It is said that humans are blest with 20/20 hindsight and this is nowhere more true now, than in the debacle that is the financial crisis. One manifestation of this is the BBC programme, ‘The City Uncovered (link below), an excellent, beautifully produced, programme that is a generation, or even more, too late.
We have in the UK, educated for environmental and industrial decline for over 140 years, a royal commission identifying in 1868 that
We are bound to add that our evidence appears to show that our industrial classes have not even the basis of a sound general education on which alone technical education can rest…..and unless we remedy this want we shall gradually but surely find that our undeniable superiority in wealth and perhaps in energy will not save us from decline. Page 205 ‘Audit of War’ 1986, Correlli Barnett.
This lesson was not learnt by the US and the same process is now coming to a climax; the failure to recognise this soon will result in the new President failing to turn the Ship of State’s, bow on to the coming tsunami of the exponential decline in ‘net useful energy’ piled on the wave of financial destruction.
Every sucessful captain knows the port and starboard watches cannot keep changing the trim if the ship is to be steered accurately for a sustained journey. The US’s journey now spans over two hundred years from John Adams on Home Box office http://www.imdb.com/title/tt0472027/ to Barack Obama, and the Ship of State needs a thorough refit and recommissioning. The same, of course, applies to all the western economies, perhaps more so, but the difference is that the free world depends on the sea going qualities of America.
The sad fact is that we have not educated ourselves to understand risk and its consequences, as is abundantly clear from the BBC’s documentary. Risk arises out of not ‘doing the right thing’ or doing it wrong; of less than perfect ‘Quality’, as the Japanese learnt from Deming http://en.wikipedia.org/wiki/W._Edwards_Deming and Juran http://en.wikipedia.org/wiki/Juran
Our financial institutions have failed to grasp, through this collective failure in education, what Sir Gordon White Knew and Lord Hanson commented on in the 1980’s
”Look at the downside” should be carved on his tombstone see link below
The rocket scientists of finance, the city uncovered.
When the Mars Climate Orbiter took off from Cape Canaveral in December 1998, the engineers at the Jet Propulsion Laboratory in Pasadena were undoubtedly elated……………
…………..Nine months later though, it was only their red faces that were on show. The spaceship vanished………………
…………..(It was discovered that) group was using imperial measures of force in its navigation programming, while the other was working in metric.
On such occasions, one inevitably finds oneself asking how such clever people can make such silly mistakes. ………….
Complete story at http://news.bbc.co.uk/1/hi/business/7826431.stm
BRITONS ON THE PROWL
LATE IN THE FALL OF 1973, A 6-FOOT, 4-INCH BRITON named Gordon White marched into the Pierre hotel in Manhattan, took over a one-bedroom suite on the 37th floor and set about building an empire.
As co-founder and vice chairman of Hanson Trust P.L.C., then a four-year-old London-based conglomerate, White had earned something of a reputation in Britain as a shrewd, aggressive takeover artist. Now, in the hotel room that doubled as his home and the American headquarters of Hanson, he was starting from scratch, with $3,000 in cash in his wallet and a list of contacts to call. The question: Could his redoubtable skills as a corporate raider be transplanted to the New World?
………………..Sir Gordon’s methods of sniffing out worthwhile properties may be a trifle haphazard by some standards. ”People like to believe that I have a crystal ball and a five-year plan,” he says, but that is not the case. He also distinguishes himself from such high rollers as Sir James Goldsmith. ”We’re very different, Jimmy and I. He’s a gambler. I’m not. I never would have bought Diamond International.” Instead, Sir Gordon claims to focus on how much he can lose, not win; Lord Hanson jokes that ”Look at the downside” should be carved on his partner’s tombstone………………….