Introducing Transition Economics
Transition Economics (TE) is a new econometric science. Economics is old and theoretical, where TE is new and scientific. TE deprecates Micro and Macro economics, replacing a subjective theoretical approach (with a track-record of 70%-collapse-trending nations today), for a transparent policy-driven approach that is proven to build sustainable societies and advancing economies reliably
Economics is not a science today. If Economics were a science, could we all live in the prosperous American Dream of the 1960s sustainably, without social problems and wars? The correct answer – is Yes. Consider that America built the strongest economy in history while living in an unprecedented high-Social-Contract society – back in the 1960s. Today, Norway, Ireland, and the Netherlands have strong economies and high social contracts despite a global mature capitalism today. Clearly a solution of policies exists for any economic era and condition
Casinos, are widely regarded as fail-safe businesses. This reliable success is based not upon winning every transaction, but rather on only permitting transactions that have a higher-percentage-probability for the house to succeed. Similarly, TE allows nations to choose policies that have a higher probability of creating an advancing economy and society.
TE’s Data Science surveys 1500+ indicators and indexes in 200 countries to validate causal and sustainable policies transparently. Mr. Dickens’ “Mankind is our business” is more than a moral platitude because high social-contract scores create strong national economies 100% of the time – in any era. We know this because we can prove it easily with TE
Bibles too, were written as textbooks to describe how to build sustainable societies – via proven laws and policies. Most of the Bibles’ policies of family values, respect – of community, neighbors, employees, living wages – along with most topics of social responsibility, are proven essential for sustainable prosperity
Making Economics a science is as important as realizing that most countries share the same unreported problems today. Right or Left policies are irrelevant; what is relevant is are policies sustainable ? Unsustainable policies collapse economies and societies reliably, the mature capitalisms they create are expensive, dangerous, and preventable, so any system of government, or voter, that supports or teaches these policies can be considered socially irresponsible
The first step in solving any problem is realizing you have a problem
When we don’t know what to stand for, we can fall for anything…
If you give any population one-million dollars each, sixty-years later you will have gross inequity. Freedom – in a monetary system, is your reliable Salaries minus Cost of Living (CoL); when Salaries fall to CoL, Freedom is lost. When Salary falls below CoL, Social Contract is lost and economies stall. When government policies permit monetary systems to collapse from this imbalance, countries descend into populism and create a powder-keg that any spark can then turn into world wars. There are, in fact, more conflicts in this current decade (2010-2020) than in any other decade in history – caused by the hardships and lost freedoms created by wealth and income inequity, starvation wages, and high costs of living internationally.
Transition Economic’s scientific Proofs and Social Contract Product (SCP) Report explain that strong social contracts build strong economies. Where GDP Reports hide social costs and allow Social Contracts and productivity to diminish, SCP Reports cast into sharp relief the high cost of unproductive populations. The SCP Report recognizes that there is a problem, so that a solution can begin. “End of War” explains the how; the project needed to correct unbalanced monetary systems country by country.
Prime Minister Jean Cretien accomplished the largest budget surplus in Canadian History – $1 billion in a single year. This is a reported statistic. Today, the Canadian economy loses close to $4.2 billion dollars per day to its falling Social Contract. This is an unreported statistic. Now, ask yourself does it make more common sense to drive austerity measures that will surely shrink a stalled economy further – but achieve a balanced budget, or is it better to drive SEED opportunity investment that has a track record of building a robust economy – and put a stop to the $4.2 billion dollar Social Contract Loss?
First you grow your economic “Pie” larger, and then you pay your bills with the considerably larger proceeds – or through debt forgiveness. 70% of democratic nations have had their national debts run up by the Reagan era’s unsustainable policy of “Low Tax”, so its probably a very good time to also discuss Debt Forgiveness as we did in the 1930s when near-every European country simply had their debt written down.
Capitalisms created strong Social Contracts better than state-owned productions after the fall of monarchies in the early 1900s. This is typically true early-on in a new monetary system’s lifecycle (from 1950 to 19o0 for example). But neither of these ownership-models support strong Social Contracts, as a monetary system matures into imbalance near the end of a cycle. At this point, active corrections are needed by Governements to rebalance an economy’s Salary to Cost of Living ratios, and create the opportunity needed to relaunch a new monetary system cycle once again.
Henry Ford invented not the assembly line, but the Living Wage – during the Second Industrial Revolution (1895-1930). Severe inequity had stalled world economies for fully two millenia in “Dark Ages|. A clear view of what inequity builds can be seen in any chart of 2000-year GDPs per Capita prior to 1890
Transition Economics manages Monetary System Cycles
Monetary system cycles begin balanced – and then they imbalance over time. Can an economy be managed to prevent imbalance? Yes; this is Transition Economic’s primary focus. Monetary system cycles – are manageable in two ways:
a) Governments can actively ensure that the ratio (balance) between reliable salaries and cost-of-living, stays in-balance annually. This is similar to CPI (Consumer Price Index) corrections but more sweeping to include all costs (housing , etc.) and salary levels.
b) Governments can simply allow open markets to unbalance themselves – and then, when social hardships become too great, the government of the day can reset the monetary system cycle to a new balance and a new cycle again.
The Code of Hammurabi and the Bible/Torah (Leviticus 25-26) suggested this second option in an era when monarchs had the authority to make sweeping economic resets easily. A fiftieth-year Jubilee Year was suggested to pre-empt the hardships of a mature monetary system’s 60-year cycle. “Reset” policies included: Universal Debt forgiveness, wealth redistributions, and a concerted effort to reset the balanced “American Dream” conditions that we should see at the beginning of any new cycle.
“25:10 Consecrate the fiftieth Jubilee Year and proclaim liberty throughout the land… 35. If any of your fellows become poor and are unable to support themselves among you, help them as you would a foreigner and stranger, so they can continue to live among you. 36 Do not take interest or any profit from them … so that they may continue to live among you. 37 You must not lend them money at interest or sell them food at a profit.”
Uncorrected, however, Mature Capitalisms are incredibly expensive; we see this here in Social Contract Loss reports to the left. GDP Reports completely hide the productivity losses created when 40%+ of an entire population experiences starvation wages. The average economy loses an unreported $4.3 billion every day today.
It’s a solvable problem; CSQ’s Data Research group builds MEMS for the exact purpose of correcting and turning around the specific policies responsible for this loss, and ACT Parties – do what FDR did …
FDR turned our last Mature Capitalism into the American Dream and greatest economy of all time, with policies of high wealth and income distribution (92% income and 80% estate taxes – for 20-years), nationalism, full-employment, an empathetic Second Bill of Rights and America’s mature and affordable home ownership system (a strong Social Contract). Eleanor Roosevelt carried these policies on to become the U.N’s Universal Declaration of Human Rights in 1948. Truman’s New Deals and Marshall Plan rolled this text into the constitutions of Japan, Italy, and Germany – which are the only three G7s with advancing economies today.
This will sound pretty intuitive and even obvious to most of us I think. The question for democratic law-makers and academics becomes, can the voices of special interests continue to successfully drive political messaging that misrepresents and even vilifies proven solutions? Invariably, it is the poor – and the economy – that suffers, Oligarchs are not personally impacted by their poor decision-making. For this reason, conflict of interests should be announced. Individuals with personal interests should disclose and exclude themselves from votes in support of their personal interests, or they should explain their policies as self-promoting Advertising or Opinion transparently – at the very least, so that voters can make their own calls about concerns for character and corruption
Where Economics teaches theory in how economies might work, TE teaches how they do work. Context-relevant data and mature infographic tools make it possible to model economies easily in just the past five years really. Where Micro and Macroeconomics are entirely theoretical and are also proven to fail (to not manage the imbalances of mature capitalisms, automation, nor expensive and dangerous collapsing Social Contracts). Transition Economics’ scientific approach teaches credible, quantitative, disambiguated terms and proofs that can ensure strong economies at any phase of a monetary system’s life-cycle
FDR’s Proven Success
FDR created the American Dream and greatest economy of all time – in a mature monetary system cycle very like today. Franklin Delano Roosevelt was President of the United States from 1933 until his death in 1945.
Advancing vs Collapse-Trending
“Advancing” economies can be confirmed using any four proven measures of an advancing economy. The term “Proven” here, means to say that the measur can be confirmed transparently, in TE Proofs (TEPs and cited multi-national surveys), to indicate a causal influence of economic success. Measures will grow with continued research, but most today’s frequently-used measures include :
(indicated as “Advancing” in TEP legends)
SCP over 5.5 (sometimes 5.8 – or similar)
Export – per Capita over $8000, or over 55% GDP
The value of Social Contract is there are no financial indicators in this index. There can be no biase in comparisons of trade metrics with this measure
TEP Sheets consolidate all TEP measures for all countries – per indicator. Charts on the right side of a sheet measure High Income Nations only
These measures cannot be used individually as yet – because internal measures of economy are subject to many influences. Housing Bubbles (Usury), Salary to Cost-of-Living Imbalance (Low Social Contract), and other unsustainable policies that create dystopic conditions and stall economies, also report positively in a GDP report. We see this in the “GDP – 2008 to Today” TEP Chart
GDP – 2008 to Today
Gross Capital Formation
GDP-PPP per Capita appears Causal but simple GDP surveys overlook dystopic conditions too. Suggest using this measure only in combination with a high High Housing Index score or high Top-30 Social Contract score
94% of High Income nations have unsustainable birthrates today, some very severely so – see Canada and Japan. Double Income Traps drive poverty, starvation wages, suicide and economic stall in addition to unsustainable fertility rates. In nations without stated goals to reduce population, encouraging Female employment appears socially irresponsible although some snapshot measures appear positive
Find a library of TE Proofs at the World at our Hands Report page
Left and Right Policy – and Late Capitalisms
Left and Right Policy is irrelevant; only sustainable and unsustainable policy matters. Unsustainable policy brings the additional difficulty that it shrinks economies and societies reliably, so whenever both Left and Right political parties present unsustainable policies, every vote becomes a socially irresponsible vote. We see this routinely in collapse-trending nations like Canada , Britain, and the U.S. during these several past federal elections.
In Late Capitalisms, FDR’s New Deal policies are proven to reset economies very successfully: Nationalism/Culture (Conservative), Full-employment (Conservative), Social Contract (Liberal), Empathy (Liberal), wealth and income distributions (Liberal), debt forgiveness (Liberal), living wages (Liberal), low cost of living (Conservative?), Single Income Families (Conservative) and accessible home ownership with a titling system that made “capital” available to everyone (Liberal). See CSQ Research’s ACT Party Canada, America, Great Britain, etc. website for an in-depth explanation.
FDR’s Second Bill of Rights explained this successful strategy in 1944 and the countries that had his rules added to their Constitutions after the war, still live the American Dream with some of the best economies per-capita in the world today – 70-years-later.
By the way, Social Contract is not Socialism (see a disambiguation here). Social Contract is what soldiers fight for – and died for, and there can be nothing unpatriotic about running sustainable policies that are proven to rebalance and turn-around mature monetary system imbalances. Find a list of top Social Contract nations on The SCP Report here.
Great philosophers and authors like Lord Byron, Tolstoy, Dickens, Rousseau, Hobbes, Orwell, Hugo, and many others, have described the dystopic conditions created in mature, unbalanced monetary systems – when policies like Low-tax, Small government, Open markets, Immigration, Middle-income, Laissez-faire, and low Death-tax (inheritance tax) – created dystopic living conditions and dark-age economies.
Climate and the Environment
Transition Economics was developed by an engineer who realized that climate problems are solved through both projects and in operations too. An ounce of prevention is worth a pound of cure, so the design of operations – in mining, forestry, manufacturing, and every other industry, must always consider Climate and Environment as fundamentally important. Heat can be beamed into space, air can be scrubbed, ozone can be produced, plastics can be cleaned from our oceans and beaches, and so on.
This being said, Climate is addressable AND it never created a world war before. Social Contract, alternatively, creates a powder-keg that has sparked to ignite a World War reliably – many times in history. By the timings of World Wars I & II, World War III (an extinction-level event) could commence between 2018 and 2028 – if Social Contracts are not rebalanced and tensions to not reduced peacefully.
As a priority, Climate and the Environment must take a distant second priority to Social Contract – especially in a mature capitalism like today. Fortunately, there is no reason why we can’t do two things at the same time. Anyone who tells you differently is no credible leader.
Large Democracies need FDR’s Social Contract in Constitution
Social problems are worse in large democracies (in populations greater than 15-million). The “FDR-Democracies” are a notable exception; these are the countries that added Roosevelt’s Second Bill of Rights to their constitutions after World War II. Today, all of these nations have advancing economies, great schools, great healthcare, six weeks vacation, and much lower taxes that the American private-insurance boondoggle. It’s also true to say that several modern monarchies are running more effectively than large democracies in today’s mature capitalism – in fairness.
The countries that lost the war, won the peace.
Adding to voter confusion is the fact that many Capitalist policies which worked well to monetize the enormous opportunity that was available early in a monetary system cycle, will reliably damage social contracts and economies later in the cycle. Today the U.S.’s policies cause it to lose $37 billion a day in exports, and there is nothing conservative nor pragmatic about failing to correct those losses and costs.
I mentioned above that today’s mature capitalism, was preceded by more than thirty previous recorded mature capitalisms. The Bible and Code of Hammurabi both discuss strategies similar to FDR’s and yet none of us were trained in how to manage our democracies in school. Without this Civics training in school, and with no understanding of how to build a sustainable society as explained in Bibles (since our schools turned secular), we must now struggle to understand how to vote to sustain our good lives, according to what we see on television. This education shortfall was irresponsible in any era – but in a mature nuclear age, it’s dangerous and impermissible really.
CSQ Research’s 16-week high-school Civics course, CSQ Common Sense 101 addresses this need and training curriculum.
When are new theories and sciences required?
“When observation shows phenomena that are absent in, or inconsistent with, available theories, Economic Theorists look for new theories.”
The American Economic Association website
Transition Economics falls into this category of new theory, and it is also new science too. TE targets proven economic building blocks like Advancing-Economy surveys, Causal Policy, Right Plans, and the democratic reforms needed to ensure economies maintain an optimal highest-probability-of-success globally. If current status-quo policies worked as theorized, surely America would be the strongest economy by a wide margin, and the international monetary system would not also be seeing a 68% collapse-trending rate across 200+ economies worldwide. Observation confirms that there must be a fundamental flaw in our current approach to Economics.
Transition Economics is a Science – and not “theory”. Where Micro and Macroeconomic theories fail observably, Transition Economics can prove decisions defendably by Scientific Method – in both observations and in statistics.
A new language is needed. Terms like Supply and Demand cannot be proven to create a successful economy, but Social Contract can. Terms like Socialism, Conservative, Liberal – ignore the Socratic Method’s best-practice of disambiguation. They mean as many as ten things, and seldom mean the same thing to anyone. Ambiguous terms need to be deprecated and replaced by disambiguous terms that can be proven or disproven.
Most “isms” are deprecated in TE due to this important need for disambiguation. Socialism – is not given eight meanings; we simply say Ownership of Production by the State, or reward of contribution, or public ownership of property, when that’s what we want to discuss – see a disambiguation of the term “Socialism” here. Meaningless “Conservative Policy” or “Liberal Policy” is redacted – and replaced with the terms “Sustainable” or “Unsustainable”. It’s not clear that Marxism, Liberalism, etc. are proven-failed fictions and so we don’t permit their misuse any longer.
Globally, the world stands at its highest debt levels ever; at its highest conflict-levels ever; populism, extremism, high suicide rates, homelessness, poverty, rent/mortgage/energy poverty rates, low productivity (in low social contract nations), crime, etc. 68% of nations maintain year-over-year negative trade balances and exports-per-capita shortfalls; $32 trillion sit in tax-havens as do many more trillions of dollars in negative interest-bearing bonds.
Current economic approaches, measures, and controls – therefore, require new theories. Economics is not a science presently – which makes it undefendable and requires new approaches that are scientific – as well.
Keynes’ explained that his brilliant economic theories were short-term, and today they stand as an example of theory proven to be unsustainable longterm by observation. Theory proven incorrect – is fiction – and yet universities the world over spin deep-dives into these micro and macroeconomics theories still. Worldwide banking and monetary system managers carry on with policies proven unsustainable and unscientific, recklessly and blindly reconstructing the dystopia and powder-keg that is an unbalanced global mature capitalism.
Data Science and Transition Economics
Data Science is an exciting new field in quantitative computing. Transition Economics develops leading edge Jupyter Notebook, Python and Dash, Plotly or MatPlotLib modeling tools like MEMS and WAOH (The World at Our Hands Report is TE’s Econometric Proofs Library). These TE tools and the data visualizations they permit, provide new clarity and insight into the reliable management of successful economies and societies. See a sample of some of the highest scoring of the 15,000 TEP reports that we curate in the slideshow below.
With new tools, come new capabilities. Each TEP chart is a consolidation of 15,000 lines and 60-years of data. Data science tools now permit us to process 10-TEP charts for 1,500 Indicators and Indexes in under an hour. This power permits the easy scoring, sorting, and ranking of Sustainable and Causal Indicators.
High TEP-Score Indicators and Indexes have high amplitudes – a large difference between minimum low and maximum high values. Alternatively, statistics whose TEP surveys have small amplitudes, have little influence on economies. TE Scores average the individual TE amplitudes of all TEP surveys – see a sheet of TEP Charts in the image to the left here
Are you curious to know which reports are better than the United Nations HDI Report – for example? There are a dozen better indicators – and this technique can help improve future HDI Reports as well
What barriers can there be to adopting an understandable, transparent, scientific approach that builds economies reliably?
It took Einstein’s 1905 Theory of Relativity 20-years to be accepted in the west; professors preferred status-quo explanations of Ether at the time. This will slow TE’s adoption similarly.
Human nature explains this really; our professors, experts, and schools have written books, authored articles, lectured, peer-reviewed one-another – based on proven-failed theory. They have been assigned positions in high posts and asked to lead prodigious programs, based on their mastery of fiction. A credible new science can suggest that their credibility and advice has been questionable, bruising egos and besmirching reputations. In hyper-competitive mature capitalisms, there are compelling personal and professional reasons for established experts to want to discount and adopt-indirectly their own tellings of a new scientific approach. Given time, they can update their researches as they learn and assimilate the new material.
Once this transition period passes, beneficial new approaches can be adopted
Important to any presentation of statistical information – is Context. First, presentations must compare successful nations, they must use most recent data, and they must present only credible measures. An example of a credible measure is any measure that is proven highly causal to an advancing economy. Context in history is relevant too; Debt was forgiven for most european countries in the 1930s from 25% to 250% of their GDP
Are stock market ups and downs meaningful? No. GDP lifts – No.
Macroeconomic Frameworks (see Section 2 of the World at our Hands Report) are important to build and manage in every nation
The important role of Academia is to prepare our adults and children to understand and maintain a Sustainable Society. Despite our investment in universities and in the teaching of business and economics faculties for 2500-years, however, 72% of 220 countries find that their economy is collapse-trending and that large percentages of their population are unproductive today. See TASK (The Academic Sustainable Societies Challenge)
Today, 220 nations are capitalisms with social programs and around 25% social ownership. Capitalism is important; capitalism monetizes a nation’s opportunity
Social Contract is critical to economic success
The important role of Businesses in any monetary-system-based society – is to monetize economic opportunity.
The important role of Government is to balance the unsustainable processes of business and ensure social contracts remain strong as monetary cycles compound inflations annually. As money gravitates to a smaller number of households over decades, economic growth slows because citizens are now “just surviving” and no longer have the freedom nor access to capital needed to contribute to the economy any longer.
See a full explanation of “Who does What – In a Sustainable Society” – Section 2 of TE’s World at our Hands Report
When unsustainable policies detriment the economy and population, businesses are impacted too. GDP reports hide these losses – as do accounting and finance industry reporting and bonus systems. In this way trillions of dollars are lost annually to economies suffering from low opportunity created by their weak social contracts. Social Contract loss is esticated to cost every nation an average of $3.6 billion per day.
Fruitless currency wars try and fail to bolster growth; populism and trade wars follow; and then a powderkeg of stress either leads to real wars. Or, your second option – is to simply create real opportunity without wars. Wars reset inequity; and this leads to economic boom reliably; so instead of having a war:
Reset the economy so that it can balance incomes to cost of living – and this will restart a new monetary system cycle once again
Transition Economics suggests a pragmatic and scientific approach to managing normal 60-year cycles of exponential inflation and imbalance in global monetary systems
The science of Transition Economics (TE) explains that Aristotelean Right Plans build and maintain sustainable economies and societies. Aristotle’s Right Plans have two parts: the first explain sustainable economic policies, and the second are the sustainable production of the goods we all need. Edward Tilley authored two engineering plans for this latter need – Worthwhile Projects #WPProjects was the first; and Worthwhile Industries
Transition Economics ensures that only proven-sustainable Government Policy is permitted at ballot boxes – especially in large democracies. It seems that small democracies can more readily recognize and vote for sustainable policies by themselves, New Zealand’s five-million population manage it without even a Constitution.
In today’s mature capitalism, ALL large democracies which don’t have FDR’s Second Bill of Rights in Constitution – are collapsing
End of War
The social impacts of transitioning to sustainable policy are minimized by ensuring strong strategic planning, education, project management (change) process, and reporting.
1837’s Great Depression was ended by a small-population U.S. citizenry of 12-million, who re-invested its ten-fold increased Gold Reserves from the California Gold Rush. Opportunity alone reset the U.S. economy from a Great Depression deeper than 1930’s. This created the Industrial Revolution of the 1850s. So – is offshore banking of corporate profit a sustainable policy?
This leads us to conclude that war was then, and is today, completely avoidable and even “immature” – in Transition Economics terminology.
It only takes your vote. Read about the ACT Party to understand how to quickly implement Transition Economics Resets in any nation. Reserve your copy of the upcoming Reform of War – The Democratic Reform ACT book, for a fuller, cited explanation of how we can, and should, be reforming our systems of democracy within large democracies.
Larger civilizations should make life easier for everyone – in theory, but the reality is that our systems of democracy were designed when we were small-population nations. These systems were not designed to prevent oligarchies and therefore, to preempt the support of unsustainable policies that profited few and reliably led our economies to the same austerity and starvation wages that created World Wars I and II – again and again.
No Economic Policy is uncorrectable – in Housing, Unemployment, Welfare, Taxation, Commerce, etc. and Transition Economics explains the research and methods to make changes responsibly.
Fully 72% of global economies are in a Collapse trending today. Transition Economics (TE) offers an important teaching and learning framework that explains scientifically, statistically, that imbalance is perfectly normal and correctable
This impromptu video is out-of-date and needs refreshed, but it captures a snapshot in time during the early development of Transition Economics before a Sustainable Societies Programme was formalized at CSQ Research
Inequity stalls Growth and builds Debt
Transition Economics is critical today because our economies have run their normal course and are no-longer sustainable by the status-quo policies that worked so well at the start of a new “boom” economic cycle in the 1950s.
Government did not have to protect Social Contracts as individuals had sufficient opportunity to do this for themselves.
Per the normal cyclic behaviour of 60-year repeating capitalist economies, our economy will collapse until we realize that we must change our Conservative Right Policy to permit a responsible economic reset to take place. To order the book Transition Economics, click here.
We see the same phenomenon in any Monopoly Game. Strategies that worked well at the start of a game, do not work at all near the end of the game. But if we change the rules, so that the victor returns a significant percentage of assets to the players of the game so that all can be productive and enjoy the game, this game can continue sustainably for an indefinite period of time.
In the Transition Economics chart above we see Opportunity is a waving black line; high in the beginning of a cycle and low in a mature capitalism. TE-Mature Policies vary – from capitalistic, monetizing policies early on in the cycle, back to sustainable, affordable policies as needed to reset Opportunity. These adjustments have resulted in a steady line of Opportunity in Norway, Ireland and most small-democracy and Monarchy-led nations today.
Credible Economists recognize Longwave cycles of economic boom and bust, as documented 40-times back to Ancient Babylon on the Code of Hammurabi (1763 BCE) and in Leviticus 25/26.
TE Maturity Models and TEP Charts discuss #TEMature policies that sustain Spring Economies and avoid Winters altogether, but if these steps are not taught to governments and not enacted, Winter Phase economies MUST switch to a number of key new policies in housing, in guaranteed reverse-tax incomes, and in automation engineering supports which can safely and responsibly restore incomes, spending power and restart a new and viable Economic Cycle once again – without war and revolution.
Failing this Transition, economies continue right along a collapse-trending – until either “new wealth” (as in the California Gold Rush example above, which ended the Great Depression of 1837), or responsible government policy intervenes. Without these resets, we have seen wars / revolutions / populism / dark ages and similar disastrous events reset the economic cycle by distributing wealth forcefully.
This is what John F. Kennedy explained in 1962 …
“Those who make peaceful revolution impossible will make violent revolution inevitable”
Mature capitalisms are normal; predictable; and correctable – and so are the wars and hardship they create.
Once we teach our high-school students (and future voters) the strategies that proactively prevent these collapses, we should be able to maintain a sustainable capitalism indefinitely.
The quicker and more thoroughly we reset to a new 60-year Financial Cycle, the quicker we will all realize a Good Life in a new boom economy.
Transition Economics – Simple, powerful, and truthful
Any Science must be defendable in observation. Where Keynesian Economic theories were proven unsustainable in the 1930s (Keynes acknowledged as much himself) and again in 2008 under Greenspan’s monitoring in the U.S. in 2008, Transition Economics’s approach is observed to work well throughout Monetary System historical records over 4,000 years
A new Science needn’t seem intimidating to us. In the words of Isaac Newton, the founder of two sciences in physics and in mathematics …
Truth is ever to be found in simplicity, and not in the multiplicity and confusion of things
Causality through Indicators and Indices
Transition Economics Proof (TEP Charts) and Historical studies are based on Indicators and on Indices / Indexes. Similar to the S&P 500 Index, a TE-Index can be based on a thematic grouping of indicators. Social Contracts, for example, are the basics we need – food, shelter, reliable incomes, security, healthcare, education, etc. To build this index we consolidate indicators measured for the past 60-years in every country – for education, longevity, inequity, suicide, and poverty
We can chose from a large number of social well-being measures – and thirteen social problem measures as well, and the best indexes become causal measures. A causal measure is one that we can rely upon to determine is a nation advancing or collapsing-trending. A causal measure builds strong economies 100% of the time when high, and collapses economies 100% of the time when low – see the following charts as examples
Indices measure topics not easily captured in a single measure and they can also turn seemingly intangible qualities into quantifiable measures as well. For example we can compare Production vs Consumer Economies, Social Contracts, Social Contract Loss and a Social Contract Product (to pair against) GDP
Do strong Social Contracts build advancing economies consistently? To answer this question, we use transparent Transition Economics (TE) Proofs (TEP) Charts. See how these indicators were selected in the thesis End of War):
TEP Charts are frequency distributions; these specific TEPs survey 158-countries to confirm that high social contract nations have advancing economies – both reliably and progressively – up to 100% of the time
These TEP Charts show something else too. Not only do strong social contracts increase the probability of an advancing economy (see the right upper orange line), but weak social contracts increase the probability of a collapse-trending stalling economy too (seen on the left side of the orange curve). In a TE Proof Chart, every plot is a survey of the number of countries indicated on the blue line here
The Social Contract measures the most economically beneficial social measures of an economy:
The SCP Report (Social Contract Product), adds the most beneficial financial measures to Social Contract:
The SCP Report
Export per Capita
Are these truly the best measures of successful economies? For 2019 we didn’t have the World at our Hands Report and we didn’t have scoring – which is a ranked list of every available TEP Chart Survey, as we have now. In 2020, we’ll know a lot more and we will revise the SCP and Social Contract to include the best social and financial measures possible. As it is, 100% of The SCP’s top-20 countries have advancing economies; that’s a much better indicator of economic success than the GDP, HDI/IHDI, or other Happiness Index reports offer today
Indexing cautions are obvious but sometimes suptle too. One cannot hope to measure the importance of Export – based on a normally-causal indicator of Export per Capita – this is an example of an obvious problem. Similarly, one cannot measure high-income nations based on gender stats easily because fertility rates are unsustainable in 94% of high income nations. This is an example of a more subtle caution
The World at our Hands Report
A complete library of TEP Surveys resides in the World at our Hands Report. Researchers are invited to contribute to the library and CSQ Research publishes updates on a regular basis
Cause and Effect
Russian Economist Nikolai Kondratieff noticed that monetary system cycle Longwaves also coincided with technological advances. Economic opportunity, capital, and strong social contracts became the cause for the effect of a boom in technological innovation.
The Great Depression of 1837 was a Great Depression as bad as 1930s’ and worse. It was ended by the California Gold Rush which multiplied the Gold Reserves in the U.S. ten-times. This great infusion of capital meant that banks could extend lending easily to engineering firm and industrialists as was needed to build the Industrial Revolution of the 1860s.
Similarly, the high opportunity climate of the 1960s, inspired the Cold War-times great advances in technology. With no war to slow research and unlimited resources afforded to them, scientists created some of the greatest advances that mankind have ever known in the short span of just 25-years.
Economies – both good and bad, are caused by something. Transition Economics’s approach is to use TE Proof Charts – TEPs for short, and similar infographic tools to understand how dramatically does any policy contribute to, or cause, an advancing economy.
As it makes little sense to compare your country to other’s with failing economies, we compare every policy to understand “is it a correlation with”, and “does it cause an advancing economy” as well.
All policies are then ranked by causality (in building advancing economies) on a TE “World in our Hands” Report as seen in End of War – Managing Mature Capitalisms.
Credible Measure ?
TEP Score = .20
Little credibility – per debt forgiveness and TEP
|Export % GDP
TEP Score = .55
Yes – Causal
|U.N. Education Index||
Yes – Causal
|A Wall||No – Except in 10% of cases due to short-term security concern cases. The more important policy here is Empathy; well-supported neighbors don’t need to leave home to find a good life|
|Russian Collusion and assorted TV Drama||No – Vote for empathetic government officials and ACT-compliant proven policies|
World War III by 2030?
Similar to the wars per decade in this chart, we see similar 60-year “U”-shapes in statistics for inequity, debt, savings, Bond Yield, PPI (U.S. Pricing) and also in social KPIs from longevity, unemployment rates, suicide rates, and similar. If the timing of starts for World Wars I & II were to repeat, a failure to correct Social Contracts by 2030 could very well result in World War III. Today’s is the first mature capitalism to take place in a mature nuclear era.
For anyone who isn’t very clear on this point, World War III could be an extinction-level event affecting 100% of the human population of this planet.
The primary concern of Transition Economics is to identify the necessary ongoing adjustments in Economic Controls and Government Policy which must be made in order to manage balance in a naturally recurring 60-year Monetary System Cycle.
Why 60-years? Simple Compound Inflation
Why has there been such a large increase – and why are these exponential increases a mathematical certainty?
Annual inflation is calculated from GDP values taken one year prior, which included all of the accumulated inflations of prior periods. Like interest rates, a 10% inflation last year plus a 10% inflation this year, does not amount to a 20% increase, it amounts to a two-year increase of 21%, a five-year increase of 61%, and so on.
Today, 1% to 14% annual inflation rates have compounded for 60-years from the start of our present monetary system cycle. If salary to cost-of-living ratios get out of balance (and they usually do), the gap – like the inflations, increase exponentially – and this guarantees that monetary systems are not sustainable without either on-going balancing or a “Reset”.
Controls in housing, monetary systems, interest rates, and wealth distribution, must change as the monetary system cycle matures. Kondratiev called these phases – expansion, boom, recession, and depression – Spring, Summer, Fall, and Winter.
The black line in the chart below notes opportunity within an economy. Great Depressions have come every 60-years in capitalist societies; or shorter, if inequity failed to reset properly in the previous cycle. The European Dark Ages (500 -1300 AD approximately) is an example of a global economy that never reset inequity until it remained in depression for hundreds of years. World War II was certainly created by inequity as was World War I and dozens of revolutions globally when governments failed to reset inequity after the Panic of 1893.
Kondratieff first wrote about this phenomenon of Longwaves in 1925; Howard Schumpeter brought the study of Longwave Economics to Harvard in the 1940s, which he renamed Kondratieff Waves in tribute to its founder – or simply K-Waves. K-Waves in Capitalist societies have since been confirmed back to 930 AD China in numerous academic thesis, and Edward Tilley suggested in 2015 that these phenomena are confirmed again in records of the Economic Controls, the pre-emptive 50-year corrections made by “Jubilees” (Debt forgiveness & Wealth Redistribution), that are recorded on the 1760 BCE Code of Hammurabi and also Leviticus 25-26.
Click on charts to see Hi-Res image …
In the right-most chart, note how some countries were able to keep inequity from forming a U-shape again as the monetary cycle matured, while other countries could not.
What about the leaders of Monetary System Cycles?
Making a Monopoly Game Sustainable
At the point where players begin to drop out of a Monopoly Game, Transition Economics introduces new rules and new policies, that reset the ability of all players to continue – and to be prosperous indefinitely. In the same way that policy changes restart or sustain a game of Monopoly, a new cycle of the monetary system must be initiated too.
FDR (Franklin Delanor Roosevelt) created the greatest economy in history – the American Dream – with policies of Nationalism, Full-Employment, an empathetic strong social contract – which included social programs, low costs-of-living that also afforded titled-property home ownership, and perhaps the greatest contribution – debt forgiveness and wealth distribution. For 20-years, America taxed the rich 92% income tax and 80% estate tax. The correction of inequity and a strong manufacturing demand with high living wages – was all it took
Henry Ford – made the greatest contribution of all time to international economic growth, through his living wage policy. We see in this chart that the first industrial revolution’s sweat-houses in the 1750s made no significant economic impact. The second industrial revolution of the 1890s was a different story because of Henry Ford’s high wage policies that rippled out across industrializing nations.
Adolf Hitler – turned Germany’s economy around even faster than FDR – through Nationalism, Full-Employment, Social Contract and wealth distribution, but his administration forgot essential “Empathy”. Respect – toward both neighbors and also toward its own citizens was the failing that undid any benefits – and this is seen similarly in the downfall of most failed civilizations in history – Roman, Mongal, Byzantine, and so on.
Donald Trump – Addressed: Nationalism, Full-Employment Unaddressed: Social Contract, Empathy, Cost-of-living, and affordable home ownership
Sustainable Policy: are the TE Mature Policies mentioned above – and those causal reports seen in the World at our Hands Report
Unsustainable Policy – in Mature Capitalisms: Low-Tax, Death-Tax, Small Government, Open Markets, Middle Class, Usury, High Cost of Living, Globalization, Immigration – read Dickens, Tolstoy, Byron, Hobbes, Rousseau, Hugo, Hammurabi, and others to understand the dystopias that these policies built during various mature capitalisms. The American War for Independence was a mature capitalism, as was the French Revolution, Russian Revolution, Age of Enlightenment and the transition from Monarchies. The fall of most empires through history can be explained by their adoption of unsustainable policies …
Yes, of course we are in a Great Depression today – there is “problem” to solve here. Wealth Redistribution Policies are needed urgently in housing (perhaps revisiting land-grants instead of Usury through unpayable mortgages), Interest Rate recovery protections, Usury Prevention Laws, Graduated Tax (92% for Rich), Offshoring & Foreign Ownership Protections, Income guarantees and working Safety-nets, Automation of Basics of Life – see #WPProjects.
The Good News? The deeper the Wealth Redistributions in a Winter Phase and reset; the longer and more successful is the next new 60-year monetary system cycle – and American Dream.
Inequity is expensive. Who is paying the bills?
In any discussion of Economy, it’s important to realize that WE ALL ARE paying the bills. Inequity costs $4 for every $1 spent to maintain it. We can have performance bonuses and rich people, but when a large percentage of citizens do not have the opportunity to produce export wealth for a country, it makes the economic pie smaller and costs economies trillions of dollars annually
During this next turn of the cycle, we are also transitioning from our current Manual Economy to an Automated Economy. Our technology has advanced sufficiently to support this important event in our Human Evolution and this is a really exciting time because automation that gives us the basics of life – like food, energy, shelter, and transportation automatically – can be considered – Renewable. Once Renewable Automations are scaled to the entire planet, we might never have to transition out of another Capitalist Cycle again – not 60-years from now – nor forever. Our reliance on money diminishes with this automation until we can finally ween off of any counter-productive influences that debt and monetary policies have brought into our societies as well.
“Imagine how foolish will we all look once we have permitted special interests to safeguard inequity – even at the potential risk of obliterating all in a nuclear war – at the very same time that humanity could be deploying our renewable automations to make money as unnecessary as we might like?”
Transition Economics – Edward Tilley, 2016
Transition Economics guides you through the Scientific Method of aligning policies that work to accomplish both Automation and a renewed, sustainable Cyclic Prosperity easily.
Automation and Jobs
Strong Social Contracts build strong Economies, and they are inexpensive too once robots build life-cycle-managed housing automatically. No-one starves when food is delivered to every home without a human hand required too. Like Google’s Driverless Car from 2013, food and shelter are both examples of automation projects that can be built within just 2 to 5 years. There is also no “emerging” technology required here either; it only takes focus to build socially important assembly lines that also build a self-sustainable strong economy.
Automations are forecast to reduce the total number of jobs by up to 50% over the next 20 years; that’s approximately 970 jobs lost per month per million population, lost per month.
Jobs being lost to automation are not new, the automated weave, Bessemer Steel Process, the cotton gin, water pumps, electricity, farm tractors, and modern assembly lines have all reduced the need for repetitive labor jobs.
Thousands of lives were lost to riots and hardship in these transitions when Governments failed to ensure a strong social contract. “Government for the People” (Democracy) must ensure that it supports the transit of its citizens to other forms of income and retraining through these innovation-driven changes.
Transition Economics studies the relationships between social contracts, automation, exports, guaranteed incomes, government investment, and infrastructure spending. This has not been addressed by previous theory scientifically.
TE Mature Policy & Models
Transition Economics is a new science, there is much work, improvement, and learning ahead. Click here to view Transition Economics’s Maturity Models and TE-Mature Policy