Table of Contents

The 29th Day: Changing Our Future

Solutions in a World of Accelerating Change

 

The Art of Fighting Without Fighting

2009 Copyright © 29thday.org All Rights Reserved

                                                    






Consider this ...

• Why Citizens feel so disconnected from Government. 
• What is wrong with the US Economy and what will make it right.
• How cost/quality/access can be balanced in the US Health Care System  
• Why there was a 2008 Financial Crisis.
• Why the 2009 Economic Stimulus didn't work. 
• Why the US/Mexican Border has not been secured.
•  Why the 2010 Gulf Oil Spill happened.
• What is really happening in Europe and the Middle East.
  
• Where we will be in 10 years … in 50 years.

• What WE can do about what is happening.

The exponential clock is ticking toward the 29th day, toward the end of our dreams for a better life, toward the end of your dreams for a better life ... tick, tick, tick.

All of us have a part to play ... all of us. Nobody is exempt. No matter how big or small your part is, no matter what your part is, in the words of Nike ... "Just do it!".  If enough of us act,  we can change the world. That is the power of CIC.

If you know someone is doing something wrong, they may stop if you tell them. If you want to be sure they will stop, then tell everyone. That is the power of CIC.

Don't let someone else decide your future for you!

To: Website Visitors                                                                                 

From: George Berry, Actuary

The work of science is to substitute facts for appearances and demonstrations for impressions.
John Ruskin (1819-1900) English social thinker, Motto of the Society of Actuaries 

Welcome.

My objective in writing this book is not to become popular, rich, or famous. It is to challenge all of us to think and then to act. I don't have a lock on the Truth. My intention, therefore, is to rely on website visitors to do their own homework, to form their own opinions, to decide for themselves what to believe and/or accept, and, hopefully, to communicate their comments and criticisms to me to make this Book better.

With five children and being a consulting actuary in health care financing. I recall well that the daily pressures of living would have left little time or energy to step back and say, what does redirecting the future have to do with me? As someone once said, "When you're stepping on alligators, it's hard to remember that your prime objective is to drain the swamp". Hopefully, Chapter 7 will enable you to find more time. It did for me.

I recall also that the day to day pressures of business and finance placed too much emphasis on symptoms and too little on causes. I am now a retiree with the time to step back and to examine causes without the "noise interference" of symptoms (and clients). As a mathematician, what I see is a world of accelerating (exponential) change that is moving too fast still attempting to implement solutions in a traditional (linear) way which is ... just ... too ...slow (Chapter1).

Consider, for example, how quickly the uprising in Libya occurred, and yet how slowly the decision about a no-fly zone has been made. In my opinion, this reflects also an uncertainty about our Core Values (Chapter 6). Don't you find US policy about our role/objectives in Libya confusing? And does anyone have an answer to the question, "Why in the world does the United States seem incapable of resolving the problem of illegal immigration?" (Chapter 14). Or, "Why is the US Government bragging about saving $30 billion when we are $16 trillion in debt (September, 2012)?" (Chapter 15). Sixteen trillion is 16,000 billions! And I'm not even including the many more trillions in public pension and Social Security unfunded liabilities (Chapter 12).

Are we approaching the 29th day for the United States? (September, 2012). I do not say this lightly and, in my opinion, both political parties share  the responsibility for the current state of affairs. Consider what has happened.

• The US National Debt went over $16 trillion (that is 16,000 billions). That is more than $51,000 for every man, woman, and child.
• The third Quantitative Easing (printing $40 billion per month) announced by the Federal Reserve caused the rating organization, Egan-Jones to lower the US Government to  AA- from AA. Paul Ryan, the Republican vice-presidential candidate, called it a "sugar-high" for the economy less than two months before the Federal Election. Too much money chasing too few goods and services always leads to inflation. It is inescapable.

• The United States is mired in a stagnant economy with unemployment remaining above 8% and the increase in Gross Domestic Product stuck below 2%. Average income is declining and the number of people below the poverty level is higher than it has been for decades. The Bush tax cuts are scheduled to expire or be renewed on January1, 2013 as are the devastating Sequestration cuts to military and domestic spending. Obamacare is in the process of implementation with as yet an unknown impact on health costs and taxes. Expanding regulation has inhibited business to grow and expand. The debt crisis in the European Union shows no signs of being resolved with attendant repercussions for the American economy. All of these factors introduce uncertainty, the "economy-killer", into the mix. 
• Illegal immigration continues to be an unresolved issue with no light on the horizon. 
• On September 11, the anniversary of the terrorist attack on the Twin Towers in New York City, there were demonstrations against the United States in Egypt and soon afterward across the Middle East, Africa, Asia, and even in Australia. These were ostensibly a reaction to an obscure YouTube movie which appeared in July denigrating Islam. 
• The US Libyan Embassy was set on fire and the US Ambassador and three members of the Consulate Staff were killed. Members of the Obama Administration claimed that this was a spontaneous reaction to the YouTube movie despite the fact that Rocket Propelled Grenades were involved and everybody else seemed to be convinced that this was a preplanned terrorist revenge attack coordinated to take place on September 11. After eight days, White House Press Secretary, Jay Carney, acknowledged it was "self-evident" that this was a terrorist attack. Nevertheless, the Administration is still claiming it was tied to the YouTube movie. What is interesting is that in the second Presidential Debate on October 22, 2012 President Obama said unequivocally that he had stated this was a terrorist attack during a press conference in the Rose Garden on September 12, 2012, one day after the attack. And now, on October 23, 2012 an email from the State Department to the White House Situation Room has come to light stating as it happened that the attack was by a terror group. Request for additional security were denied and then later during the attack there were three unanswered calls for help. Can it get any worse? And finally, wouldn't the Obama Administration be offering more information if it made them look better?
• President Obama appeared on the David Letterman TV Show and yet was too busy to meet with Benjamin Netanyahu, the Prime Minister of Israel, to discuss the inexorable progress by Iran toward the successful development of nuclear weapons. The US has refused to "red-line" Iran which would define a point beyond which action would be taken.
• The risk of an interrupted oil supply is increasing exponentially. It is becoming obvious to everyone that the United States must move quickly toward domestic energy independence. The adverse consequences of our failure to do this have been horrendous both domestically and, in particular, with respect to US foreign policy in the Middle East and elsewhere. And yet ... and yet the Obama Administration continues to refuse to approve construction of the Keystone XL Canadian oil sands pipeline. Shall we wait until the Canadians decide to sell the oil to the Chinese? A report on the potentially enormous oil and gas resources of the 1.5 million acre ANWR area of Alaska was submitted in 1987 to Congress by the Department of the Interior. No action has been taken. Drilling leases on federal lands are not being approved. What are we waiting for?

President Obama continues his uninterrupted campaigning and the US Congress is on the verge of a long recess. Shouldn't Americans feel completely justified to be outraged by the lack of response to the now obvious deterioration of the United States both domestically and abroad? Are US political leaders aware of the risk and real danger here? They are playing with fire and acting like the man who was asked for the definition of Ignorance and Apathy. His response was, "I don't know and I don't care." As for help from our Allies, remember, the first reality of geo-politics is anarchy. All countries will never fail to act in their own self-interest.

Americans should be asking ourselves one simple question, "Are things getting better or are things getting worse?"  And we should be asking a more difficult question, "What am I prepared to do about it?"  How long can we continue to say, "I'm too busy", "It's not my problem", "I'm not interested"? Are we just going to wait for the 29th day

Make no mistake, interest rates will begin to rise and/or the Stock Market will begin to fall if the US Debt Limit resolution (written July, 2011) is viewed as inadequate. And in our new electronic, exponential, globalized economy, this could happen in seconds. Have you noticed interest rates in Greece lately? 

Most of us would agree that the most significant issue facing the United States right now is the answer to the question "What is wrong with the US Economy and what will make it right?". Why have none of our political leaders been able to articulate an answer to this question which is clear, understandable, specific, practical, and believable? (Chapter 17 - CIC and the US Economy, perhaps the most relevant Chapter in the Book).

The presumption of the US Federal Government is that it must be the architect of any economic recovery by creating jobs. In fact, it is the Private Sector which creates jobs and wealth. The President's message should not be, "This is how I will create jobs". Rather, it should be, "This is how I will get out of the way to better enable the Private Sector to create jobs".

One of the problems confronting the US economy is that, like the federal government today, too many people were using borrowed money as income for decades before the financial crisis of 2008. When they were unable to continue borrowing, such income disappeared. It will not return until their outstanding loans have been repaid. This has left a big hole in consumer spending, which is about two-thirds of the US economy, and made recovery a lot more difficult. Unfortunately, a substantial part of this borrowing was in the form of higher home loans which turned out to be a very bad idea when the housing bubble burst.

As I see it, we have three economic choices:
1. Make the tough decisions to reposition and redirect the US economy: promises made and expectations may have to be revised downward but at least we will be able to pay for them and end up with a healthy economy.
2. Don't make the tough decisions to reposition and redirect the US economy: inflation will revise the value of promises made and expectations downward to a level we can afford. Unfortunately, at the same time, inflation will devastate the rest of the economy.
3. Something in-between 1. and 2.: The closer to 1., the lower will be inflation and the healthier will be the economy. The closer to 2., the higher will be inflation and the more devastated will be the economy.

Pretending these are not our choices will result in 2. It is time to Pay the Piper and his price-tag for delay is inflation and increasing the difficulty of the decisions required ... exponentially. What people everywhere cannot believe is that, for the first time in our lifetime, there is no longer enough money to pay for everything we want. Unfortunately, we have waited so long to do anything about it that we are not even close to having enough money. The reality is that it is likely that everybody is going to pay, whether they like it or not.

My conclusions are that because of the rapid (exponential) development of computers and the internet:

• the 21st century is significantly different than past centuries (Chapter1),
• there is a lack of awareness and clarity about what has happened,
• there are too many sound-bites, impressions, and excuses and not enough substance and clear common-sense thinking, backed up with facts and demonstrations, 
• we need very different kinds of solutions now because we have very different kinds of problems,
• "business as usual" doesn't work any more,
• we are running out of time much more quickly than we may realize to solve some very serious problems. The 2008 Financial Crisis is a good example (Chapter 3). 
• most of our leaders do not have the necessary sense of urgency, 
• people are feeling increasingly helpless and frustrated ... and angry,
• there is much more at stake than we may realize (Chapter 19),
• the hope for redirecting the future will begin with individuals like you and me and not with governments (Chapter 2). Recent events in Egypt (March, 2011) are a good example. 

That is what this Book is all about. I am hoping that you will be willing to open your mind to some new ideas. I am hoping that you will see and agree that, as impossible as it sounds, it is you and I who must begin to redirect the future. I am hoping that you will realize even day-to-day life will become worse than our worst nightmare if we don't. My thinking has lead me in two directions.

The first direction has been to be prepared for the worst, which is that there is no possible way to redirect the future. Over 30 years ago, my wife and I purchased 100 acres in a remote area of Canada. Most of our "civilized" skills were useless in this environment, and learning country living and self-sufficiency has been a long slow process. It is definitely not something that can be done "at the last minute". But we are as prepared as we can be.

The second direction has been to hope for the best, which is that there has to be a way to redirect the future. The result is on this website, 29thday.org. You can judge for yourself. As it turns out, I believe that there is a way to redirect the future. While I have read and studied others' analyses of what is happening, who to condemn, how to prepare etc, many of which are excellent, my context is "So what can we do about it?". My mindset has had to be that there is actually a way to redirect the future successfully. With 5 children and 20 grandchildren, I have no other choice. One of the things I have learned over the past 30 years is that blaming others generally leads to inaction. To me, it is simply a variation on the theme, "It's not my fault". Too often, it leads to the smug feeling, "I have figured out what is going to happen, and now all of those other people are going to get what they deserve."

President Ronald Reagan said, "Freedom is never more than one generation away from extinction. We didn't pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same, or one day we will spend our sunset years telling our children and our children's children what it was once like in the United States where men were free".

I believe strongly that doing nothing will result eventually in the loss of our Freedom, something which is unthinkable and unimaginable to most Americans and Canadians. It is very real, however, to those brave men and women in the Middle East and Africa who are fighting and dying for Freedom right now, to the brave American, Canadian, and Allied Armed Forces (and their families) who are serving on the front lines in Afghanistan and Iraq, as well as to those Americans and Canadians who are actively engaged already in a variety of ways across the United States and Canada. We have to wake up, and to grow up, in order to realize that our future is not going to be redirected unless we act deliberately to do it. The longer we wait, the more difficult it will be, until eventually it will be impossible. What I am offering here is a way to make ourselves heard, a way to redirect our future. My earnest hope is that you will pursue it. Or to use a term from the old Scots law, become an intromittor, which is someone who gets involved. My goal is the preservation of our independence (as in the Declaration of Independence).

Right now (July, 2012), the United States is on the brink of a divisive conflict between the Public Sector and the Private Sector (politically defined as "the middle class vs. the super-rich"). These two sectors have a quasi-symbiotic relationship. The Public Sector provides protection, regulation, infrastructure, and a safety net. The Private Sector finances the Public Sector by paying taxes, and creates jobs and wealth  through innovation and risk-taking which is what enables it to pay taxes. The Public Sector hurts itself by being too onerous because that results in lower tax revenue. There is a limit to the alternative of borrowing and increasing the National Debt which occurs when lenders will simply refuse to lend. If and when that day comes, all of us will suffer far beyond our worst nightmare.

The reality is that the Private Sector, not the Public Sector, is the goose that lays the golden eggs. Cripple the Private Sector, or the people who expand the Private Sector... and no more golden eggs. The creative spark of the unencumbered, entrepreneurial individual mind, whether in the form of the wheel, the telephone, or the computer, lights the path to prosperity. The rest is just window dressing. To say otherwise will never make it so.

One indication of the confusion about the free enterprise system is the controversy which has erupted in July, 2012 about the contribution of small business to the economy. What the small businessman does that employees and government do not is he (or she) takes a risk. If it works, he is successful; if it doesn't he can lose everything. This is the essence of the free enterprise system and I am disappointed that nobody, Democrat or Republican, has mentioned it.

We have reached a tipping point as a result of the collusive relationship between politicians and unions, and misleading accounting practices (see the Chapter on the National Debt) - politicians promise higher pension and medical benefits to public employees in exchange for election support by their unions. These benefits have been massively underfunded raising the specter of city and state bankruptcies. At the national level, the tipping point may be the actual cost if Obamacare is implemented, or simply waiting too long to repair Social Security and
Medicare.

The very real threat of  "A house divided against itself cannot stand" in this looming tragedy is because half of us pay income taxes ... and half of us don't, a few of us are wealthy ... and most of us are not, something which is ripe for unscrupulous political manipulation in an election year. And watch out for what Socrates said, "When the debate is over, slander becomes the tool of the loser".

We have had a glimpse of the future in Greece and even in the State of Wisconsin. This is becoming a life and death struggle between concentration of power and distribution of power, between coercion and enlightened self-interest, between tyranny and freedom. It is time for all of us to take a stand one way or the other or get out of the way. Be wary of three fatal errors: 1. Everything will be resolved satisfactorily even if we do nothing; 2. This is really a struggle between the rich and the poor; 3. The Public Sector is the goose that lays the golden eggs; 4. A tyrant will be kind and generous to us.

Samuel Adams said, "If you love wealth greater than liberty, the tranquility of servitude greater than the animating contest for freedom, go home from us in peace. We seek not your counsel, nor your arms. Crouch down and lick the hand that feeds you; may your chains set lightly upon you, and may posterity forget that you were our countrymen".

The emphasis in this book is American because I am an American (and also a Canadian). But the application of these ideas is universal.



                                                  **********************




Forward
Prologue
Introduction
Chapter 1
What is the 29th day?
Chapter 2
What in the world is CIC? - CIC Principles
Chapter 3
What really happened to the Financial System in September, 2008? And what did CIC have to do with it?
Chapter 4
Is the US Federal Stimulus Program actually stimulating the economy? Where is CIC?
Chapter 5
Why are Americans feeling disconnected from the US federal government? The clash of CI and CIC
Chapter 6
What are Core Values and why are they necessary?
Chapter 7
CIC and The Family - Time Choices, Priorities, and Lessons
Chapter 8
CIC and the Lottery
Chapter 9
CIC and the Media - Another clash of CI and CIC
Chapter 10
Can CIC affect US Health Care Reform? - The Road not Taken
Chapter 11
CIC and Education - Is the Tail wagging the Dog?
Chapter 12
CIC and Entitlements - A Reality Check
Chapter 13
CIC and Demography - The Hidden Tsunami
Chapter 14
CIC and Immigration - Has somebody been trying to use Slavery again? Is this really a global issue?
Chapter 15
CIC and the US National Debt... uh, oh.
Chapter 16
CIC and the US Federal Reserve - heh! heh! heh!
Chapter 17
CIC and the US Economy - Rolling the boulder down the mountain
Chapter 18
Does Iran have to be a 'rogue' nation? - Is this CIC Chess?
Chapter 19
CIC and the Mother of all 29th Days-Where are we headed? And with whom?
Chapter 20
Is CIC a panacea? Can it fail? Will it succeed? Can it be destroyed? Why should anyone use it? Who is likely to use it?



                                                 **********************



                                              Forward
                     Tyranny or Freedom - Can We Avoid Another 29th Day?


Neither a wise man nor a brave man lies down on the tracks of history to wait for the train of the future to run over him.                                                
Dwight D. Eisenhower (1890-1969) Military Leader, President of the United States

The greatest shortcoming of the human race is our  inability to understand the exponential function.
Albert A Bartlett (1923- ) Emeritus Professor of Physics, University of Colorado in Boulder


This Book asks us to be adaptable enough to change our perception of reality. It will be difficult and is somewhat like realizing suddenly that the sun really comes up in the West rather than in the East. And so, a legitimate question arises, "Can we do it?" The good news is that this new reality offers the opportunity for you, along with millions and millions of people just like you, to change the future, to change the world. I expect that sounds unbelievable to you. It certainly did to me when I first thought of it. Well, open your mind, take a look, and see what you think.

Exactly what is this change in our perception of reality, and are you willing to consider it? We need to believe that it is possible for reality to be accelerating. For most of us, this will be a new idea. Most of us think that reality is linear, that is, reality is not accelerating – day by day by day, year by year by year. By extension, most of us think that changes within this reality are linear too, that is, the rate of change is not accelerating, not exponential.

But it is. This is the way I would explain what has happened.

There was a lily pad on a pond, which doubled in size each day until, after 30 days, it covered the pond. The riddle is, on what day did it cover half the pond? Most of us think the answer is the 15th day, but it is not. The answer is the 29th day ... because the lily pad doubles in size each day. So, it will not take 15 days to cover the first half of the pond and 15 days to cover the last half of the pond. What seems unbelievable to most of us is that it takes 29 days to cover the first half of the pond but only one day to cover the second half. This is exponential power. Linear thinkers (most of us), who add to get the rate of change, think the answer is the 15th day and that 15 days remain to cover the last half of the pond. Exponential thinkers, who multiply to get the rate of change, know the answer is the 29th day and that only one day remains to cover the last half of the pond.  Q. How much of the pond is actually covered on the 15th day? A. 3/100,000 or 0.003% of the pond.

In the 21st century, for the first time in history, our world has become visibly exponential, that is, the rate of change is accelerating visibly, just like the lily pad. And we are thinking mistakenly that the 29th day is only the 15th day. The result is we feel that (exponential) problems are becoming crises too suddenly, and traditional (linear) solutions are being implemented too slowly.  It is frightening us, angering us, making us feel that things are out of control. In fairness to President Obama, it is much more difficult to be an effective President in an exponential world. Much more difficult.

This has happened because of  the extraordinary development of computer technology, particularly personal computers and the internet. Now, at the speed of light, everyone can tell the world what is on their mind. We can share information instantaneously. We can Google to find out immediately whatever we want to know. We have discovered a new, fantastic way to communicate, to enhance our creativity, to get information, to share it with everybody, to exert influence, to gain personal power and then to use it. Hoarding information is now obsolete. No more secrets. I call the exponential force which has been released, CIC (kick). These letters stand for Creativity, Information, and Communication. Each of the components of CIC is exponential. Imagine how much more exponential they are combined into CIC. And CIC will trigger innovation to revolutionize education. How about free education for everyone around the world? Check out www.khanacademy.org. Bill Gates likes it!

This tremendous acceleration in the development of computer technology has been transferred to everything else ... because of the way we use computers and the internet to communicate ... such as the economy, politics, health care, immigration, warfare, terrorism ... by this force, CIC, that has been unleashed by computers and the internet. You are not imagining  that the world is moving more quickly now than in the past. It is. Everything has become visibly exponential. Have you noticed that messages from government and virtually every advertisement now have a web address attached to them? Do you have a mobile phone, a personal computer? Are you a member of Facebook, Youtube? Do you Twitter? Do you read blogs? Do you get your news  from the internet as it happens? That is CIC at work. It enabled Bill Gates to become a billionaire by the time he was 30. A few years later, it enabled the founder of Facebook to become a billionaire in his 20s. It enabled a young woman to make a video and put it on Youtube, protesting that her bank had increased the interest rate on her credit card to 30%. The result was that her bank reduced the interest rate on her credit card. This is exponential power. These things would have seemed preposterous just a few short years ago.

One of the most vital things that CIC does is to transfer or distribute power from institutions to their "markets", that is, to people like you and me. This is happening whether the product of these institutions is cars, health care, government, religion, or working conditions.  This is what empowers us to redirect the future. Whether or not we choose to do so is a test of our character. How we redirect the future is a matter between us, God, and our conscience. I am using CIC right now. You can use it, too. It is available to everyone. And be assured ... it is being used right now to redirect our future ... your future.

A major conclusion of this Book is not that exponential forces will continue unchecked. It is that limiting factors are guaranteed to occur. "Limiting factors" is just another name for 29th days. The pivotal issue is, "Can We Avoid Another 29th Day?" The only way to do this is by redirecting the future with an exponential solution(s). My deeply held belief is that if those people who love Liberty do nothing, or wait too long to introduce exponential solutions, then those people who are against Liberty will simply wait for limiting factors to occur, and the result will be the loss of Liberty. Furthermore, if there is no awareness of the nature of the exponential forces at work, the natural limiting factors which will inevitably occur will have the effect of destroying Liberty. Ask yourself, "Did I lose some of my freedom, some of my choices, when the natural limiting factor of the Financial Crisis occurred in 2008?" I believe it is absolutely critical that this point be understood. Otherwise, those people who are for Liberty are likely to miss the necessity of them taking action to introduce exponential solutions. In fact, an important part of this Book is about using CIC to introduce exponential solutions. It is also about learning how to think exponentially and how to understand Risk.

The most important thing to understand about Risk is that risk is impersonal. Risk does not care if you are a good person. Risk does not care if you are doing something that you think is socially desirable. Risk does not care if  you do not have enough money to back up taking the risk, in case it materializes adversely. Risk always operates the same way, for everyone. Always. Every single time. It operates on the basis of circumstance and probability. If the risk is 20%, that means 20 times out of a hundred, thing won’t go well for you, and 80 times out of a 100, they will. If the risk is 80%, that means 80 times out of a hundred, things won’t go well for you, and 20 times out of a 100, they will. So, for example, 20% is a lower risk, and 80% is a higher risk.

Here are four "rules-of-thumb" in risk-taking. Of course, before you do anything, ask an expert(s), and  research as much as you can about the risk before you take it.

• If you are still uncertain, try to avoid taking the risk. 
• If you have to take the risk and still have no opinion about it, assume the risk is 50/50 or 50%, that is, it is equally likely to be favorable or adverse, and act accordingly. 
• If you have to take the risk and you have formed an opinion about it, use the 80/20 rule, that is, assume the risk is 80% likely to follow your opinion, and 20% likely not to, and act accordingly. 
• Remember Occam's Razor, which I like as a rule-of-thumb - "The simplest explanation is most likely the correct one". This is slightly misleading because "It is a principle that generally recommends selecting the competing hypothesis that makes the fewest new assumptions, when the hypotheses are equal in other respects . For instance, they must both sufficiently explain available data in the first place (whew! - sounds a bit like a Philadelphia lawyer, don't you think? ... but it does have the merit of being more accurate). http://en.wikipedia.org/wiki/Occam%27s_razor

One of the most significant aspects of Risk-taking and Risk-based Decisons is unintended consequences. This is where the saying, "It seemed like a good idea at the time" comes from. One of the reasons for this is that what follows a Risk-based Decision is dynamic and not static.

What this means is that people change their behavior because of a Risk-based Decision (and also because of the introduction of Incentives, which is critical to anticipate when using CIC), something which governments and even some businesses seem to fail to understand. There was a famous study by the US Government which estimated that there could be billions of dollars of additional tax revenues generated by raising the marginal tax-rate to 100% for incomes over $200,000. Nobody in the government seemed to realize that the day after its introduction the highest income in the United States would be immediately (and inexplicably to the government, I guess), $200,000! So, the additional tax revenues would, in fact, be zero.


What is the lesson  to be learned? People act in their own (hopefully, enlightened) self-interest. This is a key feature of exponential solutions, which make use of "the art of fighting without fighting". Risk-based Decisions can affect the Environment as well, which is also dynamic and  not static. Check out what happened after the construction of the Aswan Dam in Egypt about 50 year ago.
source: http://cstv.uwaterloo.ca/2010/03/dams-and-unintended-consequences.html
What is the Lesson to be learned?  Whether we like it or not, actions and inaction have consequences.

How does this relate to the real world?

When the natural limiting factor of the Financial Crisis occurred in September, 2008, we thought, because of the way we think, that it must be the 15th day. What terrified us was to be told by Treasury Secretary Paulson that it was really the 29th day. Suddenly, we were out of time. Fortunately for us, Paulson's response (no matter what you may think of some of the other things he has done) was an exponential solution which was implemented in time to avoid a complete financial collapse, obviously a much more significant 29th day. This is the subject of Chapter 3.

Right now, we are trying to resolve exponential problems with linear solutions, which are ineffective or worse, and which are ... just ... too ... slow. A good example is the 2009 US Economic Stimulus. It was a linear solution to an exponential problem. It has been ineffective and ... just ... too ... slow. The Economic Stimulus has not lowered unemployment, improved economic growth, or slowed down the approach of the US National Debt 29th day, let alone avoided it. What a difference it could have made if the solution had been exponential. This is the subject of Chapter 4.

What can we learn from this? ... Plain and simple, exponential solutions (pro-freedom of choice) can avoid 29th days, linear solutions (pro-control and coercion) do not. What is the difference between them? Why can one work (using incentives/self-interest and the "art of fighting without fighting")  and the other does not (using penalties/coercion and the "art of fighting by fighting")? Why can one be so quick and the other be so slow? How do we implement an exponential solution in time to avoid another 29th day? What role do CIC, Core Values, and the Messenger play? What is the "art of fighting without fighting"? This is what we need to understand. It is discussed throughout this Book. In my opinion, The Financial Crisis and The Economic Stimulus are particularly clear examples of exponential vs linear solutions. Other real-life examples, however, have been included as well. Their purpose is to help us figure out how to be successful in this new exponential world.


If you like, you can take your pick of 21st century exponential problems ... all now subject to limiting factors or 29th days. - US and World Economies, National Debts, Immigration, Demography, Health Care, Energy, Oil Exploration, National Entitlements, the "old" Media, the Disconnect between Citizens and their Political Leaders, Iran, North Korea, Terrorism. This Book discusses all of them, and encourages your input. If you have a better idea, I will include it in a future version of this Book. Several people have already contributed better ideas which are reflected in the version of the Book you are reading now. I have identified them at the conclusion of this Forward ... examples of Personal Power.

Have you seen any exponential solutions lately? If we continue to believe that we have plenty of time because it is only the 15th day, how long will it be before we are terrified by another 29th day and suddenly, we will be out of time ... again?

Make no mistake about it. There will be a limiting factor (29th day) to the exponential growth of the US National Debt. Guaranteed. Either we can recognize the approaching 29th day and act exponentially by using CIC to create incentives to reduce government spending, and/or increase taxes (don't forget we are trying to repair our economy), and/or find a way to grow our economy, enough to manage the Debt successfully, which would become our choice (see Chapter 9). Or, the Government can continue to act linearly and think we have plenty of time because it is only the 15th day and wait until the National Debt is large enough that our creditors refuse to continue to lend us money, resulting in US bankruptcy, runaway inflation, and the collapse of our economy, which would then become the government choice.

By the way, Standard and Poor's downgraded it's credit outlook for the United States Debt from stable to negative on April 18, 2011. Uh, oh. Wasn't that just about the time that Congress took a 2-week recess and the President left on a re-election/fund-raising tour? Doesn't that sound linear to you? - "We have plenty of time." Oh, and it was the first time that Gold closed over $1500 an ounce and gas over $4 a gallon. And the Federal Reserve is continuing to expand the money supply (you should take a look at Chapter 18). If you would like some information about the actual inflation rate, actual GDP, actual unemployment rate, etc., check out http://www.shadowstats.com/. It will confirm your uneasiness that the inflation you are experiencing seems to be a lot higher than the Government says it is.

The UK had a similar negative outlook rating which they reversed by implementing a Plan - a 25% reduction in spending, except for Defence and Health, and the lay-off of 500,000 government workers (the equivalent in the US would be 2,500,000). Do you think the US Congress and the President will implement a Plan that will be successful in reversing S&P's credit outlook for the US? 
source: Fox News. 



The secret to repairing Medicare and Social Security is to restructure these Programs without cutting them to ribbons. This is definitely possible.

There will be a limiting factor (29th day) to the exponential growth of US Health Care, including Medicare, as well. Also guaranteed. Either we can recognize the approaching 29th day and act exponentially by using CIC to create incentives which voluntarily encourage both healthier lifestyles and the widespread adoption of best medical practices  (IBM has this on the drawing board for its Watson computer), resulting in bending the health care cost curve, reducing health care costs, improving quality, and improving access, which would become our choice (see Chapter 8). Or, the Government can continue to act linearly and think we have plenty of time because it is only the 15th day and try to control the cost of health care: by eliminating waste and fraud (an effort which has been ineffective since 1965); by negotiating lower and lower Medicare reimbursement rates (and transferring the cost to the private sector) with members of the Medical Community until they refuse to accept Medicare patients, so that the elderly, in effect, lose their coverage; by forcing private health insurers to lower their premiums artificially, so that the private health insurance market collapses, resulting in rationing of health care, delays in access, and a decline in quality, which would then become the government choice.

On March 23, 2010, President Obama signed the Health Care Reform Bill into Law, nicknamed "Obamacare". In my opinion, this is another linear solution to an exponential problem. It can be reversed ... but will it? To everyone's surprise, on June 28, 2012 the Supreme Court upheld the constitutionality of Obamacare by re-interpreting the individual mandate provision to be a tax rather than a penalty. The irony is that even President Obama had argued that the mandate was a penalty rather than a tax. Ask yourself, "Is there any tax right now that taxes us for not doing something?" Isn't this the definition of penalty, or do we have now an expanded definition of tax.? It will be interesting to hear the political spin by both Parties. In any event, this raises the stakes for the 2012 US Federal Election.


I wish that the following point could be made in letters three-feet high. Social Security (and Medicare, if we don't repair Health Care, as outlined above and in Chapter 8) are going bankrupt. They are also exponential (check out Chapter 13, CIC and Entitlements, and Chapter 15, CIC and Demographics) and would have a limiting factor (29th day) eventually. They will be restructured or the Program(s) will implode. Here is the point that everyone should note and be prepared for it to be distorted. It is the single best area for scare tactics aimed at the elderly (that includes me, by the way). Nobody, and I mean nobody, will ever suggest that benefits be changed for folks over 55. So, a Big Message to everyone who is over 55 - When these Programs are restructured, your benefits are safe. Don't listen to anyone who says differently. They are just trying to scare you into voting for them. Ask yourself, "Do I really want to vote for someone who would say that just to scare me?". The one exception is mentioned in the preceding paragraph about US Health Care and I will repeat it here. "Or, the Government can continue to think we have plenty of time because it is only the 15th day and try to control the cost of health care by negotiating lower and lower Medicare reimbursement rates (and transferring the cost to the private sector) with members of the Medical Community until they refuse to accept Medicare patients, so that the elderly, in effect, lose their coverage."

Whatever we do will not be easy. Reducing spending means that someone is going to get less ... and they aren't going to like it. But the response of Government to a 29th day(s) crisis would be a meat-axe, indiscriminate, panic-driven cut in all spending. You know it and I know it. Look at what the UK has had to do. Is this what we want? We all know that this would be the wait-until-later end-game to a potentially tragic real-life drama. We all know that the longer we wait, the greater the sacrifice. So, do we want a shared sacrifice now, or do we want to SACRIFICE later? There are no other choices. It is time to Pay the Piper and he is standing on our door-step. There is no sacrifice-free solution. Oh, and since it is exponential, such a 29th day(s) would happen in our lifetime. Just in case anyone is thinking we can defer it for long enough that the next generation will have to deal with it and we can get a free-ride. This is our problem ... now and later.

Would you like to see the only Power strong enough to force Government to begin to act exponentially and create a different future? ... take a good long look in your mirror! We need to abandon linear thinking which is about using coercion and "the art of fighting by fighting" and learn how to think exponentially which is about using incentives to match enlightened self-interest and "the art of fighting without fighting" if we want to avoid another 29th day. And we need to learn how to use CIC and to understand Risk. And we need to be quick! That is what this Book is all about.

We are hearing already (April, 2011) a lot of political mumbo-jumbo and fuzzy math from most (although, not all) politicians about "lowering" the National Debt, and "controlling" Health Care Costs, over 10 or 12 years, of course, using unbelievably favorable assumptions about future economic growth, of course, using 10 years of projected income but only 5 or 6 year of projected expenses in the estimates, of course, avoiding any significant sacrifice until these politicians are out of office, of course. Do you remember Indiana Jones' famous line in "Raiders of the Lost Ark"? ... "Trust me!" I wonder if he got that from some politician? ... "Trust me, I'm from the government!" Am I being too harsh? Well, have we heard this kind of talk before?

Whatever you do, take careful note of the most dangerous promise in both politics and economics  ... "This time it will be different". And, as you well know, the Marquis of Queensbury Rules of fair play are not used here. Then use your common sense, which Americans have in abundance. You know what rings true and what does not. Do your own homework. Talk to people whom you respect. Don't be reluctant. This is the best way to become informed, to be able to separate fact from fantasy. Then use your own judgment. You will be making your best decision about what to support and whom to support. 

We have already paid the price for the exponential problem of the 2010 Gulf Oil Spill to find out that prohibiting low-risk options leaves us only with high-risk options. The argument for not drilling for oil domestically is bogus. We have to drill for oil domestically in order to sustain the US economy. Alternative energy viability as a substitute for oil is still in the far distant future. To think otherwise is naive and foolish at best and reckless and irresponsible at worst.


Let's get a grip on reality. If any of the top four sources of power were eliminated, how would we replace them? I am not saying that we shouldn't work to develop alternative energy. It's just that we shouldn't fantasize that alternative energy is viable in the short-term or even medium-term. Consider that working on alternative energy, which is wise, is not the same as having enough alternative energy to replace oil now. We have acted as though it was the same and so low-risk oil-drilling options have been prohibited. By the way, when President Obama visited South America recently (in March, 2011), he offered Brazil billions of dollars  (see March 22, 2011 and June 17, 2010 articles below) in incentives to drill for oil, which they would sell to the US. Does that make any sense to you?




Do you think it makes sense to George Soros? ... Does it make more sense to you now?

The result of linear thinking has been that because results from Alaska oil-drilling will not be available immediately and because environmentalists are against any drilling, we wait, as if this decision could be deferred forever without consequences. The risk we take is that, someday, because of an unforeseen crisis, such as in the Strait of Hormuz next to Iran, for example, long before alternative energy is viable, we are going to need Alaska oil immediately to sustain the US economy, and if we wait until that someday, we will be ten years too late.


We are paralyzed by the unending argument between those who want to drill for oil and those who want to protect the environment. Linear thinking is about either/or, (drilling or the environment) that is, maximizing or “We win, you lose”. This prevents sustainability. Exponential thinking is about both/and (drilling and the environment), that is, optimizing or "We cannot win, if you cannot win". This promotes sustainability. Will we continue to think linearly and say things like, "Oh, no, no, no, we cannot drill in Alaska. We cannot drill in shallow water. We cannot afford the risk to the environment."? Tell that to the people who live and work on the Gulf Coast.

The longer we wait, the more severe the consequences. If we continue to think linearly, someday we will experience yet another disastrous example of a 29th Day. Guaranteed. And yet, linear thinkers still say, "It is only the 15th day, we have plenty of time, we can fix it later". When that 29th day arrives, how many of us will think that it is only the 15th day? We have paid a terrible price already for mistakenly thinking that the 29th day was only the 15th day. Do you really think "We have plenty of time" to avoid another disastrous 29th day, even after our real-life experience staring us right in the face
... of waiting too long to avoid the 2008 Financial Crisis?
... or of waiting too long to avoid the 2010 Gulf Oil Spill?
... and now, hearing at the 2010 G20 Economic Summit that we are going to wait too long again, this time to do something about the US National Debt?

Linear thinking is making us act like we have a death wish!  What we are not doing is clarifying the consequences of doing nothing and making them real possibilities, perhaps because it is considered to be Politically Incorrect. Think about driving at top speed toward the edge of a cliff. What makes us put on the brakes is visualising what it will be like to go over the edge. We are acting like this is a TV reality show. It is not. This is real life ... your life. To put it bluntly, if we wait too long, the result is going to be worse than our worst nightmare. Many of you may think I am exaggerating or fearmongering, that somehow consequences can be avoided forever, just because we don't want them to happen. It doesn't work that way. Risk doesn't work that way. 

One of the consequences of the continuous bombardment to our senses by CIC in the modern world is that we have become immunized against the horrors and tragedies of world events. There tends to be an impersonal quality and a sense of unreality to the TV News. In my opinion, this has induced a sense of paralysis and helplessness in many of us to be unwilling or unable to do anything other than watch what is happening. We are becoming like the man who was asked for the definition of Ignorance and Apathy. His response was, "I don't know and I don't care".

My wife and I are approaching the end of a once-in-a-lifetime world cruise (April, 2011). How fortunate we have been to have had this opportunity. It has been an amazing experience. We have kept a diary (including pictures, videos, and wonderful write-ups by my wife) on a blog so that our family and some of our friends could share it with us. A little bit of CIC, eh? What has affected us most of all, however, is that during the cruise we were one day away from Christchurch, New Zealand at the time of the earthquake; we were off the coast of Japan at the time of the tsunami; we sailed through the Gulf of Aden, had a "pirate drill", and heard that there are three pirate attacks there each week. This has given us an indelible and clarified sense of reality that these tragedies involve real people living through their worst nightmares. We will never forget it. We will never get over it. I believe it has changed us forever. It has sharpened my focus that we must not, we cannot just "go about our business" and pretend that what is happening to our country has nothing to do with us, with our future ... that there is nothing we can do, must do about it. I find myself wanting to shout at the top of my lungs  to everyone, and even to myself, "WAKE UP!" ... wake up while there is still time to redirect the future ... before our worst nightmare begins.

In order to wake up, one of the things we need to overcome is the almost insurmountable barrier created by Political Correctness in the United States. Dare I take on this sacred cow ... well, somebody has to, so why not? It used to be that being polite, considerate, gracious, thoughtful, and respectful was socially acceptable. As a boy, for example, I was taught to aspire to the best qualities of life. My favorite book was "Ivanhoe". My children were taught to avoid the worst qualities of life. They studied the book, the "Pigman". Now, if my grandchildren watched TV and movies, they would be taught to expect the worst qualities of life. Have you seen a TV Reality Show lately? (Their parents are trying to avoid this by teaching them to be inspired). Is this an improvement or a decline in our expectations of the human condition? How many of us feel that we seem to be headed in the wrong direction? Personally, I find it somewhat discouraging.

I would argue that the next step in this progression is Political Correctness which has abandoned those best qualities of life and created a new definition of "socially acceptable", that it is no longer permissible to express what our common sense tells us is true, in case it offends someone ... anyone. In my opinion, this has become a powerful social weapon to justify attacking the character of anyone with the courage to mention the 800-pound gorillas in the room. Free speech, a cornerstone of our Constitution, is disappearing, unless it furthers the progressive agenda of the Politically Correct crowd (see Chapter 19). Have you noticed, for example, that It's not my fault has replaced red-blooded American? The Government's message, "It really isn't your fault, we will take care of you" has become Politically Correct. Is this what our country is all about? Is this what the early pioneers thought? Is this what our parents taught us? Is this what we should be teaching our children? Read Chapter 6, Core Values, and Chapter 7, CIC and the Family before you answer.

Is it even remotely possible, that one result of being buffaloed by Political Correctness is that we, you and I, have become part, maybe a big part, of the problem? Have we become the gimmee society? How many of us are willing now to say, "Take more money from the rich" (even though the top tenth of all wage-earners already pay 71% of all income taxes, and the bottom half (47%) of all wage-earners pay no income tax, right now - source:   www.ntu.org/main/page.php?PageID=6  .... and the  Internal Revenue Service - 2007), "Leave me alone, I didn't create this problem, and I can't do anything about it ... it's not my fault", "It's the government's job to fix this mess", and "Don't ... don't even think of asking me to sacrifice, to take personal responsibility for it, I've got enough problems". Maybe we need to remember what Pogo, a character in a clever comic-strip from 50 year ago said, "We have seen the enemy ... and it is us". That's not something any of us wants to hear, is it? But is it even remotely possible that it might be true? Consider, for example, that in mid-July, 2012 the Obama Administration decided to waive by Executive Order the work requirement of the landmark welfare reform legislation passed by President Bill Clinton and Congress in the 1990's. This requirement was the centerpiece of the legislation, considered by President Clinton to be a major part of his legacy. Is this a step forward ... or a step backward?

Isn't it long past time for us to say, "Enough is enough!"? Isn't it long past time for us to have the courage to confront Political Correctness for what it is - a way to suppress Free Speech, which is preventing us from honestly and sensibly expressing what we really need to be doing  to deal effectively with the National Debt, with Immigration, with Foreign Policy, etc. etc. etc.? Are we up for it? These people are experts at ravaging the character of anyone who disagrees with them. Have you noticed that this is what they do instead of debating the real issues facing us? Well, I say it is fish-or-cut-bait time. It is red-blooded American time. Let's show them what we think of bullies, let's show them what we think is right. Do you think they will be willing to engage in an honest debate? Or, will they just fire the only arrow they have in their quiver and attack our character? Remember what Socrates (469BC - 399BC) the Greek philosopher said, When the debate is over, slander becomes the tool of the loser. Well, if that's all you've got PC people, "Take your best shot". We know that the only way to deal with bullies is to stand up to them, call their bluff, and make it crystal clear to everyone that they are "full of sound and fury, signifying nothing". That is what makes bullies crumble. Don't you think it's about time we started acting like red-blooded Americans again? Of course it is! ... Here's hoping I haven't given the Politically Correct crowd a collective heart-attack ... just a good kick in the pants!

While Political Correctness has done a lot of damage to Free Speech in America, there is at least one area where it has focused attention on a problem which must be resolved ... Immigration (Chapter 14). Immigration is a hot topic in the United States today, especially Illegal Immigration. The central question about illegal immigration in the US, for almost all Americans, is, "Why in the world does the US Federal Government seem incapable of  resolving this issue ... is it incompetence, is it partisan bickering ... or ... is it something else?" Well, let me attempt to answer that question.

There are two characteristics of illegal immigrants that stand out - cheap labor, and potential future voters.

• They have low expectations. The per capita income in Mexico, for example, is 25% of the  per capita income in the US.

• The rapid population growth in Mexico, for example, means fewer jobs there, especially for young people.

• They are easily exploitable because they are illegal and can't complain.

• There are now 12-16 million or 7-20 million illegal immigrants in the US, depending upon whom  you ask. Granting amnesty would create a very significant number of new  voters.

To put it bluntly,

• this kind of cheap labor is just another form of slavery,

• trying to make them voters is just blatant manipulation of them and of the democratic process.
  

We ought to be ashamed of ourselves.

In the meantime, because the US has stopped enforcing existing Federal Immigration Law (whatever happened to "We are a nation of laws"?),

• there are now "sanctuary cities" in the US for illegal aliens,

• they are receiving welfare, education, and other social services, to the severe detriment of State Budgets.
  

• the "open border" has substantially increased drug traffic and violence,

• Arizona has become the area of choice in the Western world for kidnapping,

• it has become easier to ignore or not enforce other laws,

• the US is losing its confidence and stature in the arena of foreign affairs,

• it has become Politically Correct to label, as a racist,  anyone who wants to enforce existing Federal Immigration Law, 
  

     ... and on, and on.

Recently (September, 2012) I read a Time Magazine article written by a journalist who has admitted publicly that he is an illegal alien and still cannot find out from  US Immigration and Customs Enforcement (ICE) whether or not  he will be deported.

US federal politicians have come up with a laundry list of reasons to follow the statement, "This is why we can't fix the illegal immigration problem right now." The US has been singularly unsuccessful in securing the US/Mexican border. Rudy Guiliani says he could do it fairly easily. Perhaps the US should hire him. Look what he did for New York City. Does this sound like the United States? The "can-do" country? The country that is a "nation of laws"? Or, does this sound like a country that has lost its way, to the severe detriment of American self-respect, and loss of international prestige?

Sorry about that. Actuaries aren't supposed to get emotional, but I just had to get that off my chest. Everyone is nibbling around the edges of this issue, but nobody is "telling it like it is." More importantly, however, "telling it like it is" is the first step in designing an Exponential Solution.

There is a moral issue here which, in my opinion, suggests a solution to this problem. The reason the United States does not have a corresponding problem with other people who break the law is because existing laws are enforced and such  people are brought to justice. While some of them may never be caught, they are still considered to be criminals and the intent of the legal system is to find and prosecute them. For some crimes, there is a statute of limitation which says that they can no longer be prosecuted after a defined length of time. In effect, at that point, the government can no longer enforce the law and such people are treated as if they were innocent. This is the foundation of our legal system.

The reason that there are at least 10 million illegal immigrants in the United States is because the federal government has decided voluntarily not to enforce existing law. While it may be difficult to enforce the law, surely the solution cannot be to abandon enforcing the law. The cause of the illegal immigrant problem, therefore, is not illegal immigrants, it is the federal government (both Democrat and Republican administrations, by the way). The result is that illegal immigrants are living and working in the United States as if they were citizens but must live in the shadows because of their uncertainty about whether or not they might be deported. So, they have none of the legal protections citizens have which means they can be exploited and mistreated with impunity.

The moral issue needs to be stated with clarity: "Is it moral for the United States to treat any himan being this way?". I would state categorically that the answer is "No!". It seems to me that two things have to happen to begin to correct the illegal immigration problem. 1. The United States (including the Federal Government, States, and Sanctuary Cities) has to state unequivocally that, after a certain date, all immigration laws will be enforced and anyone entering the country illegally will be subject to prosecution ... period. Whether or not it is difficult to do so is irrelevant. 2. Anyone who is in the United States illegally before that date will be allowed to apply for citizenship as the moral resolution of the federal government's failure to enforce existing law. My thanks to the Politically Correct crowd for making this an issue. While I do not agree with how they did it, I applaud that they did it.

Believe me, I understand how busy you are, how unreasonable it must seem to be asked to do something more, especially something which seems to be so difficult, so impossible. OK. How about this? Try doing one small thing each day, or each week ... just one small thing. In my opinion, that could be enough, if enough of us are willing to do it. Try it just once ... one small act. The sense of Personal Power you will feel will motivate you to do it again. Are you saying to yourself, "I am nobody, what difference could I possibly make?" I understand that because I am nobody, too. We have one other thing in common which is what gives us Power. We are free!

Just remember, in this new exponential world, one person can make a difference. You can make a difference. And remember the lilypad. It may look like nothing has changed ... but it has! Guaranteed. Whether you agree with him or not, be inspired by the exponential experience of President Obama, someone who came from nowhere ...and in just a few years, became President of the United States. And we don't want to become President, we just want to make a difference. As President Obama has said, "Yes we can!".

One of the advantages of an online Book is that it can be updated easily. Fast forward to July, 2011. Reflect for a moment on the events of the past year or so since the G20 Economic Summit. Have you noticed the word "crisis" appearing more often in the media? Have you noticed any 29th days approaching
   
Consider what has happened as of April 12, 2011 to the nuclear reactor(s) affected by the terrible tsunami which has devastated northern Japan. We were told by "nuclear experts" a few days after the tsunami that:

• there was no risk of an extensive release of radiation because of the concrete containers surrounding each reactor - at least one of these containers now appears to have cracked. 
• the uranium and/or plutonium concentration was too low to be dangerous - radiation levels around the reactor(s) are now 100,000 times normal. 
• this could not be a "Chernobyl" - the Tokyo water supply now contains radioactive iodine. Highly radioactive water spilled into the ocean off a tsunami-damaged nuclear power plant Saturday, April 2. AP - Workers used a milky white dye Monday (April 4, 2011) as they frantically tried to trace the path of highly radioactive water gushing near Japan's tsunami-damaged nuclear plant and seeping into the ocean. On April 12, Japan raised its nuclear accident rating to 7, the highest number on the scale.

Inadvertently, what was considered once to be "low risk" now appears to be "high risk". I am not trying to frighten you unnecessarily or speak against nuclear energy. What I am trying to do is demonstrate (as with the 2010 Gulf Oil Spill and the Economic Crisis of 2008) that we need to understand Risk a lot better than apparently we understand it now.

The US Deficit is now projected to be at least $1.5 trillion for FY2011. The compromise to avoid a federal government shutdown saves less money than was borrowed during the debate on the Bill. Thus far, there have been no serious visible discussions about substantially lowering spending, particularly with respect to entitlement programs. The next political battle (as of April 12, 2011) is raising the Debt Ceiling, so that the US can continue to borrow more money (Why do I have a picture in my mind of Nero fiddling while Rome was burning?). Individual US States are beginning to see their deficits substantially increase as the one-time effect of the Economic Stimulus Program begins to disappear.

Debt ceiling — The U.S. government is about to max out its credit, prompting a likely vote in Congress to raise the debt ceiling, now set at more than $14 trillion. Several recent national polls find that the public is resistant to extending more credit but aware that not doing so could have great consequences. In a Gallup Poll  last week, a 47 percent plurality would want their member of Congress to vote against raising the debt ceiling, compared with 19 percent who would favor it and 34 percent unsure.

A CNN poll from early May provided more detail in its question about the debt ceiling than did Gallup. It found more people in opposition than in favor of raising it, 60 to 37 percent, with fewer undecided than Gallup. Both polls found wide partisan gaps; at least seven in 10 Republicans reject expanding it, while Democrats favor it in a more narrow way. Independents reject it in both polls, though not as widely as do Republicans.

Despite the desire not to raise the debt ceiling, the public sees potential problems if that is not done. In the CNN poll, 58 percent say there would be a crisis or major problems if it isn’t raised. A similar 56 percent said not raising it would be “disastrous to the U.S. economy,” in a new Battleground poll from George Washington University and Politico. 

source:http://www.washingtonpost.com/blogs/behind-the-numbers/post/poll-watchers-public-attitudes-about-the-debt-ceiling-the-value-of-college-economy-as-the-top-problem-and-
accepting-homosexuality/2011/05/11/AF1RA24G_blog.html

We are witnessing the exponential phenomena of low birth rates and, therefore, fewer workers to pay for social programs in Europe, resulting in efforts by governments to increase the retirement age. This has been coupled with high birth rates, and, therefore, more young people looking for work, and inadequate economic growth to create enough jobs in Africa and the Middle East, resulting in unacceptably high rates of unemployment. Do not underestimate the unfortunate opportunity this presents for the shameless manipulation of desperate populations. Recall what has happened in Iran since the abdication of the Shah in 1979.

The visible evidence of recent events is US Republican and Democratic rhetoric about the impact of a possible shut-down of the government and raising the debt-ceiling, the confrontation between the Governor and the teachers' union (and some national unions) in Wisconsin (and now across the United States) over balancing the state budget by restricting collective bargaining and by increasing teacher contribution rates to their medical and pension benefits (still below contribution rates in the private sector), and the powder-kegs of riots/ protest demonstrations in Greece, Spain, Portugal, Ireland, France, and the UK in Europe (and now in London and even in the United States), as well as riots/ civil wars/protest demonstrations in Tunisia, Egypt, Yemen, Jordan, Bahrain, Algeria, Libya, Albania, Morocco, Syria, and Iran in Africa and the Middle East, along with the ubiquitous emergence of the Muslim Brotherhood.

All of us have watched the peaceful demonstrations of the Egyptian people, using CIC to communicate with the world (many of the signs in English so we could read them when they were reported on TV), causing Hosni Mubarak to resign after 18 days. As of March, 2011 all of us are watching what is happening in Libya. My own view is that the present Libyan regime will fall but time will tell. This evidence of recent events is the subject of Chapters 9, 13, 15, and 16 on the US National Debt, Entitlement Programs, Demographics, and Immigration.

How many of us are thinking it is the 15th day and we still have "plenty of time"? ... Are you?  In my opinion, we are now well past the 15th day and close to one or more significant 29th days. By the way, keep an eye on the Strait of Hormuz, the Suez Canal, and Saudi Arabia (they are not immune to this upheaval); also on South Africa, with 27% unemployment in the cities and 60% in rural areas (Its annual economic growth rate of about 3% can handle population growth but will not reduce unemployment, particularly with more and more rural workers moving into the cities); also on the embryonic development of a mysterious online call for a "Jasmine Revolution" in China, with only a handful of people, at this point, joining protests apparently modeled on the pro-democracy demonstrations sweeping the Middle East. I will also mention the exponential tragedy of AIDS, particularly in Africa. What an example of real people living through their worst nightmare. This horrible disease will change Africa dramatically for generations.

On the supply side of things, keep an eye on the drought threat to China's 2011 wheat production, food shortages, as well as the impact of rising world food and oil prices, and emerging efforts by countries to nationalize their water supply. If you haven't heard about Peak Oil, which is the point where oil demand outstrips oil supply, you should check it out. source: http://en.wikipedia.org/wiki/Peak_oil. Also, you might want to think about the consequences of excessive population growth in any species, including us. Limiting Factors are appearing on the horizon in all of these areas.
 
If I'm right about CIC, then creative solutions will begin to surface, not directly from governments, but from individuals. Egypt is one example of CIC's exponential power. These solutions are somewhat uncontrollable but definitely dramatic in reshaping the future. CIC can be used for good or for ill. My pitch is to encourage those people in favor of Liberty to examine their Core Values and to speak out now so that they can have a say in the direction of our future. To paraphrase Thomas Jefferson, "The only thing evil requires to triumph is for good people to say or do nothing".

The future is being redirected right now. And in this new exponential world, individuals will make the difference. The punch line is that we do not have as much time to do so as we may think. My hope is that individuals with creative solutions and the courage of their convictions will use CIC to make themselves known and take a stand. Who knows, you might be one of them. What gives CIC its power to redirect the future is when thousands and even millions of us use CIC to stand with them and show our support. This is what just happened, for example, in Egypt.

If your political representative, or someone in your neighborhood, or your school, or your church, or on TV, says or does something with which you agree, then tell them, send an email of support, go to a rally, tell your friends. Email or talk to people about your own suggestions.  As important, is what William Penn said, "I expect to pass through life but once. If therefore, there be any kindness I can show, or any good thing I can do to any fellow being, let me do it now, and not defer or neglect it, as I shall not pass this way again." If enough of us do it, we will be using CIC to redirect the future. Don't wait to do it 'someday'. Be like Nike, 'Just do it!'. I believe it is guaranteed that you will feel  a sense of Personal Power ... that you will be redirecting the future.

Speaking of redirecting the future, all of us heard that on May 1, 2011 Osama Bin Laden, the head of the snake, was killed in Pakistan by the CIA/Navy Seals, and then buried at sea. This suggests that, for a brief time, Al Qaeda will be vulnerable. If we were to couple Osama Bin Laden's demise with the Freedom Movement in the Middle East and Africa, is there a moment of opportunity which can be framed by the following question: "If the people of the Middle East, particularly the young people, really want Freedom, can the United States work with them to ensure that Al Qaeda's time has come ... and gone?" At the risk of sounding like a broken record, we need to abandon linear thinking which is about using coercion and "the art of fighting by fighting" and learn how to think exponentially which is about using incentives to match enlightened self-interest and "the art of fighting without fighting" if we want to avoid another 29th day. And, of course, we would have to be quick!

But be warned! There are those who will try to persuade you not to think exponentially. They will say it is silly, meaningless, unnecessary, gibberish. They are the same ones who will try to control the Internet, to prevent you from using CIC, to prevent you from gaining personal power. They practice CI rather than CIC. As you might expect, CI stands for Creativity and Information but drops Communication. The power base of CI is information hoarding (concentration of power) versus CIC's power base of information distributing (distribution of power). This is the subject of Chapter 2. These two power bases are clashing right now. Here are two of many examples. Did Americans (CIC) agree with the way the Government (CI) handled Health Care Reform? Do most Politicians (CI) like the Tea Party Movement (CIC)?

Notice how the Chinese and Iranian Governments (CI) have been trying to control the Internet already. Have you noticed anybody talking about controlling the Internet in the US? You should be listening very carefully. It is in their best interest to do so because they want to control you.

Here is the kicker if you are willing to do this. The catalyst for changing the future, for changing the world, is you, and millions and millions of ordinary people just like you. Because this is the way you can gain personal power and then use it. All you will need is desire, a personal computer, access to the internet ... and an open mind. I'm not going to kid you. This will not be a walk in the park. It will take focus, effort, determination, boldness, and a willingness to consider new ideas. Some of you, perhaps many of you, will decide it is not worth it, or perhaps that I am just whistling in the wind. But I do invite you most urgently, "Join with me!" And I say to you as passionately as I can, "Don't let someone else decide your future for you, for your children!"

The hardest part is that it will take time ... time you are using now for something else. Not the time you are using earning a living or raising your family ... but some of the time when you are watching TV, playing video games, reading the newspaper, "shooting the breeze", interacting with others ... time when you are free to do what you want. You will have to decide that you want to do this more. Sort of like saying, "I am going to go on a diet, I am going to start exercising." Only this time (no pun intended), you will have to actually do it. This is the subject of Chapter 7. Hopefully, this Chapter also will enable you to find more time. It means that you will have to decide what is most important to you, what are your Core Values, what is your true enlightened self-interest, what is really at stake here. These are things we don't think about very often, certainly not often enough. But doesn't pursuing them reflect the essence of who we are? This is the subject of Chapter 6.

It will not be easy. Most of us panic at anything mathematical. Perhaps, we should avoid using the word mathematical and just think of it as an idea. We may even want to call it 21st century thinking rather than exponential thinking. To make it easier, there are no mathematical symbols in this Book, just analogies, stories, and examples, which even I, supposedly a mathematician, have found to be more effective. Because the important thing is to get the idea into your head. This is the subject of Chapter 1. Please forgive me if at times I may sound condescending. I do not mean to but I know the psych-out effect mathematics can have on some people. It happens to me with art-history, biology, and yes, even sometimes, mathematics.

I don’t have all of the answers. Far from it. I am simply someone who just wants to share ideas, so perhaps we can make some sense out of this confusing world in which we find ourselves. I am in the process of learning about how CIC works, and no doubt you will find places where I haven’t got it right. I hope so. Because I am counting on your comments and criticisms to make this Book better. But, most of all, I am counting on you to learn about CIC and how to use it, so that together, we can change the world. 

One final comment. Much of this Book is about redirecting the future through individual Personal Power. I have mentioned four aspects of it - how you can use it (CIC), how little time you have to use it (Exponential Compression), whether you will use it (Character), what you will do with it (Core Values). There is a fifth aspect of Personal Power and I would ask you to reflect on it for a moment or two - what is its most effective Source?

• Is it Thinking? - like Albert Einstein, Sir Isaac Newton, Immanuel Kant. 
• Is it Charisma? - like Bill Clinton, Frank Sinatra, Ronald Reagan. 
• Is it Control? - like Saddam Hussein, Joseph Stalin, Genghis Khan. 
• Is it Creativity? - like Thomas Edison, Salvador Dali, William Shakespeare. 
• Is it  Non-Violence? - like Mother Theresa, Martin Luther king, Jr., Mahatma Gandhi. 
• Or is it God's love (Agape - http://en.wikipedia.org/wiki/Agape) flowing through you into the world?  

                                                                                                                      

Decades ago, the Evangelist, John Guest, said, "What is needed in the world today more than anything else is a 'change of heart' ". I think he was right.

By the way, this is what I wrote in Chapter 19. "Since this Book was first published in the autumn of 2009, only a few thousand people have read some part of it. There are several reasons for this.

• I am not famous or powerful.
• I am  not particularly a good writer.
• The subject is complicated and abstract.
• There is an enormous amount of "background noise" of information, stories, etc. created  by the internet, TV, and other communication outlets, that is, by CIC.
• Most people are overloaded with other concerns.
  

It is entirely possible that nobody will ever see this Chapter, let alone read it. I am not complaining. This is reality, particularly if my ideas about CIC are not valid. Am I disappointed? I would be if I thought linearly, or if I wanted to be famous or powerful which I do not. Only a few thousand people sounds insignificant. But I am a mathematician and think exponentially. So I remember the lilypad. On the 30th day, the lilypad covered the entire pond. Yet, on the 15th day it covered only  0.003% of the pond. Remember? And CIC is exponential. This may happen, as well,  when you begin to use CIC. Don't be discouraged if you don't see results immediately. They will be there!

Remember what I said in Chapter 4 about focusing on what is important, which, in this case, is the widespread understanding and use of CIC to create exponential solutions to our 21st century exponential problems, and redirect the future ... our future. I am counting on some of the few thousand people who have read even part of this Book to mention CIC and this Book occasionally. Perhaps a better writer than I am will expand on these ideas. If what I have written about CIC is valid then that should be enough. In effect, this is "the art of fighting without fighting" and my part in this process is completed with this Book. So, am I content simply to make this Book available to anyone who chooses to read it? Truly, I am. This means to me that what happens now is up to you."

Right now, Exponential Power is working against us. So is Concentrated Power. We need to change that ... and we need to be quick! The CIC-Revolution has begun. 
             
In summary, this Book is about whether or not we can/will redirect the future by learning about CIC and Risk, implementing exponential solutions, and avoiding the 29th day(s) which will trigger a centuries-long transformation of our future. As I said at the end of Chapter 19, "Wait! ...  Did you hear that faint sound ... It is the sound of Freedom ringing ... Will you answer its call?"

We don't have a lot of time. Remember the lily pad. Whether we like it or not ... the exponential clock is ticking.

tick ... tick ... tick.

For the moment, the choice is still ours. The price-tag is our future.

George L Berry, Actuary
July, 2011

Better Ideas
1. Thanks to my wife, Margot, for a better idea with her practical suggestions about the use of down-to-earth language.
2. Thanks to Pete Berry (my son and editor, also an actuary), for a better idea about Complex Adaptive Systems. It appears in Chapter 2, and eventually will be a separate Chapter 3.
3. Thanks to Cliff Swartz for a better idea. It appears in Chapter 8, CIC and the Lottery, Appendix 1, as number 6.
4. Thanks to LifeIsGoodStill for better ideas. They appear as Chapter 7, CIC and the Family, and in Chapter 10, CIC and Health Care.
5. Thanks to Richard Pellek for a better idea. It appears in the Forward. To quote part of my response to his email, "What you have made me realize, and I thank you for it, is that I have not clarified your second point enough, that is,  "Exponentials can be demonstrated mathematically, and they make sense to use them if there are no limiting factors, but there are always limiting factors."
6. Thanks to Sally and Ross Wilson for a better idea. Their comments have helped to clarify the Forward.
7. Thanks to my son, George, (also an actuary), for a better idea commenting about the supply side of things, which appears in the Forward.
8. Thanks to Dan McCarthy, (also an actuary, and one of my partners at Milliman, Inc.), for a better idea with comments he made years ago (before his untimely death) about duty and responsibility. Their influence appears throughout this Book.


                                                               ****************************






      A journey of a thousand miles begins with a single step.
          Confucius (551BC - 479BC) Chinese philosopher  

 


 

This Force, which I call CIC(kick), has had three effects:

1. CIC transfers power from institutions to individuals.
(e.g. the CIC-using Tea Party Movement)
So now, individuals can use CIC, and have a very big say ...
in everything.

AND...

2. CIC speeds up the rate of change ... exponentially.
So now, traditional solutions, which are Linear, are too slow ...
(e.g. the 2009 US Economic Stimulus)
CIC can be used to create Exponential Solutions
for 21st century Exponential Problems.

 AND ...

3. Risk, which is a Change Accelerator, is now accelerating CIC-activated Exponential Change
(e.g. the September, 2008 Financial Crisis)
So now, we must consider Risk carefully ... instead of ignoring it.

•  Why Citizens feel so disconnected from Government.
• Why there was a 2008 Financial Crisis.
• Why the 2009 Economic Stimulus didn't work. 
• Why the US/Mexican Border has not been secured.
•  Why the 2010 Gulf Oil Spill happened.
• What is really happening in the Middle East.
  
• Where we will be in 10 years … in 50 years. 
• The Mother of all 29th days ... where are we headed ... and with whom?
  

•  What we can do about what is happening.

Probability and Risk work like this:

0% is ABSOLUTELY NO

100% is ABSOLUTELY YES

1% up to 99% is INCREASINGLY MAYBE

so, for example, 10% is a weak maybe, and 90% is a strong maybe

This book is about how you and I can change the future ... really change the future ... for the better. All you will need is desire, a personal computer, and access to the internet. In the 21^st century, for the first time in history, we are living in a drastically different world. It is filled with visible "exponential" or rapidly accelerating  problems, which require "exponential" or rapidly accelerating solutions. Instead, we are attempting to solve these problems with "linear" or non-accelerating solutions … and they are just too slow.

For almost twenty years, I was a consulting actuary, Fellow of the Society of Actuaries (FSA) and Member of the American Academy of Actuaries (MAAA), in health care financing with the international consulting firm, Milliman, Inc. Actuaries are not very well known. That may be because they do not have the most dynamic personalities in the world. My wife just told me she actually saw this in a book she is reading, "Aargh. I look so boring. Like an actuary or something. I need ...something else." 

source: "Remember Me", by Sophie Kinsella

My clients included most of the US Blue Cross/Blue Shield Plans, including their share of the Federal Employee Health  Benefit Program (FEHBP), many Commercial Health Insurers, a very  large Health &Welfare Plan, and a variety of other clients.

I worked with them because they were  the organizations that did the health care financing. Early in my career, I testified before a Congressional Sub-Committee, and later, a number of State Government Committees, and at a large number of State Insurance Department Hearings. I did a lot of public speaking ,,, everywhere, to try and share, in plain language, what I thought was right about health care financing, and what I thought was wrong with it.

In 1993, I discovered CIC(kick)… in 2009, after personal computers and the internet had been well established, I found a practical use for it. CIC is what I call the force which has been unleashed by the widespread use of personal computers and the internet. It is the reason why so many things seem to have sped up, why so many :solutions  seem just too slow. The letters of CIC represent  the combined "exponential" force of Creativity, Information, and Communication. You have seen it…. You just don’t call it CIC. CIC can be used everywhere. I am thinking, for example, of the young lady, who made a video, went on YouTube, and successfully got her credit card interest rate changed back to 12.99%, from 30%. That was CIC at work. I am thinking of what US Secretary of the Treasury Paulson did to avert a financial crisis. That was CIC at work, too. Because of CIC, power in the world is being rapidly transferred from institutions to individuals, to people like you. If we gain an understanding of CIC, and how it works, I believe it will give us, as individuals, the tools we need to change things … in a very big way.

• Chapters 1 and 2 explain the 29^th day, what CIC is, and how it works.
• Chapters 3-11, are real-life examples of how it can be applied, to show how it can offer a way to "exponential", rather than "linear", solutions.
• Chapters 12-18 look at the global and economic effects of CIC and exponential power.
  
• Chapter 19 looks at the Future ... and the Mother of all 29th days.
• Chapter 20 is the Conclusion of the Book.

This book uses pictures, analogies, and stories, rather than mathematical symbols, to explain some mathematical ideas, like “linear”, and “exponential”, because the important thing is to get the idea into your head, rather than the mathematical symbol for it. I don’t have all of the answers. Far from it. I am just learning about how CIC works, and you will no doubt find places where I haven’t got it right. I hope so. Because I am counting on your comments and criticisms to make this book better. 

But, most of all, I am counting on you to learn about CIC, and how to use it …so that together, we can change the world. As we approach the 29^th day, the exponential clock is ticking.

 

tick … tick… tick     

****************************

If you would like to read the rest of this book, you can purchase the E-Book or the Paperback Version online.