Author: John Plodinec

Dr. John Plodinec is an independent scholar. As part of the Community and Regional Resilience Institute (CARRI), he was responsible for identifying and evaluating technologies that can enhance a community’s resilience. His most important contributions have been development of action-oriented tools that operationalize the “Whole Community” concept, including CARRI’s Community Resilience System and its Campus Resilience Enhancement System. He has also helped several communities and universities develop plans to recover from economic and natural disasters. Dr. Plodinec also coordinated development of an action plan for management of woody biomass and debris generated by disasters in support of the federal government’s Woody Biomass Working Group. This effort involved a team from seven federal agencies as well as coordination with other major stakeholders in the American forest enterprise. Dr. Plodinec also developed CARRI’s Resilient Home Program, aimed at improving the survivability of American homes to natural disasters. This built on earlier work he did while at Mississippi State University, where he led the University's efforts to develop programs related to severe weather events. As part of a joint program with the International Code Council and other partners, he has led initial development of a Community Resilience Benchmark System.

The AI monster will get you if you don’t watch out

All we need to do is make sure that we’re in a position to benefit from uncertainty and volatility instead of being harmed by it. ~ Nassim Taleb

If you’re confused about the impacts of AI, you’re not the only one. Some predict that AI will destroy civilization as we know it; some predict that AI will revolutionize our lives. Some say that our jobs will be gone; others that we’ll be able to do those jobs better, and there will be lots of new jobs we haven’t even conceived of yet. The one thing each of these seems to have in common is the impact that AI is currently having on the speaker, i.e., the impacts are seen only through the eyes of the beholder. Certainly the impacts of AI are both highly uncertain and highly personal.

As both Niels Bohr and Yogi Berra have said (in almost identical words!), prediction is difficult, especially about the future. So I won’t try to predict AI’s ultimate impacts. Undoubtedly they will be profound, and compounded of good and bad. But I will provide some facts to help think about AI’s impacts, and how to adapt to them. For one thing is certain: the more adaptable we are, the better our chances of avoiding being devoured by the AI Monster.

Impacts on individuals

As a few of you know, I was involved in some of the early attempts to deploy AI in the real world, in the 1980s. At that time, the practical emphasis was on development of “expert systems.” These required gathering the knowledge and experience of experts in a given field, and converting it to a set of rules along the lines of “If some condition, then do this.” And the results were sometimes impressive. For example, a psychological diagnostic system was developed that was as good at dealing with psychological trauma as human therapists.

A lot of the current effort in AI is still this: replacing the “man-in-the-loop” for foreseen situations with a set of rules. The major difference is that our increased computing power and the advent of Big Data are allowing developers to vastly increase the scope of what is “foreseen” and our ability to act swiftly. As a result, we have self-driving cars with accident rates below those of human drivers. We have “apps” that write computer code more rapidly than human programmers, and (if not now, eventually) with fewer errors. AI has growing capability to diagnose diseases, to dig through case law to find relevant precedents, even to point to promising areas for research.

This is due to the evolution of AI from task-based – if-then rules based on a defined body of knowledge trained to act; to generative – systems able to change themselves in response to new knowledge. This is often called “machine learning.” App-adaptation might be a more apt term.

This makes it seem like the doom-and-gloomers are right. The AI Monster will devour us all. Well, not quite; it’s complicated. And if you’re going to escape from the AI Monster [maybe] lurking in your closet, you need to look at your situation through several different lenses.

• Current employment. The most quoted unemployment rate in the US is currently at 4.3%. Personally, I find labor force participation more meaningful; for 25-54 year-olds it’s about 84% (pretty high). Conversely, it is in the 60% range for those 16-24. This implies that level of experience is important. If young people aren’t being hired to do a job, or, worse, those with experience are being laid off, that’s a sign that the job is in jeopardy.

• The job itself. It’s almost become a truism that AI won’t displace those in the “high touch” professions (e.g., family services, sales) for a very long time. But even there, many of the more routine tasks in health care (e.g., reading x-rays, billing) are being taken over by AI. On the other hand, many knowledge workers are at extreme risk. It seems like every week thousands are being laid off by one of the Big Tech companies. Whatever the field, jobs requiring flexibility, especially those developing policy or strategy, are likely safe for a very long-time.

• Cost-benefit. Generative AI systems are expensive to develop. They require massive amounts of domain-specific data, tremendous computing power, and extensive testing. And lots of electricity and air conditioning as well! The greater the complexity of a given job, the less attractive it becomes for AI – the costs may outweigh the value of displacement.

I asked both Claude and ChatGPT (two of the leading AI apps) “What will be the impact of generative AI on future jobs in the US?” Both gave lengthy responses. Claude’s was better written, and I found more generally useful:

The pattern with previous automation was that it tended to displace routine physical work — assembly lines, data entry, basic bookkeeping. Generative AI breaks from that pattern in an important way: it’s targeting cognitive and creative work first. Paralegals, junior analysts, radiologists reading scans, software developers doing boilerplate code, copywriters, customer service agents, financial advisors doing routine portfolio management — these are all in the crosshairs in the near term.

Jobs with the highest short-term resilience tend to share one or more of these traits: they require physical presence and dexterity in unpredictable environments (plumbers, electricians, nurses doing hands-on care), they depend on genuine human relationship and trust (therapists, certain kinds of sales, clergy), or they require highly contextual judgment in novel situations (senior executives, certain researchers, emergency responders). …

The most likely scenario is not a clean “AI takes jobs, new jobs appear, equilibrium restores” story. What’s more probable is a bifurcation: a class of highly-educated, adaptable workers who use AI to become extraordinarily productive and well-compensated, and a much larger group of workers displaced faster than they can retrain, in a demographic environment that offers fewer natural correctives than past transitions. The demographic plateau softens the raw unemployment numbers, but doesn’t address the human cost to specific workers and communities.

ChatGPT, on the other hand, gave a similar answer with two interesting twists. First it provided more detailed impacts for important sectors (e.g., tech and IT, government, education, manufacturing). ChatGPT also looked at the impacts of AI over time. In the short-term, it predicted job losses, some increases in joblessness and reduced hiring of new college graduates. In the medium-term (3-10 years), ChatGPT saw restructuring of existing jobs (skill in using AI becoming embedded in many jobs) and the rise of new categories of jobs (e.g., “prompt engineering,” data governance, AI trainers and testers). In the long-term (10+ years) ChatGPT weaseled out of prediction and instead fuzzily pointed toward a bifurcated future.

From all of this, let me offer the following guidance to all of you worried about becoming a victim of the AI Monster.

  1. No matter your profession or vulnerability, become familiar with AI tools. AI is here to stay. And it’s getting better at doing routine and non-routine tasks. If you can use it, it will increase your value to your employer/customers/clients. More importantly, using AI tools can actually increase your job satisfaction.
  2. Work to redefine your current job to require more non-routine problem-solving. This will help you to further develop AI-complementary skills: learning, planning, creativity and decision-making.
  3. Continually increase your knowledge about how your job/profession plugs into everything around you. Most importantly, focus on your own personal value proposition. But be brutally honest with yourself: if you’re mired in the routine, your value-added may not be high, i.e., you may be vulnerable.
  4. Increase your value. Certainly, taking on more responsibility is one obvious way. Perhaps more importantly, increase the complexity of what you do, especially if your work is largely repetitive or routine. If you can’t, best brush up your resume, and your skill set (see #1). If you can, find a way to apply your skills in a “high touch” environment.
  5. An important way to do both #2 and #3 is to expand your own personal network. Try to determine how people with your skills are used elsewhere. Perhaps more importantly, become a linchpin: a conduit for useful information. Involvement in professional societies can help you do this.
  6. Develop a “Plan B” for yourself. Identify where your current skill set might be of use. Continue to expand your skill set (again, see #1).

Impacts on communities

Claude’s response quoted above points out that AI will impact both individuals and communities. In my next post, I’ll explore potential impacts, and suggest things communities can do to better buffer themselves against potential harm.

Narratives

Narratives … help us to make sense of the world and understand our place in it. — Simon Webb

Each of us has our own story. It is our perception of our own histories stitched onto an underlying fabric that extends beyond our experience. This fabric is Narrative. It is a compounding of history and myth; memorializing our cultural history.

In pre-literate times, each tribe had its own Narrative. These tribal Narratives preserved (and often embellished!) the exploits of the tribe’s heroes and served as a sort of cultural infrastructure. The tribal Narrative channeled action into certain areas while often constraining or even preventing action in others. Unfortunately, in America we have begun separating into two tribes, each with their own Narrative.

The more traditional American Narrative is aspirational. In its purest form, it teaches us that, with hard work, we can rise above any adversity – poverty, racism, ignorance – to make a better life for ourselves and our families. In that sense, it embodies a philosophy of Hope, and emphasizes the ability of the individual to “make a difference.”

And it has its own Heroes – Andrew Carnegie, a poor shoeshine boy who became a titan of industry; Frederick Douglas, overcoming slavery and illiteracy to become one of the most influential figures of the last half of the nineteenth century; Chris Gardner, growing up poor in an abusive home – functionally illiterate – becoming a multi-millionaire stock broker (and the inspiration for The Pursuit of Happyness).

The other Narrative, born in academia, seems founded on a philosophy of Despair. No one can rise above adversity on their own; only groups (sub-tribes) can. It stresses the “warmth of the Collective,” and despises the individualism inherent in the traditional Narrative. According to this Narrative, nothing that came before is good or worthy of emulation. America is inherently —ist: racist, fascist, capitalist, misogynist…

There are no Heroes – or if there are, they are remembered for their acts of destruction (e.g., Luigi Mangione, for murdering an insurance executive). Action based on individual merit – how can that be when the individual is unimportant? The only action worthy of the name is destruction of the current evil – America – and opposition to everything it stands for. Not least of which is the traditional Narrative.

Intolerance is inherent in this Narrative. Rooted in righteousness, the Narrative cannot be questioned. Action taken in accord with this Narrative is self-evidently correct – any failures are anything less than success is due to the perversity of individuals (like the homeless in New York who froze to death due to the Mayor’s “compassionate” new policy).

As the Singaporean scholar and politician, Eugene Tan, has pointed out, successful community action is tied to its Narrative. The community’s Narrative tells the community what it can do and what it can’t. If the purpose of a community is to provide an acceptable quality of life to its members, then which Narrative is most likely to be successful?

Numbers don’t lie. How many have come to America to achieve the American Dream – to improve the lives of themselves and their families. How many have left those communities whose policies are rooted in the second Narrative? Ultimately, Nihilism can’t win. We can only hope that this seond Narrative – rooted in Despair – will eventually return to the dustbin of history.

========

I’ve been a rather poor correspondent so far this year. My book writing and travel and now surgery on my knee have been obstacles. I am working on two new posts: one on AI the future of work, the other on a community’s adaptive capacity.

Thanksgiving

Duty, Honor, Country — motto of the US Military Academy

Those of you who have had to listen to my [often] interminable war stories know that I was an – indifferent – soldier. In spite of that, I have always had the utmost respect for those who have made the military their career. That is especially true for those who accept and try to live up to Duty, Honor, Country.

Duty bespeaks their commitment to service, and their acceptance of the responsibility for that service. Honor means that they carry out their duty to their Country with integrity and faithfulness. It also signifies that they have a code of living, a set of standards that that they try to live up to. Simply put, they try to do the right thing even when no one is looking.

Sadly, it often seems that Honor is no longer valued in our world. Many who try to live up to a set of standards see those standards – indeed, any and all standards – demeaned as old-fashioned and of no use in the modern world. The honorable are seen – even derided – as anachronisms; curiosities from a bygone age.

And yet, at this time of year we see the volunteers loading boxes with toys for children who otherwise wouldn’t have any. We see ordinary people serving meals to those without family in soup kitchens and church basements across the country. We see the Salvation Army’s bell ringers collecting money for the Army’s shelters and other services.

We see these ordinary people, and we recognize that they, too, are abiding by a code. They, too, are serving, with fidelity. And if they, too, had a motto, it might be:

Duty, Honor, Community

Yin and Yang

The essence of Yin and Yang centers on the tension between two halves of a whole that are both divided and connected. – Angellia Moore

A few thoughts on “opposites” …

• This Chinese ideogram represents crisis. It is often misrepresented as a compound of “danger” and “opportunity,” but, in fact, that is the nature of a crisis. Crises are tipping points – the danger is that we fall into the muck. But they also provide us with an opportunity to become stronger.

We have seen examples of this in communities. Charleston and the SC Low Country was devastated by Hurricane Hugo. But out of Hugo’s damage rose a revitalized downtown with new amenities – the Aquarium, parks – and a new spirit.

• Scott Manning – one of the sharpest people I’ve ever encountered – recently reposted a note about the limitations of most studies of disasters. The note pointed out that too often they focus on the successes and failures of standalone events. His point is that we need a more integrative approach.

And he’s right. But I would also go a step further. Currently, we treat community development and community resilience (writ large) as two separate entities. Yet both are focused on strengthening the community. Both require investment and community attention. If successful, both increase a community’s adaptive capacity. But in practice, they seem to be at odds. To me, the synthesis of these not only makes sense but ultimately is essential if our communities are to Win Tomorrow.

• Charlie Kirk’s murder has brought out the best and the worst from both Left and Right. Kirk was a smiling Socrates, puncturing ideology-inflated beliefs. He was sometimes smug, sometimes condescending (and often annoying!) but – I believe – sincere in his beliefs, especially his faith.

On the Left, Bernie Sanders made an excellent video deploring political violence. But the celebrations of Kirk’s killing in the social media feeds from so many on the Left were disgusting. Similarly, the calls by some on the Right to doxx some of the worst offenders on the Left were equally disgusting. We can’t fix intolerance with more intolerance.

• One essential difference between “liberalism” as she is today and “conservatism” is their differing views of mankind. Most liberals (at least the ones I know!) have this view of mankind as a sort of tabula rasa, waiting only to be filled with good and right opinions leading to good and right actions. “Good and right” is determined by reason, and there is this optimistic belief of a sort of spiralling up as we gain more knowledge, ever redefining “good and right.” This leads to naive constructions such as native Americans as Noble Savages, and “mostly peaceful demonstrations,” and our rights are given to us by the law.

Conservatism, however, views humans as inherently flawed. We humans seldom behave rationally (although we rationalize a lot!). Though each of us may rue the fact, emotion and our subjective values drive most of our actions. I think there is also an echo of “history rhyming” that runs through conservative thought – that we can use our history as a guide for future action. I believe it is in this way we should understand the wisdom of Edmund Burke: society as “a partnership not only between those who are living, but between those who are living, those who are dead, and those who are to be born.”

• A personal problem. I am as close to a First Amendment absolutist as you’re likely to find. Although I’m not religious (I don’t believe in Church-ianity) I respect those who are. That means that I’m against any repression or persecution of those of faith. Catholic organizations should not be forced to pay for abortions or birth control, IMO. Sincere evangelicals should not be forced to support gay marriage, IMO. Sincere people of faith should not be forced to do anything that violates their faith – full stop.

But here’s my dilemma. If we can “make no law prohibiting the free exercise” of religion, how can we stop the barbarism of genital mutilation by Muslims? How do we stop the abomination of Sharia Law being imposed in any community where Muslims are a majority?

Of course, our Founding Fathers never conceived of an America that was anything but Christian. The virtues inculcated by their Protestant forebears were embedded in the social contract that is our Constitution (Of course, many of those virtues are now under attack under the anathema of “White Privilege”). But Muslims come from very different cultures. While Christian faith communities are no longer trying to eradicate each other (at least in the West), Shia and Sunni are still at war with each other in many places, as well as killing Christians.

The only way I can resolve my dilemma is through visualizing a Yin and Yang. Yin is moral law, establishing what we must be and do as a good person, i.e., inner-directed. Yang is Man’s law regulating our dealings with each other – protecting the weak, establishing equality under the law, i.e., outer-directed. As Moore’s quote indicates, there is a natural tension at the boundary between Yin and Yang. It’s where my dilemma resides.

More importantly, however, the whole – Yin and Yang together – is greater than either by itself. Their tension forges a society of good people doing the right things by each other. Without Yang, we get the barbarism I abhor. Without the Yin, we get ever-changing laws without a firm basis, reflecting the whims of whoever is law-giver that day.

This is a little philosophical for a Friday afternoon, but I’m afraid it is an uncomfortable reflection of what we are becoming in the Western world. Our moral compass is becoming more and more demagnetized – many of us are having trouble finding the “True North” to guide our conduct. Without that compass, then our rights will be guaranteed to us only by the Law (h/t to Senator Kaine), changing whenever the law changes.

We see this already in the British laws censoring free speech, and allowing Muslim “grooming gangs” to harass (and much worse) young British women. We see a manifestation of this in the US, where a judge gives an attempted-assassin a slap on the wrist because he/she is gender-confused.

Without the union of Yin and Yang, there can be no real basis for a community. Instead, you have groups of individuals with no purpose greater than competing for power. What one builds, the other tears down. As difficult as it is, we must restore the creative tension of Yin and Yang to save our communities.

Global Hints about Community Resilience

Long is the road to learning by precepts, but short and successful by examples. ~ Seneca the Younger.

I am an unrepentant data geek. One facet of my geek-ness is that I am autodidactic (I actually had a Professor call me that – I had to look it up) – I seldom accept others’ conclusions; I have to see for myself (actually, the Professor said I had to learn from my own mistakes, which I sometimes do). About 10 years ago, I first stumbled over FM’s Resilience Index. Now in its 12th year, it is a composite of 18 different indicators.

I posted about it at the time; lots of graphs, but I didn’t really put them into a useful context. In this post, I want to take a look at hints that they may have for those of us trying to understand a community’s resilience, in particular factors that we should consider in the resilience indices so prevalent in the literature and in use in the US.

The variables. FM is an insurance company. So “resilience” has to do with physical phenomena – natural hazards and climate change, as examples. It bins the 18 variables included in the Index into two categories: Physical factors and Macro factors. The Physical factors, in effect risk factors, rely on FM’s experience in each country, except for the cybersecurity data. The Macro factors might be considered as those attributes related to recovery from a natural disaster, i.e., resilience factors. If you’re interested in the data sources and methodology, follow this link.

Whenever possible, the data are averaged over a five-year period. This is something that is generally not done for most (any?) of the US resilience indices. The advantage of this is that it smooths out some of the inevitable noise in the data while maintaining evidence of a significant trend.

All of the Macro factors that involve money are adjusted for Purchasing Power Parity (PPP). The intent is to remove cost-of-living differences from comparisons. For the most common resilience indicator systems in the US, this has not been done. Thus, California counties (or other units) are indicated as more resilient than they really are because important data such as median household incomes are not adjusted for the very high cost of living (CoL) in CA. Using poverty values not adjusted for CoL, the number of people living below the poverty line in CA is less than the US average. However, once the value is adjusted, California has the highest fraction of its population living in poverty of all the states. In this context, it’s not surprising that it’s taking so long to rebuild Pacific Palisades!

Physical factors

Climate risk exposure – the portion of the country’s economically productive area exposed to climatic risks today.

Climate change exposure – the portion of the country’s economically productive area exposed to climatic risks in 2050.

Climate risk quality – enforcement of building codes for wind (90% of the indicator), and mitigation of flood and wind impacts.

Seismic risk exposure – the portion of the country’s economically productive area exposed to seismic risks.

Cybersecurity – commitment as shown in action (80%), and risk reduction relative to risk.

Fire risk quality – enforcement of fire codes (80%), and risk reduction relative to risk.

I haven’t seen the proportion of economically productive area to determine exposure to hazards used before. In the US, we either don’t include exposure data in our resilience indices, or else use something like the HAZUS code to calculate hazard losses (as is done for FEMA’s Community Resilience / National Risk Index). We certainly don’t include projections of risks in the year 2050. We also don’t include fire risks to the built environment as is done here, nor effectively give credit for mitigating actions.

Macro factors:

Control of corruption – perceived amount of corruption (public resources used for private gain) as well as “capture of state by elites and private interests.”

Education – average of expected years of schooling and the mean of actual schooling.

Energy intensity – energy consumption divided by the adjusted gross domestic product.

Greenhouse gas emissions – emissions divided by the adjusted gross domestic product.

Health expenditure – mean expenditure on health per person, both public and private, adjusted for PPP.

Inflation – annual rate of inflation.

Internet usage – fraction of the population using the internet.

Logistics – how easy it is to export to a target country in terms of the quality of infrastructure, the quality and availability of logistics activities, and public sector bottlenecks; based on survey data.

Political risk – perceived likelihood that the national government will be either destabilized or overthrown, either unlawfully or by violence.

Productivity – GDP (adjusted for PPP) per capita.

Urbanization rate – on an annual basis.

Water stress – freshwater withdrawn as a fraction of available resources.

Each factor was statistically massaged so that they were on a common scale (0-100). The resilience index for each country is then the mean of the 18 values. In contrast, in FEMA ‘s resilience index, the exposure (calculated via HAZUS) is divided into the Macro factors.

I took this data and mapped each factor against the resilience index and against each other. I won’t clutter this too-long post up any further with a bunch of graphs. The results are summarized in the following table where I’ve looked at correlations among the variables. R2 is a measure of how well two variables are linearly correlated. I’ve arbitrarily chosen an R2 value of 0.5 as the threshold indicating a strong relationship. All of the strong relationships are listed in the table below. If anyone wants the complete set of correlation just let me know.

Strong relationships R2 ≥ 0.5
Resilience indexControl of corruption0.76
 Climate mitigation0.74
 Productivity0.70
 Education0.70
 Logistics0.66
 Fire mitigation0.65
 Health expenditure0.57
 Internet usage0.57
Productivity (GDP per capita)Control of corruption0.65
 Logistics0.60
 Climate risk mitigation0.57
 Health expenditure0.53
 Education0.52
 Fire risk mitigation0.51
 Internet usage0.50
Health expendituresClimate mitigation0.56
EducationInternet usage0.68
 Climate mitigation0.57
 Fire mitigation0.52
 Urbanization rate0.51
 Control of corruption0.51
Political riskControl of corruption0.55
Control of corruptionLogistics0.66
 Climate mitigation0.54
Urbanization rateInternet usage0.52
LogisticsFire mitigation0.63
 Climate mitigation0.57
Climate mitigationFire mitigation0.73
Climate risk exposureClimate change exposure0.50

The strongest correlation was between the resilience index and control of corruption. This factor is not considered in any of the commonly used resilience indices. In effect, we are ignoring the community’s governance/institutional capital as a factor in its resilience. The impact of official corruption on recovery from disaster is obvious. The news from Gaza bombards us daily with a reminder of how much corruption hinders recovery. And apparently misuse of $100 M in recovery funding is another factor hampering the Pacific Palisades recovery. The only index that considers this factor is Arup’s resilience index for the 100 Cities initiative. Based on its strong relationship to a country’s resilience, this factor deserves more attention. (As an aside, I compared FM’s “Control of corruption” data with the Corruption Perceptions Index from Transparency International. The two are determined rather differently; however, they are highly correlated R2 = 0.96, i.e., they apparently are reflecting the same thing!).

Logistics, internet usage and fire risk mitigation are all important factors strongly related to both resilience and productivity. None of them are currently included in common resilience indices. I have often said that resilience is a manifestation of a community’s strengths, not its vulnerabilities. Intuitively, the ability to move physical assets where they are needed is an important strength related to recovery. In a similar sense, internet usage facilitates movement of information across the community. More generally, this emphasizes the importance of dispatchable capital.

One surprise: exposure factors weren’t correlated with the corresponding “quality” factors, i.e., mitigation wasn’t related to exposure. While the two climate exposure factors were correlated, none of the exposure factors were correlated with any of the resilience factors. Similarly, greenhouse gas emissions were not correlated with any of the other variables.

This is the first time that FM has included cybersecurity. It doesn’t make any difference to the resilience index, and is not correlated with any of the other factors. It seems to be irrelevant to both resilience and natural hazards and fires.

There is a lot more that can be extracted from this data, but this post is long enough already. FM has provided a rather different window on resilience, pointing out the importance of variables not often considered when we look at our communities. I hope that those working to make their communities more resilient will include all of the community’s capital portfolio in their efforts – its logistics systems (physical capital), its information systems (social capital), and above all, how the community makes and implements decisions (governance/institutional capital).

Another Minsky Moment

Stability leads to instability. The more stable things become and the longer things are stable, the more unstable they will be when the crisis hits. ~ Hyman Minsky

As Dan Alesch has pointed out, we designate disasters by their triggering events, but we remember them for their impacts.  Thus, we know Camille and Katrina and Sandy and Maria and Ian by the devastation they created; had they exhausted their energies over the Atlantic, their names would be forgotten.  In years to come, COVID-19 will cause all of us to shudder, even though we’ve experienced many decades of influenza outbreaks. And it will be hard to forget the 100+ lives lost this week in Texas – “Guadalupe” and “Kerr County” will trigger those memories.

But why were these disasters so impactful?  And, for all of them, why were there such great disparities in those impacts, even among neighboring counties and communities?  My answer – Minsky Moments.

A Minsky Moment is a crisis paradoxically born of stability (It takes its name from Hyman Minsky and his financial instability hypothesis, quoted above).  Minsky believed that a long period of stable financial markets led to ever increasing risk tolerance (and often risk-taking) which in turn led to a sudden collapse in the market.  His ideas have been used to explain both the crisis in Asian markets in the late 1990’s and the Great Recession that we have so slowly climbed out of.

A sad pattern seems to be all-too-frequently repeated. We take action immediately after a disaster and then as its devastation slowly fades from our memories we become more and more tolerant of risk and eventually engage in increasingly risky behavior. Almost invariably, this leads to a Minsky Moment.

For example, the hurricanes in Florida in 2004 and 2005 were the first major storms to hit south Florida since Hurricane Andrew in 1992.  Individually, each was weaker than Andrew, but collectively their impacts were much greater (For example, Wilma – a Cat 3 hurricane – did almost as much damage as the Cat 5 Andrew even after Ivan and Charley had already done so much.).  Over time, people forgot Nature’s devastation – many let their insurance policies lapse; many didn’t properly protect their homes; virtually no effort was made to strengthen buildings built prior to the more stringent building codes put in force after Andrew.  People became so risk tolerant that even common sense precautions (such as properly functioning storm shutters) were ignored.

Craig Colton has pointed out that this behavior happened in New Orleans after Katrina as well.  Homeowners bought insurance in almost record numbers in 2005 and 2006; by 2009, many of those policies had been allowed to lapse.

A very different type of event – a school shooting.  We were all horrified in 2015 by yet another scene of senseless violence, this time at Umpqua Community College in Roseburg, OR.  But the fact that there had been a deadly shooting at Roseburg High School in 2006 was lost in the tragedy of the event.  Clearly the quick response of the police indicates that they, at least, remained highly aware of the risk, but it appears that the leadership of UCC was ill-prepared.  And being unprepared for this kind of an act on a campus in today’s world means that the risk is tolerated and, unfortunately, accepted.

Similarly, even after the devastating effects of the coronavirus in China became apparent (in spite of the Chinese government’s efforts to hide them) in January, 2020, the President and many governors and mayors tried to downplay its potential impacts.  People were encouraged to “party hearty” – Chinese New Year, Mardi Gras and others.  Spring Breakers beached it even into March, and for some, sadly, it was their last Big Wave.  We had not had a major epidemic in 100 years; the false alarms of the last two decades (SARS, Ebola, et al.) conditioned us to believe that the party would never end – until it did.

And just this week, the tragic deaths of campers, and many others, in Texas. The “We can’t afford a warning system” thinking; the “The water in that creek is only a foot deep or so – it won’t flood” mindset; the “We haven’t had a big flood since 1987” excuses led to so many lives wasted.

Perhaps the most touching were Blair and Brooke Harber, two sisters who along with their grandparents, were swept away by the flood. The love of those two sisters – so strong that even the powerful surge of water could not prise their hands apart – is matched only by the weak judgement of the adults who failed them.

Sadly, there can be Minsky Moments in any and every aspect of our lives.  Certainly AIDS took so many lives in the 1980s because of the risk tolerance and risky behavior that were the hallmarks of the sexual revolution and drug use in the ’60s and ’70s.  We had conquered polio in the ’50s; antibiotics seemed able to cure even STDs; there was no real risk – or so we thought.  And yet a virus that apparently had been lying in wait since the ’20s pounced on our risky behavior to become a pandemic. Polio and measles – evil genies we thought we’d eradicated – are again emerging as real threats.

The levees of the Sacramento River Valley provide the basis for a potentially devastating Minsky Moment.  Originally built to provide water for reliable irrigation of farm land, the levee system has led to unrestrained development.  This residential and commercial development is occurring in an area that has seen at least six massive floods (When Leland Stanford became Governor of California, he had to use a rowboat to get to his inauguration.). When the levees breach (one estimate indicates a 64% chance in the next third of a century), the drinking water for 25 million people will be contaminated, millions will be left homeless and tens of thousands will die.  All because we have forgotten the lessons of the Great Mississippi flood of 1927 (John Barry’s Rising Tide provides an excellent explanation of how bad management and engineering contributed to this event. His The Great Influenza is also an excellent reference on the Spanish flu pandemic.).  Similarly, had we remembered the lessons that Nature tried to teach us with the Long Island Express of 1938 (a massive meat cleaver – compared to Sandy’s butter knife – that carved up the Long Island Sound) much of the devastation of Superstorm Sandy would have been avoided.  While some communities had wide beaches and recently constructed berms and dunes that protected them from the worst of the storm, many more of their neighbors went unprotected into that good night.  And those still rage over the blight that is strangling their communities.

In too many cases, the impacts caused by extreme events – especially the human suffering – can be attributed to Minsky Moments like these.  It is all too human to want to forget the bad things that have happened to us.  It is all too human to believe that since no crisis has happened recently, none lies lurking in our future.  But we must go beyond our human failings – we must ensure that fading memories do not give rise to tolerance of risk, then risky behavior, and then the inevitable Minsky Moment. Or else more young voices will go silent, more precious lives will be lost.

Freedom For

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — Declaration of Independence

Happy Birthday, America!

Today we celebrate our Founding Father’s act that signified the birth of our Nation. Gathered in Philadelphia that July in 1776, they signed what has become a quintessential statement of men’s right to be free.

Many today are focusing on that Freedom as the basis for American exceptionalism. But I find that incomplete. What makes America truly exceptional is not Freedom per se – other nations have been and are free. Our exceptionalism is in the aspirational nature of the Declaration of Independence and of our nation. We are the only ones who have a Dream. It is that aspirational nature of our society – the “pursuit of happiness” as Jefferson put it – that sets us apart. And that we must safeguard.

That means that we Americans not only have freedom “from” as many other nations do, but freedom “for.” Our Founding Fathers were rightly aware that Freedom without restraint becomes License. Baked into the Declaration and many of Lincoln’s most famous speeches (as well as Franklin’s “a republic, if you can keep it”) is the notion of Responsibility – Freedom’s homely twin. As Americans, we have a responsibility to those who came before to safeguard what they have bequeathed us. And we have a responsibility to those who will come after – to ensure that they viscerally value what we bequeath to them. Thus, the American Experiment is (to borrow from Edmund Burke ) a partnership “between those who are living, those who are dead, and those who are to be born.”

Our “Freedom For” is thus part of a social compact between ourselves and our communities. We are free to pursue our happiness but have a responsibility to our community as well. First, do no harm – the Hippocratic Oath applied to our civic life. Don’t litter; don’t commit immoral acts; don’t make the commons a tragedy. And then make the community better. Not in a performative way (what did “No Kings” accomplish?), but by taking positive action. Picking up the litter or helping those who are in need. As de Tocqueville observed, that sense of community is also a part of America’s exceptionalism.

Like so many of you, tonight I’m going to see the fireworks and celebrate with family and friends. I will celebrate – in my Freedom to act and think and write – America’s exceptionalism. And in the days to come I will continue to work to make my community an even better place to live. That compact between me and my community is also part of America’s exceptionalism – it’s what gives me my “Freedom For.”

It began with a bull

…and a community mired in poverty…and a stubborn man who cared enough to do something about it.

The following is based on a nifty little book by Vaughn Grisham and Rob Gurwitt called Hand in Hand. It provides more detail about Tupelo’s economic and community development and is well worth reading in its entirety. I’ve added details that reflect the city’s further progress after the book was written.

In the 1930s, Tupelo, in Lee County, MS, was an economic basket case. Its economy (primarily agricultural, mainly relying on cotton) had been devastated by the Great Depression of the 1930’s, a killer tornado in 1936 (230 died in the county), and the ravages wrought by the boll weevil on the cotton fields. The hub of one of the poorest counties in arguably the poorest state in the nation, a majority of its population were below the poverty line. Tupelo was rather isolated – with few roads and no nearby waterway; it had no amenities to foster tourism; it had no mineral resources (and severely depleted agricultural land!); it had no nearby federal installations to act as a center of growth. Today, Tupelo is the center of a thriving economic and educational ecosystem. And this amazing turnaround, this transformation, began with a bull.

Prior to World War II, city leaders had tried to improve Tupelo’s economy several times. These efforts had been haphazard and without lasting success; even the city’s electrification had had little impact. However, these efforts had shown that the fate of the city and the rural areas around it were highly intertwined. City businesses had little chance of growing unless their poor rural customers had more money to spend.

As early as 1936, the owner of Tupelo’s newspaper, George McLean, had begun editorializing that the city’s best chance for growth lay in lifting the poorest out of poverty. He expressed the belief that if the “haves” in town invested in the “have nots,” the return could be tremendous. And like all good prophets, he was ignored –  at first.

Previous efforts to help the farmers had focused on diversifying their crops. What little success that had been achieved disappeared into the Great Depression. McLean and a few other forward-thinkers in the town visited several ag schools across the region and beyond to develop a new and more lasting approach. They concluded that if farmers could turn to dairying (in addition to cotton if they wished), they could greatly improve their economic condition. Instead of a single payday when they brought in their cotton crop (and living on credit much of the rest of the year), they could have a steady income from selling their milk every day or so.

Great idea! Except … a successful dairy farm requires quality milk-producing cows. By and large, the poor farmers’ cows weren’t good milk producers. A good bull was needed to provide better milkers. George and a few others then began a campaign to buy a bull. They eventually pestered persuaded nearly every business in town to contribute. They went to the Isle of Jersey to buy the best bull they could find. They hired a dairy expert to provide advice to aspiring dairy farmers. For $5, any farmer within a 33-mile radius of Tupelo could have his cow mounted. The first year, only 150 cows were bred, but results seemed promising. The second year 1100 cows were bred, and the total kept going up – the farmers were making money!- In fact, the demand became so great that McLean and others started a foundation to support an artificial insemination program, and bought a world champion bull. By the end of the decade, dairying was pumping over $27 million (2025) dollars into Lee County’s economy.

But that success was only the start for McLean and other business leaders. McLean in particular believed that a community’s sustained vitality required not only increased financial capital but the other forms of community capital as well – better infrastructure, better schools, closer ties between town and the surrounding county. McLean and the other community leaders concluded that achieving all of this was beyond the scope of a Chamber of Commerce but did need to be institutionalized.

This led to the formation of Tupelo’s Community Development Foundation (CDF) in 1948. Eight-eight business leaders were involved in the planning. In its first year, 151 founding members contributed over $25,000 to get it started. It has held fast to McLean’s original belief that investments by the “haves” in the “have nots” pay big dividends. However, it has not remained static in its vision. Every decade the CDF has moved its aim point in response to the city’s development. In this table, some of the returns on those investments are detailed.

CapitalAccomplishment
PhysicalPrepared report for legislature which averted water crisis by using Tennessee-Tombigbee Waterway as source of water Encouraged development of four-lane roads to facilitate rural access to manufacturing facilities
HumanPartnered to form adult literacy program Partnered to provide free tuition to local community college to all Lee County high school graduates Partnerships to advance education in STEM disciplines with TVA and IBM Brought a branch of the University of Mississippi to Tupelo
GovernanceInstrumental in formation of Council of Governments for the county Developed Community Leadership Institute Fostered alliance between Pontotoc, Union and Lee Counties (PUL Alliance) for economic development Guided development of city strategic plan focusing on attraction and retention of talent and on improving the city’s quality of life
FinancialAided Lee County to climb from 10th to 1st in the state in terms of manufacturing jobs Played major role in establishing city as a major hub for furniture manufacturing As part of PUL Alliance, captured Toyota manufacturing facility (2007) Impacts of Great Recession less than those nationally, with quicker recovery
CulturalGuided formation of United Way of Lee County Recognized five times as an “All American City” Forged culture of accomplishment and openness to new ideas and people
SocialBuilt linchpin connections between city business community and rural surrounding areas

Today this revitalized city is the home of two regional banks, a Baldridge award-winning hospital, and a thriving regional automotive industry. Its poverty rate is below the national average. Tupelo’s per capita and median household incomes are about 40% higher than the rest of the state and above national averages. Its unemployment rate is about two-thirds the national average and 58% of the state as a whole. And to think this amazing turnaround, this transformation, began with a bull.

The book on which this is based has an excellent table that sums up the “guiding principles” by which the CDF operates. These are explained fully in the book but they’re worth listing here.

• Local people must address local problems.

• Each person should be treated as a resource. The community development process begins with the development of people.

• The goal of community development is to help people help themselves.

• Meet the needs of the whole community by starting with its poorest members, not just as targets for top-down efforts but as full partners in helping design those efforts.

• Community development must help create jobs.

• Expenditures for community development are an investment – not a subsidy – and will return gains to the investors. So people with money have both the responsibility and an interest in investing in the development of their own community.

• Community development must be done both locally and regionally if the full benefits are to be achieved.

• Start with a few tangible goals, and measure your progress in meeting them.

• Build teams and use a team approach.

•  Leadership is a prime ingredient, but community development cannot be achieved without organizations and structure.

• Never turn the community development process over to any agency that does not involve the people of the community.

• Persistence is essential, and programs must be continually updated.

Winning Tomorrow

Yesterday is not ours to recover, but Tomorrow is ours to win. — Lyndon Baines Johnson

As many of you know, I have spent much of my later-career years focused on communities, especially community resilience. The “resilience” that I and my colleagues have talked about goes beyond the conventional “bouncing back” from adversity – survival – to include seizing the opportunities inherent in any “change” whether adverse or not, i.e., thriving.

But this put us in a somewhat awkward position: virtually all of our funding was coming from sources most interested in “surviving” crises. If you think of the Chinese ideogram for crisis, it is made up of the symbols for “danger” and “opportunity.” Our funding tended to focus us on mitigating “dangers” and on recovery when they overwhelmed communities, with much less attention to seizing opportunities.

Now that I’m self-funded (ahem), I’m trying to bring balance back into my own thinking and writing. As a part of this, I’ve struggled to find something that better captures our conception of “resilience.” If the purpose of a community is to provide the quality of life that its members want, then a community should be continually striving to meet or exceed that goal. I was searching for a way to express that idea when I stumbled across the quote for President Johnson. 

Winning Tomorrow – the American Dream for communities! The American Dream is the essence of what makes America exceptional. It is inherently aspirational. It is built on a belief that anyone – even the poorest among us – can rise above even the humblest of beginnings to achieve a better life with hard work and persistence. Just as we as individuals work to make the American Dream a reality for ourselves and our families, our communities should work to make themselves better, more livable, places to work, play, and raise a family – they should aim to Win Tomorrow.

Certainly, achieving that purpose is complicated by the sea of changes in which our communities are immersed. Winning Tomorrow means that the community will continue to move forward no matter what challenges they face in the future. Communities are open systems. People are moving in and out of them continually. Today’s acceptable quality of life may not satisfy the community’s residents 10 years from now. Neighboring communities will also change. The community may be struck by a Wild Thing, resulting in loss of life, in damage to infrastructure, or to businesses closing. The state or federal government may enact new regulations altering community processes. And, of course, the community’s infrastructures and dispatchable capital will degrade over time if not maintained.

A community Wins Tomorrow if the community’s quality of life steadily improves over the long term. The community successfully adapts to its stressors before failure occurs. If the community fails (e.g., if it is devastated by a Wild Thing), it rapidly recovers, and regains its upward momentum.

It takes self-investment to Win Tomorrow, but that doesn’t mean mountains of money. It does mean institutional capital to make decisions and to implement them; human capital to take action; and social and cultural capital to sustain the effort.

Some of you cynics may scoff at this: “Mine is a poor community with few resources.” The American Dream doesn’t care where you start, or how poor you are. If you work hard and smart over the long haul, you can create a better life. In the same way, even the poorest of communities can Win Tomorrow, using what they have to take small steps that become bigger steps that ultimately become transformative.

In that sense, Winning Tomorrow is a journey, not a destination. It is not a one-time exercise but rather a continuing effort to make Tomorrow better than Today for the entire community. Efforts to Win Tomorrow should last for decades – ideally never ending. Winning Tomorrow mostly consists of incremental changes to individual community systems.

I know this may seem like what my good friend Warren Edwards calls the “Square Root of Ether” – an intellectual exercise with little practical merit. In my next post – It Began with a Bull – I’ll tell the story of a dirt-poor community who started its journey with nothing but a leader who cared about his community and the community is still working to Win Tomorrow.

Competence and character

Trust is a function of two things: character and competence. Character includes your integrity, your motive and your intent with people. Competence includes your capabilities, your skills and your track record. Both are vital. – Stephen Covey

In response to my last post, one of you asked a really good question – “How do we get competence AND character in our elected officials?”

I [tried to] provide a brief answer in the last post:

If what you see doesn’t match what you’re being told – by either the politicians or the media – then suspect you’re being lied to. Dig at it until you get at the truth – and then act on it. Most importantly, don’t vote based on loyalty, or to just go along – vote for who is going to do the best job. If they don’t live up to your expectations, vote them out. And if none of that works, then vote with your feet – leave.

So let me personalize this. I vote for the candidate that I most trust to do the things that need to be done. Too often, our elections become a referendum about one candidate or the other (arguably, 2020’s Presidential election was a referendum on Trump). But elections actually are choices. A vote against a candidate is a vote for their opponent. If we vote for someone because we dislike/loath/hate their opponent we may well get what we deserve – an incompetent with little integrity.

That skeletal bone “the things that need to be done” demands a bit more meat. The first duty of community office is to maintain or improve the community’s quality of life. Ideally, that means finding people who will “do the right things right the first time.” Finding people who will not only work to solve Today’s problems but are also focused on Winning Tomorrow – a sustained effort to improve the community’s capacity and its quality of life (I’ll talk more about Winning Tomorrow in my next post). But we’re all flawed; there are too few of these paragons around.

Thus, one way to get competence and character in office is to urge those we believe approach this ideal to stand for election. I judge a candidate’s competence based on

  • The candidate’s past. Does the candidate meet the requirements for the position (e.g., age, experience, education)? If the elected position requires working with a bureaucracy, does the candidate have any relevant experience? Has the candidate handled difficult situations before in an acceptable manner?
  • The candidate’s positions. Is the candidate focused on solving what I believe to be the community’s problems? Which of these are the candidate’s highest priorities? Is the candidate offering likely solutions, that won’t have any obvious “unintended consequences?” Is the candidate driven by ideology or by observation of the community’s conditions?
  • Tenure. Has the candidate (or the candidate’s party) held the office for longer than a decade? If so, what does the candidate propose doing differently to solve the community’s problems?

I judge a candidate’s character based on

  • The candidate’s past. Any scandals, or anything unsavory? If it’s something said or written in the candidate’s youth, has the candidate learned and moved beyond the immature transgression? Conversely, are there laudable actions or statements (e.g., serving one’s country)?
  • Confidence. Is the candidate confident – neither cocky nor projecting mock humility? When confronted by those who disagree, does the candidate “keep their cool?”
  • Trust. Do I trust the candidate to do their best in the position? This is a personal thing: the person’s confidence plays a role, as does the candidate’s respect for those who disagree. Ultimately, I’m looking for that person who, if necessary, will “rise above principle to do the right thing.”

The crucial element is information. Correctly judging a candidate’s competence and character requires accurate – and often nuanced – information. As a result, I spend a great deal of time before an election seeking information about the candidates in the races I care about. I try to glean information from several sources to construct the best picture I can. As an aside, the consolidation of the media often makes that difficult. We often overlook that the news media are both reporters and curators. If they choose not to cover a story (e.g., Hunter Biden’s laptop; JFK’s infidelities) then we as citizens are denied the ability to factor it into our decisions. The rise of the “New Media” such as the Free Press (left of center) and the Daily Wire (right of center) is helping to restore balance at the national level. But while there may be multiple sources of information in some of our big cities, in many locations – especially smaller cities – there often is only one.

Once I’ve collected the information, it’s crunch time. Remember, elections aren’t referenda, they’re choices. And since we’re all flawed, it’s highly likely that each candidate has pluses and minuses. I look for the candidate best able to get the things done I believe desirable under the circumstances.

We can’t always have both competence and character. In one of the first elections in which I voted, I was faced with the choice between a competent (possible) crook and an (apparently) honest fool. I voted for the crook because he seemed best able to make and implement the hard decisions demanded by the times.

If we want both, we have to urge competent people of character to run for office. But – like us – our information will always be flawed. We will make mistakes. The easiest is to simply vote straight party tickets, as if one of the parties has a monopoly on mendacity and the other lives close to the saints. If we vote for the candidate and not the party; vote for what we believe is needed for our communities to survive and thrive; and dig for the information we need to do these – we likely won’t go too far wrong … at least not very often!