the time of the great transition as the Roman Empire fell. Her mind took her from her room to a wild place.

The Lantern Bearers is a book set as the last of the Legions leaves Britain for ever. Aquila deserts and lights the fire at the lighthouse as the ship and Rome leave. The book is about the loss of all he knew and his finding hope and a new life. Many of her books have this theme, not the least the Eagle of the IXth and my favourite - The Sword at Sunset - the greatest Arthur book you can read. In theory she wrote for young adults. If so aged 61 I am proud to be one. 

Here is my favourite quote - I feel that it speaks to our own time

‘I sometimes think that we stand at sunset … It may be that the night will close over us in the end, but I believe that morning will come again… We are the Lantern Bearers, my friend; for us to keep something burning, to carry what light we can forward into the darkness and the wind’

Gutenberg, Galileo and Luther - Portents of our own Time?

I wrote this for a book back in Feb 2005 - I think what I said then is even more relevant today than then - do you too?

Back to the Future - Going Home!

We are going back to the end of the Middle Ages. We journey back to the beginning of the time that gave birth to our own culture. We go back to Europe of the early 16^th century. We go back to the beginning of our own pattern. A great cultural system is in terminal decay and a new cultural system is being born.

Like now, this is a turbulent time. War has been constant. Plague has killed 25% of the people. A new world had just been discovered that is going to pump money into Europe and will pull adventurers away. Islam has just been driven out of Europe. There has been a tidal wave of social and religious unrest that has been crushed utterly by an invincible combination of a universal church and by Kings that are gaining in power.

More powerful than the sword of the King is the power of the media. 

The pulpit is the mass media. It is the only source of information for the mass of people. Literacy is confined to the Church. Books are rare and very expensive. They are written in Latin or Greek. Knowledge is locked up. Not only does the church control the processes of communication but it has a tight control on message as well. Its two main messages are that salvation is only possible if you give the church your total obedience and much of your worldly wealth. The other message is that God himself has appointed the temporal rulers over you. 

Then on October 31^st 1517 Martin Luther nails his 95 theses to the door of a church in Wittenberg. At the heart of these theses was a big idea. That people did not need an institution between them and God. 

A hundred years later, in 1633, the Inquisition convicts Galileo of heresy.  His crime was to use evidence to refute the dogma that the earth was the centre of the universe. 

These are powerful ideas. But when faced with all this power against them, to spread they needed a viral vector. With all this power lined up behind the establishment, open war would have been suicide. Only a virus could get though the immune system of the time.

The viral vector began humbly in Frankfurt, in 1455 at the Frankfurt Book Fair, 

In that year, Johann Gutenberg sells the first copies of his mass-produced German Language Bible.  He sells them for 300 florins each. This was the equivalent of approximately three years' wages for an average clerk. However it was significantly cheaper compared to a handwritten Bible, which could take a single monk 20 years to transcribe. The viral vector was out and the ideas that it carried could not be stopped! The lock on communications was broken. 

Who would have known then that a priest with a big idea, a man with a telescope and a man with a new communication tool would come together to shake the world?  

Who would have known then that the vast power of the universal church and of the divinely empowered monarchs would be soon challenged and be overthrown? Who would have known then that science would be born? Who would have known then that the individual would soon have greater power to communicate than the church or the King?

Can we see our own predicament in this light today? Is this not our pattern too? 

Is not our great problem that the great institutions of our time, government, healthcare, education, arts and entertainment, even business, no longer serve us but only themselves? 

Is not their organizational doctrine based on a dogma of control? Have they not divorced their world-view from observable reality? Is not this split from the laws of nature their dogma? Are they not prepared to fight to the death to preserve this dogma? Do we not see the entertainment industry as an Inquisition? Do we not see the IP industry as the agent of the controllers and not of the creative?

Is not the new “big idea” of our time to disintermediate the institutional middleman and to enable direct relationships? Are supermarkets eternal? Do we need factory universities to learn? Is our health dependent on a doctor? Is the news what we see on TV? 

Is this idea of going direct, the same for us as Luther’s big idea that man could talk directly to God?  Is not the new doctrine for organizations based on the observable working laws and designs of nature the same as Galileo’s observations?

Is not the enabling vector, a new type of communication device that is so simple and so inexpensive that it will give voice and hence power back to individuals and to their communities?  Did not the printing press give men back their voice in the 16th century? Was not pamphletting the blogging of their time? Was not a consequence of printing, mass literacy? Did the use of this new media topple the power of the old media system? Did it not change politics? Did it not push Alchemy aside and give birth to science? Why would we expect less of Social Software?

Are we not standing at the beginning of a new reformation? Has the wheel of history turned full circle?

When the police wake up and see - there is hope

 

"How can we live in a democracy when no one has a voice?" Each of us is part of the same existence - so if we hurt another we hurt ourselves" "We spend too much time cordoned off from nature - we are part of the same earth and world and if we get together we can change it - Life is meant to be simple - there is no need for stress - we need to get back to the harmony that we are all part of"

Some quotes

HT Charles 

What went wrong? Why are we in such trouble? Where do we go now?

How did we get here? And where can we work to get ourselves out of this jam? Our food system is the system that drives our society - how our food system evolved in the 20th century took us here - and how we work to change it will take us home.

Here is the chapter in my book The Fractal History of Mankind that shows us how our food system in the 20th century took us to this place.

It picks up after the American Revolution - when a new dream of a just society was enacted that really did offer liberty and freedom. We see how this liberty and freedom was lost by a new food system! When we understand THIS, then we are equipped to see what we have to do to find a better system.

So here is the Pattern of the world that is now dying around us - here is how the process began and here is how it ends.