Tuesday, January 31, 2012

home improvement, system D-style

This New York Times article offers a peep at an interesting and progressive program in New York. Rather than reporting unlicensed construction firms to the authorities, the Queens Economic Development Corporation is trying to help them out, teaching them the skills required to pass the licensing test for home improvement contractors given by the city's Department of Consumer Affairs. Interestingly, despite the size of the Chinese community in NYC and their involvement in real estate in many neighborhoods, the city only offers the 30-question multiple choice test in English, Spanish, Korean and Bengali.

This program is a great idea--giving previously illegal contractors a route to legality. But it also raises some issues about the licensing test. For instance, how important is it for contractors to know that, for jobs that cost less than $200, they don't need a license. Or that they must keep their contracts on file for 6 years. Or that they can't start work on a job until 3 days after they sign the contract. Should the test really be administrative--or should it check whether these contractors really know the city's building code? And, speaking of the code, why, for small residential jobs, is bamboo scaffolding, which Chinese contractors have used successfully for years, illegal in New York?

Monday, January 30, 2012

System D & the Super Bowl

Football is big business--but only one of the teams in this year's Super Bowl has its roots firmly in System D.

The New England Patriots and New York Giants are both massive enterprises. Indeed, Forbes Magazine's valuations for the Patriots and Giants show that they're the 3rd and 4th most valuable franchises in the league, worth $1.4 billion and $1.3 billion respectively. Forbes estimates that the Pats' 2010 EBITDA (earnings before interest, taxes, depreciation and amortization) was $42.9 million while Big Blue pulled in a cool $40.6 million.

But only the Giants still trace their roots directly to System D. Timothy James Mara, the grandfather of current president and CEO John K. Mara, bought the franchise when the National League of Professional Football Clubs expanded into New York in 1925. He paid $2,500.

Tim Mara knew a good deal when he saw one. How did he have such business acumen? Because he was a bookie. Mara placed his first bet when he was 12, and, when he left school a year later, started his illegal gambling operation. Four years before he bought the Giants, he expanded his bookmaking efforts to Belmont Park. There, on an average weekday, he handled bets amounting to between $10,000 and $15,000. On weekends and holidays, his book was worth as much as $30,000.

He took the cash from his System D activities and diversified into other businesses, including the Giants and a coal company. At the same time, however, he was found to be legally destitute. On paper, the Giants were owned by his two sons, while the coal firm was in the name of his wife and brother. As for his bookmaking concern? Mara swore that he was just the manager and had no actual financial interest in it. But, as A.J. Liebling wrote in an appreciative profile of the wily entrepreneur, "Tim's destitution does not interfere with his enjoyment of life. Daily he visits the various business enterprises in which he has no financial interest." And he lived in a pauper's palace--an eight-room apartment at 975 Park Ave.

Today, the Giants and the Patriots are both wildly profitable formal operations. But you know which team I'm rooting for.

(for more background on the founder of the New York Giants, read "Turf and Gridiron," by A.J. Liebling, which ran in The New Yorker on Sept. 18, 1937 and also appears in The Telephone Booth Indian, Liebling's classic compendium about all things System D in NYC.)

**And here's another reason to root for the Giants: one of Tim Mara's great granddaughters, the actress Rooney Mara (she stars in 'The Girl With the Dragon Tattoo') heads the board of the Uweza Foundation, which supports empowerment programs for children and families in Kibera, the largest mud hut community in Nairobi, Kenya.**

Sunday, January 29, 2012

talk about an unequal world

Here's a jarring juxtaposition. The heads of state gathered at the Masters of the Universe conference in Davos Switzerland (aka the World Economic Forum) are talking of allocating 22 billion euros to combat youth unemployment in Europe. By contrast, in a report late last year, Al Jazeera asked if Senegal -- the West African nation whose total GDP is less than half the amount the Europeans are discussing and where an economic analyst reports that "less than three per cent of the population" receives a formal salary every month while the rest rely on "informal revenue" -- was experiencing "an African renaissance."

Annie Diouf makes her money informally. She works in Sendaga, Dakar's largest market, selling fabrics. "I got started in this business, because earlier I worked for a company and with inflation and the global crisis companies started shutting down in Senegal and because I didn't think I would find a job, I decided to work in the informal sector of the economy," she says. The work is hard and involves spending long hours in the sun and rain, often with little to show for it. With little faith in the government to improve their lot, Diouf and a few of her colleagues have taken matters into their own hands."We got organised, we put together a women's association so we can stand by each other. We pool our profits together and give the money to one of the women on one day and she buys the material for her stall, the next day another woman goes out and does the same," Diouf explains.
This is not to minimize the pressure on Europe's young people. But self-starters will fare better in this chastened and debt-ridden world. Europe has some things it can learn from Senegal. Informal collectives can spark an economic renaissance.

Wednesday, January 25, 2012

Bookies of America, Beware!

Betting on the Super Bowl!? I'm shocked, I'm shocked.

The New York Times offers a peek into the scads of money at stake in the football game pitting the New York Giants vs. the New England Patriots. And a few tidbits on the World Series and the NCAA tourney.

But, hey, is all this gambling part of the informal economy or the formal? Are the big winners paying tax on those earnings?

Tuesday, January 24, 2012

how to ensure equitable development

The headline offers the answer: Informal Economy Ensures Equitable Development. This article, about Papua New Guinea, comes from InterPress Service. Here's an inspiring detail:

Bire Nikil moved to Port Moresby from Chimbu Province in the highlands to start a food garden several years ago. At Gordons Market, he is surrounded by five of his relatives who assist him with growing and selling kaukau (sweet potato), bananas, aibika (Pacific cabbage), pineapples, peanuts, watermelon, mangoes and coconuts, all transported in by public minibus. Nikil’s weekly income of K300 (142 dollars) supports 20-25 people, including relatives in Chimbu province.
I love Papua New Guinea's policy statement that the informal economy constitutes "the grassroots expression" of the private sector.

Sunday, January 22, 2012

the most potent symbol of the year gone by

In Athens, the Greek web mag OUGH says, the supermarket cart was the iconic image of 2011. Not because people are out shopping, but because they're out recycling. An enterprising recycler can earn 20 to 30 Euros a day -- $25 to $38 -- and, as a colleague in Greece suggests, many folks with good jobs struggle to pull in much. It's hard work:

The hunt for scrap and the miles that these people walk every day to get it, is not shown in any economical transaction, no invoices are kept, no receipts are issued, just warm, black money is flowing not only to the lower levels of the system but also at the later stages of the reselling process.  For the smallest junkyard to the biggest, again no records are being kept, the paperwork is barely typical, while at the same time, there is a million-euro turnover that reaches up to the steel industry.  We are talking about huge sums of money, the material prices skyrocket from the time the collectors turn them over to the moment they reach the industrial melting pot to be further used again in constructions.  The story is not simple at all, and it bears no relation to what comes out as an image.
But it's also how people survive and thrive in hard times.

Friday, January 20, 2012

The Yippie Way of Ownership

The whole whoopee cushion of words over the Stop Online Piracy Act and the Protect Intellectual Property Act got me thinking about Abbie Hoffman and Jerry Rubin.

Those two were the most pop-culture-savvy leaders of the group of agitprop rebels who promoted ‘free’ as a lifestyle a generation ago—the Yippies. But, even for them, it was not easy to say exactly what free meant.

Abbie’s first publication, a 1967 pamphlet called Fuck the System, proudly proclaimed the principle of free and open access: “Nothing in this manual is copyrighted. Anyone may reprint this information without permission. If you paid money for this manual you got screwed. It’s absolutely free because it’s yours. Think about it.” (Abbie later disclosed that, through a middleman, the government of New York City had actually paid the printing costs—proving that, then as now, ‘free’ sometimes requires that somebody else pick up the tab.)

In 1968, a year after Fuck the System came out, Abbie published Revolution for the Hell of it. He dedicated the book to “FREE.” He published the book under the pseudonym ‘Free.’ But the book wasn’t free: the hardcover price was $4.95 and the copyright was held by The Dial Press.

When Abbie published his 1971 primer on the art of getting stuff for free, he called it Steal This Book—but he didn’t really want readers to steal it. How do I know? Because he copyrighted Steal This Book in the name of Pirate Editions. Why copyright a book that tells you how to get things for free? Because Abbie was accused of piracy himself. His collaborator and all-around researcher, Izak Haber, called him out for stealing the work without compensation. (Though Haber is acknowledged in the book as a co-conspirator, he didn't feel that was enough, and you can read his account, “An American Dream: A True Yippie’s Sentimental Education or How Abbie Hoffman Won my Heart & Stole ‘Steal This Book,'” in Rolling Stone magazine of September 30, 1971.) Copyrighting the book in the name of Pirate Editions hid the fact that Hoffman had been forced to give Haber a cut of the profits.

Jerry, meanwhile, offered his own spin on ‘free.’ “Money is Shit,” he opined in his 1970 tome Do It! “Money is a drug, Amerika is a drug culture, a nation of crazy addicts….Burning money (and credit cards and banks and property) is an act of love, an act on behalf of humanity,” In Yippieland, he preached, “there will be no such crime as “stealing” because everything will be free.” Rubin acknowledged his collaborators on the title page, noting the book was “Yipped by Jim Retherford” and “Zapped by Nancy Kurshan.” Do It! was copyrighted, though, in the name of the Social Education Foundation—a non-profit. Who could possibly be against Social Education? The Internal Revenue Service, that’s who. One year after the book came out, the feds revoked the tax-free designation, asserting the only charitable work the foundation did was to funnel money to a single truly needy fellow named Jerry Rubin.

So how do Abbie and Jerry shed light on SOPA and PIPA? This way: Abbie and Jerry were right that free is a great and desirable and valuable thing. But they were also chameleons. They advocated ‘free’ when free suited them. And they advocated pay when pay was to their benefit.

This is one of the points that Jaron Lanier made in a New York Times Op-Ed on Thursday. Lanier suggested that we’ve become linear in thinking about these issues rather than acknowledging that copyright and copyleft are both a mixed bag. Addiction to copyright puts big bucks in the hands of big corporations like the ones that make and distribute movies. But copyleft—which offers free usage—puts the big bucks in the hands of big companies that assemble private data and aggregate eyeballs to sell advertising. It’s the bad guys fighting the bad guys. “We in Silicon Valley undermined copyright to make commerce more about services than content—more about our code than their files,” Lanier wrote. “The inevitable endgame was always that we would lose control of our own personal content, our own files.” Translation: we're all fucked.

But, as the money being spent on this battle shows, there are some who aren't fucked. A lot of people say the web is like a commons. Maybe. But it’s a commons where a select cadre of companies are making tons of money.

SOPA and PIPA are apparently no longer being fast-tracked, but the brouhaha is still simmering. The New York Times reports that the Motion Picture Association of America—one of the most ardent supporters of the bills—now wants to sit down with the tech companies, perhaps at the White House. At the same time, the government has upped the stakes by taking down Megaupload, one of the ‘locker services’ that allows users to upload unrestricted content (interestingly, Megaupload recently settled a copyright infringement lawsuit brought against it by the porn studio Perfect 10—though the terms of the settlement were not revealed.) The feds claimed that Megaupload was profiting massively from its position as a drop box for piracy and asserted in the indictment that the firm and its owners and subsidiaries had more than $175 million in cash stashed in 64 accounts in banks around the world. (BTW: can anyone tell me how the government has the standing to bring a case of copyright infringement? And how the government can shutter megaupload without having proved that the company’s done something wrong?)

I confess. Stealth of Nations has a small c in a circle with my name next to it on the back side of the title page. This may seem odd in a book that extols certain kinds of piracy. Indeed, I once owned a well-thumbed copy of Steal this Book—until a friend borrowed it for good. And when Yipster Times, the Yippie paper, published the calling card numbers of various federal agencies and massive corporations, I sometimes used them to make cross-country calls. Charging it to The Man. At the time, nothing felt freer.

Still, I’m glad that that little symbol is in my book. Not because it prevents piracy. Rather, I see it as a printed reminder of a labor of love that consumed years of my life. I trust that people will honor that--that other publishers won’t use my words without my permission and will include my name when they cite stuff I reported. Yes, I want people to buy my book. But the truth is that I can only wish that Stealth of Nations gets pirated and winds up on a site like Megaupload. That would mean it was a success, that it had reached a truly wide audience--and, since nothing will get pirated if there isn't demand for it, that I had made enough money on it that I didn’t need to worry about the lost revenue.

SOPA and PIPA are ugly blunt instruments that will limit free speech and have impacts far beyond the realm of copyright. But we can’t trust Google or Wikipedia to fight this battle either. Indeed, just thinking about Chris Dodd and Sergey Brin sitting down in a room with Obama’s Chief of Staff Jacob Lew and banging out a deal is bone-chilling.

Is there a lesson in all this? Perhaps it’s this: Don’t trust anyone under 40. Don’t trust anyone over 40. And don’t mess with Mr. In-between. Or, as Frank Mankiewicz told Hunter S. Thompson in Fear and Loathing on the Campaign Trail '72: “Keep your own counsel. Don’t draw any conclusions from anything you see or hear.”

Yippie!

Thursday, January 19, 2012

identity economics

Kate Meagher, in her 2010 book Identity Economics chronicles the recent history of the informal garment and shoe manufacturing clusters in Nigeria's Igboland. It's a fairly pessimistic look at the possibilities for these merchants.

She writes, "If the travails of Igbo informal producers have revealed anything, it is that even the most dynamic and well established informal enterprise networks lack the ability to assert their productive interests against the distruptive agendas of local officials, let alone to defy national or global economic and political interests." Meagher calls for strengthening the capacity of informal operators while leaning on the government to find ways to work with informal merchants -- thus allowing them an opening to turn the identity economics of tribal social networks into something that can develop across regions and transcend traditional divisions.

But, in a short epilogue, she adds a bleak new prognostication: locally funded criminal networks and state neglect/persecution are conspiring to drain the life from this hope. "Despite claims to promote informal enterprise, the devil's deal of state neglect and clientalism continues to triumph over any genuine commitment to productive support and political voice within the informal economy. This reckless policy neglect is rapidly squandering the valuable informal institutional resources that could offer a path out of the unemployment, disaffection and criminality engulfing the Nigerian south-east."

When mere survival is a revolutionary act

Zimbabwean street vendors reflects on the battle to survive in this article from the UN's Inter Press Service. Though perhaps 90 percent of working-age Zimbabweans are unemployed, the article notes that "police and council officials move around the city in trucks arresting vendors who sell goods without a licence and confiscating their merchandise. The raids are often violent as the vendors have now organised themselves and are fighting back. On Jan. 11 the Harare city centre came to a standstill as the police and vendors fought, with vendors throwing stones at the police."


As Tafadzwa Nyamupfachitu, a 27-year-old mother of six-year-old triplets who earns a living for her family by selling fruit, cigarettes and cell phone airtime, told IPS, "We fight the police because they are the ones who started attacking us. They took our goods to eat or sell at their houses when we also looking to survive. We are angered by this because we also want to survive. We must enjoy ourselves in our country of birth freely. If we don’t survive that way there is no life for us because we cannot become criminals or turn to prostitution for a living."

It's not just the Mugabe reign-of-terror. All over the Africa--from Zimbabwe to South Africa to Liberia to Nigeria to Tunisia to Egypt--and almost all the countries in between, street vendors are being harassed and threatened. Why is daring to make a living such a revolutionary act?

Sunday, January 15, 2012

show me the money

Oddly, the most sensible declaration has come from an academic: "A really determined effort to stamp out corruption would itself be massively destabilising," Stephen Ellis, a historian at the Africa Studies Center at Leiden University in the Netherlands, told Reuters about the general strike that has paralyzed Nigeria in the week since the oil subsidy was ended. "It can only be done gradually."

The free market absolutists at The Economist magazine may have been in favor of lifting the subsidy immediately. But this showed absolute ignorance of the mechanics of the subsidy. As Alexandra Gillies, of the Revenue Watch Institute, writing in the Huffington Post, noted, the oil subsidy was itself a form of official corruption:
In 2011, the subsidy on gasoline cost the government over $9 billion, more than the entire federal government capital budget and about double the subsidy's cost in 2010. Global fuel prices did not, of course, double during this time period. Nigeria's tab skyrocketed thanks to the costly, corrupt system by which the country produces and imports gasoline, as well as rising interest charges and insurance premiums as government failed to pay fuel importers on time. By the end of 2011, Nigeria owed importers over $4 billion. Relying on the Nigerian National Petroleum Corporation (NNPC), the national oil company, the government devised complex, opaque methods for covering import costs, including swap deals where crude oil was awarded to commodity traders in exchange for gasoline and other refined products.
Nigeria's Socio-Economic Rights and Accountability Project (SERAP), has asserted that the fuel subsidy was hidden from the budget:  "While 250 billion naira was allocated for fuel ‘subsidy in 2011, by the end of October 2011, over 1.3 trillion naira has been spent. We have information to the effect that the subsidy claim rose to 1.5 trillion naira by December 2011... Having found that no supplementary appropriation was submitted to the National Assembly by President Goodluck Jonathan, we would be grateful for information on who authorised the release of the sum 1.26 trillion naira, which was paid by the Central Bank of Nigeria.”

Gillies wants the subsidy to end, but pointed out a conundrum: "High oil prices and increased production should have made 2010-2011 the most profitable years yet for the Nigeria. However, the country's economic health worsened. Budget deficit estimates exceeded $8 billion in 2011 and, over the last three years, foreign reserves dropped by 40 percent and public debt doubled." She said this "paradox of robust revenue potential and declining fortunes" could only be solved through comprehensive reforms.

But, in simple political terms, you can't ask the people to suffer in order to pay the big corporations (Well, I guess you can -- we did it in the U.S. in order to bail out the "too big to fail" banks -- but it hasn't made people's lives any better.) The Nigerian government contends that gradual lifting of the oil subsidy won't work because "investors will be discouraged" and "smuggling and rent-seeking behavior will continue." But the profiteering's going on anyway and the so-called investors are the companies who've been profiting from this clandestine system for years. A friend in Enugu tells me that some petrol there is going for 300 naira per litre -- double what the supposedly free market price is.

If there is to be a comprehensive solution--as Gillies wants--everything has to be transparent. How are all the deals currently working? Who's making the most money? How much has corruption siphoned off from the federal treasury (Nigeria's former government anti-corruption crusader Nuhu Ribadu has estimated that boodling cost the country $7.6 billion a year for the past 50 years and a recent report in Nigeria's Vanguard Newspaper asserted that the country's congressmen and senators are being paid more than $1.5 million a year--an amazingly high amount.)

Until all the dirty financial linen is aired out in public, it's no wonder the people are skeptical. The strike shouldn't stop till the cronies come clean.

Friday, January 13, 2012

invest in life

You, too, can invest in something infinitely more valuable than profits. It's a strange new commodity called life.

As The New York Times reports, Copenhagen's Christiania squatters, famed for their anti-free market ways, are selling shares in their community so they can buy it from the government. What do you get for your investment: "a symbolic sense of ownership in Christiania and the promise of an invitation to a planned annual shareholder party." As one squatter calls it, "ownership in an abstract form."


According to the Copenhagen Post, after striking a deal with the state this summer, Christiania residents now need to raise 76.2 million kroner (almost $13 million) to buy the majority of the area’s properties and an additional six million kroner to rent adjoining green spaces. The first 43 million kroner (or approximately $8 million) is due on 15 April 2012. Several prominent people have purchased Christiania Shares, including Margrethe Vestager, minister of the economy and interior, and Mogens Lykketoft, president of parliament. The shares are available for purchase online at www.christianiafolkeaktie.dk.

no line gets a $50 fine

That's the policy towards food trucks in the nation's capital, as described by Forbes magazine. "Over the past week, District officials have been visiting food trucks and telling them that beginning on Jan 13, 2012, they will be ticketing food trucks that don’t have a line formed in front of them." And this in a city where the profusion of wide avenues, monumental federal buildings, and vast landscaped malls conspire to ensure that there's no commercial frontage on many blocks--so the mobile vendors are often the only place to get your lunch.

Ah, but DC is just following in the footsteps of the municipalities that were ticketing kids with lemonade stands.

Wednesday, January 11, 2012

going green -- but no green to show for it

City Limits details the travails of the 'green cart' program in NYC. Many of the vendors the magazine spoke with are looking to get out of the street trade. Among the magazine's findings:

  • since the inception of the program, over 4,200 applications have been submitted, yet only 640 permits were issued. 
  • interviews with 35 vendors in four boroughs show that the average vendor takes home an annual net income of approximately $7,500 dollars (or an average of $62 a day — less than minimum wage), putting them in the bottom 7 percent of income in the United States.
  • 60 percent of Green Cart vendors who started in 2008 did not renew their permits.
  • from the first year to second year of the program, the number of tickets (and thus, fines that will be levied) per number of vendors increased by 150 percent.
  • parking the cart can cost $250 a month, plus two months security deposit.
  • buying fruits and vegetables can be prohibitively costly, because the main wholesale market is in Hunt's Point--a long jaunt from most other neighborhoods. 
  • One vendor the magazine interviewed reported that he worked 12-hour shifts seven days a week yet was losing between $100 and $150 each day.
Possible fixes include fund vendors' cooperatives, simplifying licensing requirements, creating joint buying clubs.

mob rule

The headlines will go to the sound bite: "the Mafia is Italy's No. 1 bank." But read the fine print: the mob works hand-in-glove with the 1 percent. Reuters has the details.

"The classic neighborhood or street loan shark is on the way out, giving way to organised loan-sharking that is well connected with professional circles and operates with the connivance of high-level professionals," a report by the anti-crime group SOS Impresa said. Old style gangsters handing out cash in bars and pool halls have been replaced by respectable bankers, lawyers or notaries. SOS Impresa calls this "Extortion with a clean face" whose victims typically are "are usually people in traditional retail sectors like food, greengrocers, clothes or shoe shops, florists or furniture shops."

This is one kind of informal economy we don't need--but it's also an indictment of the formal system. If merchant-led credit and investment cooperatives could aid small businesses, they wouldn't have to resort to loan sharks for cash. If it was easier for street markets to operate, they wouldn't have to pay protection money to crime syndicates. The Mafia used to be somewhat communitarian. Now it simply finds ways to exploit needs that the formal system doesn't meet.

from the U.S. to Mexico

It's the great cast-off migration. Items that don't sell at swap meets and salvation armies in the Southwest make their way to Nogales and Sonora and then south of the border. One merchant tells Inside Tucson Business that he puts his goods in storage for a day or two in Arizona and then takes it across the border bit by bit. With a little subterfuge, clothes and small items can be carried over in suitcases.

Merchants at swap meets in American towns along the border report that their typical customers are Mexicans who work in the maquiladora factories that are owned by U.S. companies but operated in Mexico. "If you buy a washer here for 1,000 pesos, the same one goes for 2,000 or 3,000 in Santa Ana and beyond," one dealer told the business paper. The price gets higher the further south you go.

for street vendors, LA is the city of the devils

Whether they're selling trinkets or tamales, the city of Los Angeles wants to do away with street vendors. The New York Times reports that the a new city ordinance that will prevent people selling things of "utilitarian value" from selling them on the street without a license will take effect next week. In the Westlake neighborhood, new signs warn that “street and sidewalk sales of goods are prohibited” and threaten violators with a $1,000 fine or time in jail, the paper reports. But getting a permit for one of the stalls in a new city-sponsored market that will only open on weekends costs $500. So vendors say they'd rather risk selling on the street.

“They can chase me wherever they want, I’ll go and hide someplace for a few minutes and then I will come back again,” Marta Cortez, 43, who has sold fruit and homemade hot chocolate on the street almost since the day she arrived here from El Salvador nearly two decades ago, told The Times. “This is how I make money for my family. If I go to a new market where I can only sell on the weekends, how can I have enough to give my children food to eat?”

--praise be to Zach for sending me the link--

Monday, January 9, 2012

the candy man can

My post on the profits possible from the informal economy in NYC, at harvard business review.

Monday, January 2, 2012

cracks in the economic monoculture

Two decades ago, the mischievous philosopher Paul Feyerabend predicted the difficulties now plaguing the Euro Zone:

The members of the European Community, those standard bearers of Civilization and the Free World, want to bring "backward" regions like Portugal, Greece, and the south of Italy up to their own high level of existence. How do they determine backwardness? By notions such as “gross national product,” “life expectancy,” “literacy rate,” and so on. This is their “reality.” “Raising the level of existence” means raising the gross national product and the other indicators. Action follows...: monocultures replace local production (for example: eucalyptus trees in Portugal), dams are built where people lived before (Greece), and so on. Entire communities are displaced, their ways of life destroyed just as they were in Ceausescu’s Romania, they are unhappy, they protest, even revolt—but this does not count. It is not as “real” as are the facts projected by an “objective” economic science. Is it not wise to be afraid of such a civilization?

(from 'Ethics as a Measure of Scientific Truth,' reprinted in Conquest of Abundance, 1999)

The force of Feyerabend's critique is still with us. The New York Times today quoted Greek Prime Minister Lucas Papademos asking for resolve in seeing reforms [aka cost cutting and belt tightening and increased suffering] through, "so that the sacrifices we have made up to now won’t be in vain." What better illustration can there be of the idea that economic ideals being treated as more important than the facts of everyday life. One economist quoted in the Times even called the austerity policy "sheer madness."

Which brings up possible System D responses to the crisis. This interesting essay, published in the aptly named Journal of Innovation Economics, starts the process of assessing if underground exchange networks, parallel currencies, and free bazaars or swap meets can impact economic life and recovery in Greece. Part of the point of these outside-the-system networks is that they reintroduce the concepts of community and social life into the economic arena. From the essay:
  • "Those economies comprise more than the transaction itself: it is cultivation, experimentation, creation of new household production and nutritional customs, education of adults and children, etc."
  • "They seek the realization of values that do not exist in the conventional economy, or they create a living example, even for just a day, of how it would be when many people can survive together without conventional economic constraints."
  • "They create several types of markets along or outside or in contradiction with the main market type."
Why are we so afraid of these parallel or separate or underground markets? As Feyerabend pointed out, we should be far more afraid of our own system.