Tag Archives: Larry Summers

Spiral Dynamics and MEMEnomics in Collaboration to Design the Next Global Financial Architecture 

Dr. Don E. Beck and I will be keynote speakers at the 75th Anniversary of the Bretton Woods Financial Conference this July which is taking place at the same center that held the original conference that changed the world. This invitation came about as the organizers of the conference, under the leadership of the late Bernard Lietaer, the co-designer of the Euro, studied my book MEMEnomics. The group then decided to gain a deeper understanding of Spiral Dynamics by studying Dr. Beck’s original book on the theory.  I was fortunate enough to meet Bernard in Boulder, CO in the mid 2000’s when he attended an event led by Dr. Beck. Then as fate would have it, we met again in 2013 in New York as we shared the same media publicist that was promoting our respective books.

The theme of the upcoming conference is Economics at the intersection of Humanity, Technology, Ecology, Governance and Markets. Dr. Beck and I will be the opening speakers on the first full day of this In-conversation-with conference format. The organizers would like our opening (in their words) to be a showcase of Spiral Dynamic to prime participants to start thinking differently about economic systems.

There will be many prominent attendees and speakers like Larry Summers, who was President Clinton’s Treasury Secretary and President Obama’s Chief Economic Advisor. I offer an analysis in my book about how Mr. Summers,  while in the Clinton White House contributed to the 2008 financial crisis by not heeding the calls of banking industry watchdogs to get Congress to regulate financial derivatives as gambling instruments. Then under President Obama, Mr. Summers replaced Paul Volcker as the incoming economic advisor for the fear that the addicted banking industry might not be ready for the type of regulation Mr. Volcker wanted to see.

Other speakers include the Director General of the European Central Bank and several EU Parliamentarians. From the private sector, Peter Thiel the co-founder of PayPal, and Patrick Byrne, CEO of online giant Overstock will be among many digital economy entrepreneurs attending. Other organizations represented include: The IMF, New America, Poverty Action Lab, Council on Foreign Relations, The Buckminster Fuller Institute, National Geographic, CARE, The Nature Conservancy, MIT Innovation Lab, The Financial Times, The Schumacher Center, & The Institute for New Economic Thinking. Of people known to the Integral and Spiral Dynamics communities, Charles Eisenstein is scheduled to speak as well. Charles is the author of several evolutionary consciousness books including Sacred Economics, and Climate, A New Story.

The Evolution of Bretton Woods

The original 1944 conference was organized by US President Franklin D. Roosevelt who invited delegates and heads of states from 44 different countries to create a post WWII economic and financial blueprint. John Maynard Keynes, the most prominent economists at the time was the master architect behind the conference that gave the world the current global financial and economic order. This was the event that gave birth to so many institutions born out of a new global paradigm on peaceful trade and development. It made the US the economic superpower it is today. It gave the world the International Monetary Fund and The World Bank, and made the US Dollar the de facto reserve currency for the world. It also gave us a preview of how a resilient Blue system (regulatory structure that understands economics) in government can direct economic policies and nudge a culture towards systemic prosperity by providing smart regulation that anticipates the Orange system’s (free market capitalism) every move and keeps its exploitation in check.

These values, which represent the Patriotic Prosperity Cycle in my book, were with us until the 1970’s when runaway inflation and  budget deficits made it impossible to keep the dollar pegged to the gold standard. That’s when President Nixon allowed the US currency to float and become a fiat currency backed only by the word of our government. The cycle entered the decline phase thereafter as Germany left the Bretton Woods Agreement, and the world was hit by the first Arab oil embargo. Its final entropy phase came during the Carter years when any and all measures of Keynesian economics failed to tame double-digit  inflation and runaway interest rates that were choking any meaningful economic growth.

As Keynesian economics waned in the US, it was replaced, with much fanfare by Monetarism, with Milton Friedman as its ideological father. This is the Orange economic phase I call the Only Money Matters Cycle in my work. Beginning with the Reagan presidency, the institutions created by Bretton Woods shifted from a trade, reconstruction, development and humanitarian mission, to mostly a banking function motivated by profit. Today these same institutions are the main reason why less developed countries remain in a perpetual downward spiral of debt that can never be repaid. (Click here to read my 2009 published piece  about the value systems structures that made this possible).

The push to develop the entire world into this peaceful commerce paradigm went into high gear under the Monetarist ideology and became instrumental in continuing the goal of ending wars against each other. But, as we came together to end wars through the virtues of free markets, and an insatiable appetite for consumption, we collectively and inadvertently waged a slow but deadly war against Mother Nature’s key ecosystems.

This will be the monumental challenge this conference needs to address. It seems that from the diverse list of attendees, speakers and the institutions  represented, this might just be the right place to start work on a new blueprint that reframes human activity as part of the planetary ecosystem. While the conference might not hold the same CAPI* the original conference did 75 years ago,  the hope is that it can inform leaders on the type of institutions we need to design to effectively address the existential threats we as a humanity have collectively created for ourselves and the planet.

Although the event itself is not open to the public, here’s the link to its website for more information. https://www.brettonwoods75.org/

*CAPI stands for Coalescence of Authority, Power and Influence. It’s is an advanced Spiral Dynamics concept adopted from the Adizes Institute. It’s presence as a representation of systemic stakeholders, is an essential ingredient in the design of Large-Scale transformational systems.  


Is there a Shakeup in Obama’s White House?

The same public discontent that elected Scott Brown to the US Senate seems to be making its way through the White House. So long Ivy League thinking (healthy ENTERPRISE  intelligences), and hello dysfunctional LIFE CONDITIONS, or so admitted our President in a recent interview with ABC News. One of the areas of greatest dysfunction in his administration’s first year, in my opinion has been the ill-advised approach on how to regulate the financial industry. Here’s the noticeable change in our President’s approach as his thinking grows on the job

When the financial crisis was still brewing, speeches by our President-elect were full of what people wanted to hear about re-regulating banks as seen by his head of economic advisers at the time, Paul Volker. As former head of the Federal Reserve, and a Goliath in taming inflation, Volker wanted to separate investment banks from commercial banks (just like they were for 60 years before Clinton de-regulated them). Volker had an untainted view on re-establishing the  ORDER value system (vMEME) to an industry plagued with clever speculation of a FEUDAL vMEME  at a systemic level.  Once Obama took the helm, Volker was sidelined in favor of Larry Summers, Wall Street’s darling who lobbied for deregulating banks and banning any regulation of the derivatives market during his time in the Clinton administration. Many economists argue that these two factors were the major contributors to the global financial crisis.

During the past year, while millions of Americans continued to lose their jobs and the number of homes in foreclosures climbed to over 5 million, Wall Street recovered at a record pace knowing its guy was advising the White House (injecting it with a false ORDER vMEME). Only after the loss of 2 gubernatorial seats and one senate seat to the republicans did the President realize that all is not well with the electorate and that the anger of the tax payer can indeed make him a lame duck President by the time he’s 2 year into the job. Deciding to turn back to Volker’s recommendations immediately after Brown’s election was the first  move from a SYSTEMIC vMEME the President has made since his election. As proof, since the President introduced “The Volker Rule” on Tuesday the Dow Jones has dropped more than 5% and the vultures in the financial industry are running to the exit doors.

It remains to be seen if the President has the capacities to transcend “pragmatism” (healthy ENTERPRISE vMEME) to a “systemic thinking” vMEME in formulating all his policies. His next area of challenge is foreign policy and the Middle East. Would he still be content with doing nothing and stay behind George Mitchell who claims much of the credit for bringing peace to Northern Ireland but has accomplished nothing in a year in the Middle East (“pragmatism” of past accomplishments), or would he be willing to roll up his sleeves and do the work that the world needs done?