Parts to Wholes: the Socionomic Systems Nexus

Special & General

Hard Medicine Is Easy to Offer, Tougher to Take Henry Paulson faces lots of criticism these days for his handling of the subprime-mortgage crisis. In one corner, free-market purists say the Treasury secretary shouldn't meddle in a mess the markets created and ought to sort out. In another, critics say the government should do more to contain the crisis and help innocent bystanders. Watching from afar, Rizal Ramli sees the irony in all this. In the late 1990s, the U.S. Treasury and International Monetary Fund dispensed much advice on economic pain management in such places as Mr. Ramli's native Indonesia. Indonesia listened. It tightened fiscal and monetary policy and shut down 16 banks as advised. A 13% economic contraction followed. Recovery took years. At the center of any debate about crisis management are two big questions: How much pain should people be expected to bear when markets turn boom to bust? And who should bear it? Seven decades after the Great Depression, economists still are trying to calibrate the government's proper role. As Mr. Paulson is discovering, the answers aren't easy. If policy makers embrace tough medicine, allowing banks to fail and mortgage defaults to soar, they risk an Indonesia-style downward spiral in which millions suffer. If they intervene too aggressively to forestall the pain, they could end up with a different problem, a financial system that remains dysfunctional for years, as Japan's did when nonperforming loans were allowed to sit idly on bank balance sheets throughout the 1990s. The U.S. has tended to preach tough medicine abroad, but it now looks squeamish about taking it at home. It is especially hard to accept when the bystanders, numbering in the millions, are preparing to vote in a national election. Some banks are too big to fail. The legions of worried mortgage holders now seem to be too many to fail, in politicians' eyes at least.

ATTRITION: No Shortage of Recruits The army is facing an unprecedented situation. Never before has it had so many troops who have experienced so many days of combat. In the past (Vietnam, World War II) casualties were several times higher. but combat was not as prolonged. Thus few troops lasted 200 or more days in combat. During World War II, it was found that 200 days was the average combat exposure a soldier suffered before starting to experience debilitating PTSD (post-traumatic stress disorder). The patterns of combat were different than during World War II. For example, the bulk of the troops in Europe went in after June 6, 1944. The fighting in Europe ended eleven months later. In the Pacific, the fighting tended to be episodic. A few months of combat, followed by many months of preparing for the next island invasion or battle. In Vietnam, not a lot of people went back for multiple tours, and those who did spend a year with a combat unit, spent less time in combat than they would in Iraq. Even during Vietnam, it was noted that many of those who were in combat for 200 or more days, did get a little punchy. In Iraq, army combat troops often get 200 days of combat in one 12 month tour, which is more than their grandfathers got during all of World War II. And some troops are returning for a third tour in Iraq, which is now fifteen months. The army has found ways to avoid the onset of PTSD (better accommodations, email contact with home, prompt treatment for PTSD), but many troops are headed for uncharted territory, and an unprecedented amount of time in combat. Thus  new programs to spot PTSD as early as possible, and new treatments as well.

Values and Attitudes

Mr. P' Learns His Lesson  I had never really thought about teaching as a second career. But a series of unrelated events had nudged me down the path. I had few romantic notions about teaching. Still, the reality was daunting. Not one in five of my school's students could read at grade level, so I rolled up my sleeves and got to work. I established myself as a no-nonsense, high-expectations teacher. Although I had budgeted for two years in the South Bronx, the chalk dust got into my blood. Yet somehow, in year five, I hit a wall. Over the course of the school year, several students were transferred out of my room -- one whose parents complained I gave too much homework, another whose father didn't like that I enforced the school's uniform policy. Then came the confrontation in the principal's office. Frustrated and increasingly bitter, I realized I was becoming exactly the kind of teacher I had signed up to replace. I had no desire to go back to corporate life, but this couldn't go on. I simply no longer felt effective. I was especially frustrated for my highest-achieving students. I have nothing but admiration for high-minded education reformers, teachers, and administrators who want to make sure every child goes to a great school. But one of the unintended consequences of the accountability movement in schools is that virtually all of a teacher's time and attention goes to the lowest-performing students. We lie to ourselves that we're educating high-performing kids because they test at or above grade level on dumbed-down state tests. The second act of my second career began to emerge almost unbidden. I stopped looking for a job and started focusing on the high-achieving, low-income children I felt I had failed as a teacher. An idea I had put away to launch an after-school program for bright, inner-city kids someday suddenly moved to the front burner. If the job I wanted didn't exist, I would create it.

Helping Boomers Give Their Best As millions of people in their 50s and 60s exit the corporate world, many will search for "encore careers" in the public and nonprofit sectors. This could result in the biggest transformation in the U.S. workforce since women began pouring into it some 30 years ago. Baby boomers could be blowing a lot of hot air. I think whether they retreat into another round of selfishness or can respond to JFK's challenge -- to ask not what the country can do for me but what I can do for the country -- will have to do with whether we as a society call them up to a higher purpose. We need to create the on-ramps to work that matters and embrace the talent. There is definitely a lack of realism over what it means to do this work. That's why, if you think you might be interested in a give-back career for your encore, you should get as much experience as possible before making the leap. Boomers will do these jobs if they feel they are making a genuine impact or if their time isn't wasted and their experience is put to good use. If these things aren't there, it becomes a question of grinding it out in a nonprofit for less profit versus working for a corporation. I don't think many people will make that choice unless they are masochistic.

Int’l Affairs

One Night in Bangkok Shows the Folly of Bali: Anyone looking for evidence of climate change would normally peruse scientific journals, academic reports and World Bank warnings. This week, one could just monitor the vapor trails over Bali. More than 10,000 world leaders, activists, drought-stricken farmers, journalists, Nobel laureates, Leonardo DiCaprio, you name it, are jetting to the picturesque Indonesian island to save the planet. All those air miles are, of course, contributing to the very problems the United Nations climate- change treaty talks aim to tackle. The 12-day conference may produce 100,000 tons of carbon dioxide and other pollutants, according to Chris Goodall, author of ``How to Live a Low-Carbon Life.'' That's roughly what the African nation of Chad emits annually. Amid so many risks, leaders in Thailand and elsewhere in the developing world somehow need to find the resources and political will to address climate change. They also need to overcome a lack of urgency in developed nations, which should be doing more to share with poorer countries the scientific know- how needed to cut pollution. There will be negative consequences for output and productivity in many countries. Achieving development goals may be jeopardized by deteriorating fiscal positions as a result of weakening traditional tax bases and increased expenditure on the environment.

Modi the Model? In Gujarat, the BJP ditches Hindu nationalism. The last time the state of Gujarat went to the polls, the Bharatiya Janata Party whipped up anti-Muslim sentiment to win re-election. Now, the BJP is running largely on a campaign of its core competency: economic reform. That's a far better model for the party to follow nationally. Whether the BJP's reinvention will take root is another story, but the elections in Gujarat this week -- one of India's biggest states -- should provide a good guide. The current chief minister, Narendra Modi, is a controversial figure who played a role in the BJP's fall from grace nationally. As chief minister of Gujarat in 2002, his government stood idly by while more than 2,000 people died in ethnic violence. By and large, he's done an excellent job. Gujarat grew over 11% last year on the back of an influx of foreign investment and a robust manufacturing sector. In a country with subpar infrastructure, the Modi government has built roads, ensured a steady supply of electricity, eased labor restrictions and secured regular water supplies for rural areas, to name a few achievements. Mr. Modi achieved economic progress in Gujarat in large part because he wasn't afraid to tackle India's sacred cow: public-sector corruption. The chief minister put systems for public accountability of civil servants in place, installed more courts to work through a backlog of lawsuits and cut out whole layers of inefficient bureaucrats from decision-making processes.That hasn't always won him friends within his party.

Mugabe's Apologists They hail from both Africa and Europe. Robert Mugabe's participation in the European Union-Africa summit in Lisbon over the weekend was a triumph of Zimbabwean diplomacy. Both African and EU leaders must share the blame for this farce. Zimbabwe's foreign ministry managed to portray the octogenarian dictator, who has presided over widespread violations of human rights and an astonishing economic collapse, as the victim of a Western conspiracy. The response of the African leaders to this man-made catastrophe has been to close ranks around Zimbabwe's leader. Some have publicly agreed with Mr. Mugabe's claim that his country's economic woes are due to (targeted) Anglo-American sanctions, rather than the government-sponsored destruction of Zimbabwean commercial agriculture. Of course, supporting Mr. Mugabe does not further the cause of African brotherhood; most of the victims of his disastrous policies are black Zimbabweans. Sadly, EU officials succumbed to the blackmail of African leaders who threatened to boycott the Lisbon meeting unless Mr. Mugabe was invited as well. The EU officials should have called their bluff: From trade to foreign aid, Africa depends on Europe far more than Europe needs Africa. Refusing to budge would have forced African leaders to make a very public choice between going to Lisbon in order to negotiate pressing issues, such as further opening Europe's markets to African goods, and self-defeating "gesture" politics by staying away in solidarity with a tyrant. In the event, the trade talks broke down anyway. Some African leaders felt that gradual -- in some cases, decades-long -- opening of African markets to EU goods in exchange for immediate duty-free access of African goods to the EU was too high a price to pay. They chose instead to walk away with nothing.

Showdown at Fort Tiuna There is only one thing more amazing than Hugo Chávez's defeat last week in a referendum designed to give him dictatorial powers. That is the suggestion, now being peddled by some members of the foreign press, that by accepting the loss the Venezuelan president has proven his democratic bona fides. After nine years of Chávez rule Venezuelans know their president all too well, and there was plenty of hand-wringing this past week about the potential for a Chávez crackdown in the wake of the referendum. This gives Venezuelans reason to be fearful. But the events that transpired behind the scenes on the night of the referendum have leaked into the public arena. And now there are grounds for hope too. As it turns out, Mr. Chávez is neither as popular nor as powerful as his friends in the foreign press have made him out to be. Mr. Chávez denies that the military pressured him into accepting defeat. But he has not denied that he went to Fort Tiuna and met with the high military command. Mr. Lugo-Galicia reports that the president told the officers that until 100% of the votes were counted he would not recognize his defeat. In the end, while Mr. Chávez did not ignore the vote, it wasn't because he didn't want to. Rather, he calculated that giving in, when all the evidence was against him, was safer than facing an almost sure uprising from the population, which the military had already said it would not put down.

• The wind goes out of the revolution Venezuelans have seen the future—and many of them realise that it doesn't work

Over to you IN SOME countries the suspense of a presidential election is based on the question of who is going to win a popular poll. In Russia it centres on who the outgoing president (in this case Vladimir Putin) picks as his successor. On Monday December 10th the winner was announced. Dmitry Medvedev, a 42-year-old lawyer from Mr Putin’s native St Petersburg is almost certain to become the next president in March. By appointing him as successor Mr Putin achieves two results. One is that Mr Medvedev will most likely lead the country along the path already set by Mr Putin. The other is that Mr Putin himself will retain influence when his term expires in less than three months. Nor is Mr Medvedev the worst choice. He does not have a KGB background, unlike many trusted by Mr Putin. And he is considered as a relative liberal within Mr Putin’s entourage. He did not appear to support the arrest of Mikhail Khodorkovsky, the Yukos chief, and he did not subscribe to the concept of “sovereign democracy”, saying that democracy did not need adjectives. The timing of Mr Medvedev's elevation is also intriguing. It came earlier than many had expected. The rumour in Moscow had been that the anointment would take place next week at the congress of United Russia. One explanation is that infighting between various Kremlin clans had reached such a pitch that the situation was becoming unstable. Security chiefs were fighting among themselves and collectively against more liberal figures in the .Mr Medvedev will have to tread carefully: the Kremlin is far from being a stable political structure. He may also have problems with the economy.

MURPHY'S LAW: The Chinese Dilemma  The Chinese Dilemma China recently held military exercises off its southeast coast. They included naval, air and ground forces. Despite the fearsome appearance of all this, China isn't looking for a fight . But they do have armed neighbors who might want one (Vietnam, a reunited Korea, Japan, even Russia), and there's always Taiwan, which is really the only point of dispute with the U.S. China knows it's the biggest nation in the region, with lots of dormant disputes with powerful neighbors. And for most of the last two centuries, China has been unable to defend itself effectively. Even their nuclear weapons are more of a bargaining chip than an effective defense. Until quite recently, the basic Chinese military defense was a massive guerilla war, which would cede large portions of the country to any invader. From China's point of view, their military buildup is long overdue, and way behind schedule. Most Chinese are perplexed at foreign anxiety over growing Chinese military power.

ME

IRAQ: The World Wonders Daily oil production is back up to 2.5 million barrels a day. Iraqi bonds (issued as part of a foreign debt forgiveness deal two years ago) are up as well. The economy has been growing, in the quiet areas, since 2003. Overall, the nation is in much better shape economically, although you'd hardly know if from Western press reports. But all is not well, and much is wrong.  But Sadr is not the only religious fanatic trying to impose his will on others. There are dozens of religious leaders trying to make everyone follow their vision of what Islam should be, and willing to kill those who do not comply. Now that the Sunni Arab terrorists have been beaten down, the Shia Arab fanatics have come out to kill and destroy. These thugs will kill Christians if they catch them with whiskey, and women if they catch them not wearing a veil. Students of history note that, in the past, squabbling among the Shia factions in Iraq have allowed the Sunni Arab minority to take over. Many Sunni Arabs believe it is inevitable that this will happen again. Shia Arabs are aware of this, but it is still uncertain if the Shia can get organized, stay organized and retain power. Arabs have, over the past few centuries, demonstrated a remarkable skill at self-deception, civil disorder, corruption, misrule and a general inability to get their act together. Blaming it all on foreigners has gotten old, even for a lot of Arabs. Now we have Iraq, where the foreigners took down the tyrant and offered democracy. What will the Iraqis do? The world wonders.

ISRAEL: Palestinians Cannot Make Peace Palestinians, both moderate Fatah and radical Hamas, want to make peace, or at least arrange a cease fire, with Israel. That's mainly because the Palestinians have run out of ideas, and admit that their war against Israel has been a failure. The terror campaign, which began in late 2000, peaked in 2002, with 28 attacks inside Israel, and 173 killed. Year by year since, new Israeli counter-terror tactics have shut down Palestinian operations. Last year, there were only two terrorist attacks inside Israel, leaving fifteen dead. So far this year, there has been one attack, and three dead. With the terrorist operations shut down by Israeli police and commandoes, the Palestinians shifted to home made rockets and mortars three years ago. But these attacks, often over a thousand a year (and over 2,000 this year), never killed more than seven Israelis a year. That was in 2004. Last year, two Israelis died, and so far this year, another two have died. Israeli counter-measures against the Palestinian rocket and mortar crews have left hundreds of Palestinians dead or wounded. Since late 2000, nearly 4,000 Palestinians have died because of the Palestinian terror campaign against Israel. The Palestinian economy has been crippled because of the Israeli counter-terror measures (keeping Palestinians out of Israel) and most Palestinians have been reduced to poverty, and dependence on foreign food aid.

COUNTER-TERRORISM: Web Jihadis Under Attack By Arabs  In Saudi Arabia, the kingdoms intelligence agency is wants new laws that make it illegal to spread terrorist ideas. The intel people are particularly unhappy with the growth of pro-Islamic terrorist web sites. The Saudis believe there are 17,000 such sites out there, which is far more than what Western intelligence agencies come up with (5-6,000). Saudi counter-terrorism officials want to go on the offensive, with official web sites to counter the pro-terrorist propaganda on the net. The kingdom is already having prominent religious figures denouncing Islamic terrorism, and shutting down any clergy who still support terrorist violence. The Saudis have been very effective in catching Islamic terrorists before they can carry out planned attacks. There have been no successful attacks for three years. But in 2003-4, there were several, all triggered by the U.S. invasion of Iraq. This led to Al Qaeda breaking the long, and unofficial, truce it had with Saudi security forces. The basic deal was that al Qaeda operatives could live in the kingdom as long as they did so quietly. No violence, although discreet fund raising was tolerated. The terrorists were enraged by the U.S. occupation of Iraq, and went on a rampage. Since the Saudis had a pretty good idea who the pro-al Qaeda people were, and most Saudis became much less tolerant of al Qaeda terrorists after terrorist bombs started going off in their midst, the Saudis were successful in rounding up the terrorists. This was accelerated by the replacement

Politics and Policies

Giuliani's Firm, Utilities Team Up to Strangle U.S. Renewable-Energy Plan A lobbying blitz by some of the U.S.'s biggest utility companies is likely to strangle the most potent provision in energy legislation that's making its way through Congress. Southern Co., American Electric Power Co. and other producers hired top Washington lobbyists, including Rudy Giuliani's firm, to help defeat a measure that would force them to boost electricity generated by wind, solar and other forms of renewable energy to 15 percent of the U.S. total by 2020. That's up from less than 2 percent today, and is a move the industry says would cost at least $67 billion. Other provisions of the energy bill, such as the first increase in automobile fuel-economy standards in three decades and a mandate to increase the use of ethanol and other alternative fuels, aren't as disputed. That's because they were largely worked out with industry input and would be included in any bill sent to the president. The renewable-electricity standard is contentious because it may substantially raise electricity bills in some regions. Wind, solar and biomass power production are more expensive than fossil energy options such as coal or natural gas. The power companies say they can't meet the standard because environmental conditions in the South and Midwest don't lend themselves to wind energy.

Tax Fix May Doom Spending Cuts, and Democrats: House Democrats find themselves at a dreaded fiscal-policy Rubicon, and they have their political allies in the U.S. Senate to thank for it. Wrapping up what has become easily the most disastrous legislative year for a majority power in memory, Speaker Nancy Pelosi will do her party significant electoral harm whether she crosses the river or not. Republicans are quietly celebrating and are increasingly optimistic about next year's elections. As the Democrats surged to victory in the 2006 election, fiscal discipline was the centerpiece of their economic platform. In a widely distributed document, ``A New Direction for America,'' Democrats promised that ``instead of piling trillions of dollars of debt onto our children and grandchildren, we will restore `Pay-As-You-Go' budget discipline.''  Democrats, to their credit, followed up on their promise and adopted Paygo rules, which required that any increase in spending or taxes must be paid for with offsets elsewhere. Last week, we learned that this was all for show. Senate Democrats shot the Paygo rules in the head, placed them in a casket, and buried them six feet under in an unmarked grave. They did this when the Senate voted 88-5 to pass a $50 billion one-year ``patch,'' or temporary fix, of the alternative minimum tax. Look at some other key parts of their 2006 election platform. Not only have Democrats failed to get President George W. Bush to withdraw American troops from Iraq, but the ``surge'' that they opposed so vehemently is proving effective. They promised to end pork-barrel spending, but have been as addicted to pet projects as their predecessors. Now, they are breaking their own Paygo rules. The really bad news for Democrats is that voters have noticed. As we learned when President George H.W. Bush was voted out of office for violating his pledge not to raise taxes, voters expect their leaders to do what they say they will do. Only about 20 percent of those surveyed last month by the Gallup Organization approved of the way Congress is handling its job. In an NBC News/Wall Street Journal poll, just 39 percent said their own representative in Congress deserved to be re- elected.

Science and Culture

COUNTER-TERRORISM: We Know Where Your Granny Lives There are many kinds of terrorists out and about, and not all of them are fixated on the kind of tactics that are constantly reported in the media. Some Animal Rights Extremists have been attacking people they dislike indirectly, by using the Internet to initiate attacks on their elderly relatives. It's pretty easy – if you persist in opposing them, they'll do stuff like post your parents' social security numbers, and other vital information on websites run by cyberthieves. Apparently terrorists of all sorts keep in touch, because these  Animal Rights terrorist tactics are now being discussed on Islamic terrorist websites. Western counter-terrorism organizations are scrambling to find a way to counter these new methods. Many Islamic terrorists have been caught funding their operations via Internet crime, so they are already familiar with identity theft, and how to find things on the Internet. The web-based Islamic terrorists are apparently planning to harass the families of military personnel, police, and so on. Or worse.

Franco Harris Sells Doughnuts in League of Bankrupt Former Football Stars When Spencer Folau retired from the National Football League two years ago at age 32, he had no clue what to do next and no one to turn to for answers. Folau found that after nine seasons in America's No. 1 sport, he didn't know how to file for benefits or disability or where to find a lawyer or financial planner. While fans embrace longevity in players like Brett Favre, the Green Bay Packers quarterback who has started 250 consecutive games and is in his 17th NFL season, most players are bounced out of what they call the ``Not For Long'' league after about three years. They have earned an average of $1.6 million annually and are typically in their 20s. Within two years of retiring, 78 percent are bankrupt, divorced or jobless, according to GamesOver.org, an Oregon-based support group. There's no telling what happens after that, says Franco Harris, the Pittsburgh Steelers Pro Football Hall of Fame member. Reaching the NFL mostly precludes resume-building. Harris started Pittsburgh-based Super Bakery Inc. in 1990 after 13 seasons in the NFL, including four Super Bowl championships. The company sells pre-made, nutritionally enriched doughnuts and other goods.

In retail, men are hunters, women gatherers They're as different as Target and Tiffany when they shop. Men, who have often been accused of being merely replacement shoppers, tend to be more utilitarian when they hit the malls and shopping centers. It's a mission. Get in. Get what's needed. Get out. Quickly. Women, on the other hand, generally like to look around, talk to sales associates and experience the shopping. They walk around, smell perfume, touch clothes, dab on cosmetics. They want attention and they want direction. The differences are as primitive as hunter vs. gatherer. Better yet is the sales associate who holds men's hands through the checkout so that they get through it quicker. Women told surveyors that they liked it when associates showed them different styles and new items. Twenty percent of women said they were ignored by sales clerks, mostly because they thought the clerks were more interested in talking with each other about their weekend plans or were on the phone with friends. A whopping 47% of those women said they would never go back to that store. More men - 22% -- recounted incidents of feeling snubbed, but only 22% of those men considered it a lifelong negative mark. "Being ignored is a big issue for women," Courtney said. "It's a loyalty issue." Men ditch stores, too, but their biggest reason to do so is when products are out of stock. Men complained they experienced that when shopping 24% of the time compared with it happening to women 21% of the time. But here's the real kicker: Of those men who complained, 43% said they would never shop at those stores again; only 16% of women cited that as a reason to stay away.

Marrying for Love ... of Money Marrying for money isn't just grist for television plot lines. With the wealth boom creating unprecedented riches -- and greater opportunities for gold-digging by both genders -- price-tag partnerships and checkbook breakups are increasingly making headlines. Even more surprising, according to a new survey, are the going rates for today's mercenary unions. Fully two-thirds of women and half of the men said they were "very" or "extremely" willing to marry for money. The answers varied by age: Women in their 30s were the most likely to say they would marry for money (74%) while men in their 20s were the least likely (41%). Whatever the case, the prices for both men and women seem surprisingly low, given the new landscape of wealth. While $1 million or $2 million may sound like a lot to people making $30,000, it's hardly enough to transform someone's life or make them "rich" by contemporary billionaire standards. No one in the survey quoted a price of more than $3 million. Of course, when the mercenary marriage proves disappointing, there's always divorce. Among the women in their twenties who said they would marry for money, 71% said they expected to get divorced -- the highest of any demographic. Only 27% of men in their 40s expected to divorce. Says Mr. Prince: "For these women, it's just another step on their journey to the good life. They want to be paid what they think they're worth and then move on."

Murders of Merrill Banker, Brother Echo in Tale of Sad Life: Susan Antilla The big treat in a murder mystery is the suspense you experience before finding out, at the bitter end, who did the heinous deed. Joe McGinniss, the bestselling author of ``Fatal Vision,'' couldn't cash in on that form of surprise in his latest book, which recounts the grisly murder of Merrill Lynch & Co. banker Robert Kissel in Hong Kong. News stories about the 2003 slaying had already made clear that his shopaholic wife did it. Yet there's no lack of tension in this account of Robert and Nancy Kissel and their life of empty abundance. ``Never Enough'' takes you on a journey through a weird, real-life tale of how people with too much money and too little soul can wind up the stuff of supermarket tabloid headlines. That said, this is a great read that leaves you with lots to mull over about how rich people can deceive themselves. Rob Kissel ``couldn't understand'' that the more he earned, the less happy his wife was, McGinniss writes. Yet when his father-in-law asked Rob how much money would be ``enough,'' the answer provided a key as to why he and Nancy had a bond in the first place. ``There is no such thing as enough,'' the banker said.