Introducing Transition Economics

New Science

Transition Economics (TE) is a new, easy to learn survey and probability-based econometric science. Economics is old, theoretical, failed, and non-causal – where TE’s Management Analytics and Governance is simple, scientific, and provably causal. TE deprecates Micro and Macroeconomics with a fact-driven, observed-successful, reliable solution to building sustainable abundant societies and advancing prosperous economies

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 high social contracts and strong economies, despite a global mature capitalism elsewhere. Clearly, a successful policy solution exists for any economic era

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 surveys 2000+ indicators and indexes in 220 countries to validate causal and sustainable policies quickly and transparently through simple data science and management analytics governance techniques

TE proves easily that Mr. Dickens’ “Mankind is our business”, is more than a platitude because nations with high-scoring Social Contracts create advancing economies 100%

TE proves that Bibles were intended to be textbooks that describe how to build sustainable societies, as most laws and policies here are causal or sustainable – and acquired through lessons learned over 4,000 years. Family values, respect of community and neighbors, respect of employees, living wages – are all essential to sustainable prosperity and fertility rates as well

Making Economics a science is as important as realizing that most countries share the same reporting problems. Right and Left policies are irrelevant;  GDP, Disposable Income, Unemployment, Stock Market Performance, Supply & Demand ? Are NOT CAUSAL ! Unsustainable policies collapse economies and societies reliably and the mature capitalisms they create are expensive, dangerous, and preventable. Any system of government, school, or voter, that supports or teaches these policies is socially irresponsible

The first step in solving any problem is realizing you have a problem –  Zig Ziglar

Beyond Economics, TE and SUSTAIN Program Management epistemologies (expert methods) are extendable to any large, complex change that needs a comprehensive scientific approach to Management Analytics and Governance. See Worthwhile Industries or the United Nations’ SDGs for an example

Terms

The USE CASE for Monetary Systems

Disambiguated terms for Monetary Systems and Government, Business, Finance and Social Policy, are essential to scientific problem-solving and Proofs

When we don’t know what to stand for, we can fall for anything…

In the U.S., starvation wages started (and living wages ceased) when salaries fell below Cost-of-living in the late-1970s

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 $3 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 $3 billion dollar Social Contract Loss?

Every major nation in Europe had debt written down in the 1930s to 1950s

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’s High Industrial Living Wages created prosperous Economies

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

Read about the Social Contract Product Report in End of War – Managing Mature Capitalisms and click here to see the SCP Report for 2019 

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.”

Leviticus 25-26

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 should work, TE teaches how economies 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 :

Trade Surplus
(indicated as “Advancing” in TEP legends)

SCP over 5.5 (sometimes 5.8 – or similar)

Export – per Capita over $8000, or over 55% GDP

Social Contract

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 

TEP Sheets consolidate all TEP measures for all countries – per indicator. Charts on the right side of a sheet measure High Income Nations only

Probationary Measures:

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-PPP per Capita – Top 30 Nations ($38k in 2017, $40k in 2018)	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

WAOH

Find our library of TE Proofs and Methods at the World At Our Hands Report

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.

TEP Scores

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