Organized Ontologies ("Waiting for Godot")

Unexpected Inversions and Predictable Trends


Weird, unpredictable, inversions are fully intended consequences providing a level of predictable uncertainty (managed risk) that solicits the need for command-and-control organizational modeling.

A strangely inverted quality immediately presents itself. "Predictable uncertainty" is an oxymoron. The descriptive elements are inverted yet accurately describe the antinomies built into our political economy, rendering it the analytical domain of highly trained elits prepared to make sense of deliberate inscrutibility.

While the reason for, or the cause of, conflicting indicators can be inferred, the causal factors are deliberately black boxed to attain an elitist quality to manage what appear to be unintended consequences, or organizational ontologies.

When the analyst attempts to gauge market sentiment to predict price direction, for example, there is an attempt to turn teleological consequences into a predictable ontology. Strange inversions are then to be explained as unintended consequences--an analytical error to be back tested and regressed into a predictable, algorythmic ontology that reduces to an organizational typology.

From the inside, the inscrutible inversions appear logically consistent with intended strategies within some tolerance of error that produces unintended consequences. Error reduction is the domain of the specialist so that the bonused employee of a too-big-to-fail bank, for example, very narrowly, analytically, applies the derivatives desk without regard to the big-picture, wholistic, consequences, which will appear to be unintended and exculpatory. Both the bonused employee and the employer can disclaim any intention to cause a systemic-risk detriment by applying the self-interest of the firm and cannot, therefore, justifiably suffer punitive damages either legislatively (by means of the tax code) or judicially (by determination of civil or criminal liability). The goal (the telos) of legitmately accumulating wealth and power and keeping it is organizationally applied with highly predictable consequences.

It is critical for risk to be systematically organized to suggest an ontology: so that the legitimacy of the outcome (the cause-effect relatonship) has not been rigged to produce a benefit from an intended detriment.

Financing the declining rate of profit, for example. The decline is a detriment to capital gained in a free market system and a benefit to labor. Reversing the detriment by overleveraging the capital accumulated into a deflationary trend of unemployment cannot be legitimately considered intentional if it is an ontological consequence (the inherent risk) of the system that cannot be transcended. Resisting the natural, ontological tendency toward organized consolidation to hedge the risk, like a declining rate of profit, is considered a fool's task by both the left and the right. Politically, the result is a spectral fusion--a convergence of divergent elements--that is an observable, empirically predictable, historical dialectic, or a predictable, macro-dynamic ontology.

On the left, the dialectic presents a synthesis of the benefit for both capital and labor as the organized convergence of public and private enterprise is formed into a legitimate public benefit, or the general welfare. State capitalism eventually evolves into a purer, more genuine form of legitimacy--state socialism--in which labor is not at all alienated from the value it produces in the form of capital. Competition--the micro-motive (the telos) that causes the systematic-risk ontology of a declining rate of profit--is converged, transformed, into the ontological benefit of full cooperation with the risk having been intentionally, teleologically, organized out of the system.

Remember that if the systematic, competitive-risk ontology is removed, there is less incentive to innovate to control costs or improve quality, performance and efficiency with the profit margin being the measure (the reward) of that success. If capital, industry and markets are allowed to consolidate (converge) to eliminate all the competitive market risk (the alpha risk converted to a mostly beta and gamma risk), the capacity to innovate has already been organizationally diminished. Socialists then, of course, argue that diminshed innovative capacity is a moot argument, as it well is.

The argument for maintaining an organized pluralism in priority over a false organized efficiency of consolidation has both theoretical and demonstrated practical strength. The argument, however, does not advance from the right wing of the political spectrum. It is more an independent, non-partisan argument that favors pragmatism over ideology.

A non-ideological pragmatism is more likely to minimize the probable dystopian results (the unintended consequences?) of hopeful utopian visionaries that invariably tend to fascist, practical models of bureaucratic power (the slogan over the gate at Auschwitz is, for example, "Work Will Set You Free"). Practical reduction to elitist models renders the masses ("We The People") incapable of sovereignty. It becomes a self-fulfilling prophecy of fully intended consequences (an organized ontology that produces stable, predictable, routine tasks).

While the cyclical trend we are experiencing now is described as systemic instability, it is a stable, routine outcome. It has been organized to do exactly what we have by elitist, consolidated control; and while you may not have lost your job this time around, you may in the next cycle.

That a pluralistic market system legitimately determining tastes and preferences (freedom) must be traded off for risk reduction (stability) is a false argument. Reducing the alpha risk (the freedom to choose) encourages investment, and without the trade off, so the argument goes, investment will be sub-optimal.

The efficiency argument is false. Reduction of alpha risk by consolidation of industry and markets does not allow for more risk to be taken, thereby providing the incentive for optimal economic growth, as the argument purports, but less.

The hypothesis contained in the efficiency argument is not only logically inconsistent, but as a basis for public policy it is an empirical failure as well.

Encouraging consolidation of industry and markets through the tax code and regulatory reform in conformity with the hypothesis of ensuring market efficiency resulted in The Great Recession. Not only did slow growth to no growth result in negative growth, but we face the high risk of it several years out, being strangely referred to as "a jobless recovery" (another one of those weird, logical inversions). That the efficiency hypothesis is disconfirmed is the only reasonable conclusion.

While the right wing of the spectrum argues being the champion of free markets maintaining a system of maximizing tastes and preferences, losing your job to a cyclical, supposedly legitimate, ontological trend does little to maximize preference. It maximizes the profit margin without growth (what we have now). The effect is to trade off what a free-market system is to ensure (freedom to choose) for maximizing the profit (i.e., to finance the declining rate of profit inherent to a highly innovative free-market pluralism that wins market share and makes a profit).

The "trick" of the large, modern corporate is to gain market share without "winning" it. Share is gained by capital investment to gain capital without economic growth (remember that growth increases supply and disinflates prices, causing a declining rate of the profit). The resulting, reliably predictable, cyclical trend (recession--deflation--like we have now) gains (wins by organized default) the market share and capital (the recovery--inflation--sure to follow), not by expanding the pie, which is the legitimacy of capital formation (accumulation) for investment, but by contracting (consolidating) it.

We hear pop analysts at this point of the cycle saying, for example, that the reduction of inventory will result in jobs created to replace the supply. No, quite the contrary (inversely), the recovery will be "jobless." It will be inflationary with strangely low interest rates because of joblessness.

Understanding the nature of the inversions is kind of like understanding the concept of gravity. Like Einstein said and Newton suspected, instead of gravity pulling us to the mass of the earth, space is really pushing us into it, and we call the effect gravity. The concept of the model--of the way things work (from a strong, localized attractive force to a more pervasive, universally expansive force)--has changed.

Newton realized his concept of gravity did not quite make sense although the mathematical expression of his physical "laws" had high predictive utility. Even his own descriptive law of motion inverted his hypothesis: objects do not move unless something is pushing them.

In the natural world of political-economy, steeped in telological reasoning, the discrepancy between theory and observation is much more pronounced. The stakes are the telos of gaining wealth and power and keepimg it by means of one's own devices. Extreme complexity is the result with strange inversions of logic to be resolved by a combination of narrative and mathematical modeling much like the natural sciences in which things are only what they appear to be until the empirical evidence is re-cognized with fits of Kantian imagination. The complexity surrounding the mystery of unknown causes and unintended, supposedly unexpected, effects are suddenly rendered simple, predictable, and verifiable by a casual sense of conventional wisdom that is less about what we believe, but what we know as a guide for public policy.

For example, if an economic sector becomes so consolidated in a free marketplace that the consumer has no choice but to do business with it, maximizing the firm's individual, private utility has become the public interest. Application of the firm's self-utility has become a function of public utility much like we have experienced with the financial sector in which firms were allowed to become too big to fail.

There is a direct relationship between the elasticity of the demand curve, the tendency to consolidate into entities too big to fail, and the gamma risk of being considered a public utility. The gamma risk is minimized, rather than maximized, if these markets are not allowed to consolidate. Despite, for example, healthcare providers thinking consolidation of its provision into a government mandate renders an inelastic demand, and therefore an inelastic price, it also increases the gamma risk. The price can be just as easily mandated so that the providers wished it were a free-market economics.

Instead of a direct relationship, free-market economics allows the relationship between demand elasticity and the tendency to consolidate a market to be beneficially inverted for everyone (the more inelastic, the less consolidated). The benefit includes a market's providers whose gamma--if the price can be arbitrated at a non-market value either higher or, maybe, lower--is minimized and the risk of investment (labor or capital) reliably predictable. With the free-market inversion, reduction of the gamma risk then becomes an end in itself which is the pursuit of power (self-determination) and the categorical demonstration (the empirical measure) of success.

Keeping markets unconsolidated spreads the risk. What is lost is the accumulation of power that always verifiably results in crises--a quantifiable gamma risk that presents as inflation, unemployment, and high profit margins, just like what we have now.

There is no "disconnect" between Wall Street and Main Street. The relationship is organized into a detrimental reliance (an inverse relationship) in which one's loss is the other's gain. That is why bailing out the system from the top down was "necessary to prevent economic collapse."

Now that the would-be (unverified) collapse has been averted (and so we will always be bailing out financial "fat cats" first as the successful business model that averts crises), the Fed and Treasury will focus on consolidating and enhancing the profit margin by applying funds to Main Street. Recovery will be the source of funds to both support the profit margin (finance the declining rate of profit) and pay the public debt.

Bailing out Main Street first, allowing financial firms that are "toxic" to fail instead of the intoxicated public-at-large, would have provided the funds the financial sector needed to sober up their troubled assets, declaring bankruptcy protection if necessary, until the benefit trickles up. That prevents a lot of public suffering (a retributive value that measures power and categorizes status into those that sacrifice and suffer and those who accumulate the benefit in the form of that value).

The reason the call was not for Main Street first is because that would have inverted the working, practical means of the Hamiltonian model (the hierarchical "trickle-down" effect that validates who "should be" the elite of power by determining it from the top down rather than confirming it from the bottom up).

The Hamilitonian model of finance from the top down hypothesizes a direct, positive relationship: the more benefit the elite at the top receive, the more benefit "The People" at the bottom receive. Inverting the relationship, supposedly, causes crises, like the financial instability we have recently experienced.

According to Hamiltonians, the crash of 2008 is the result of public-sector programs, government intrusion in the free marketplace, like welfare and social security, that finance (inflate) the system from the bottom up. Therefore, the technical correction for the crisis is to finance the recovery from the top down, and that action was taken with the predictable and fully intended benefit of a jobless recovery.

While Main Streeters bankrupted by the crash of of 2008 are literally left hungry and homeless, Wall Streeters are receiving bonuses. Just exactly where did the bonus value come from? Where in the popular media do you find an accounting that identifies the source of the benefit?

The direct relationship between the cost and the benefit (the more cost, the more benefit) is not clearly identified because it is considered destabilizing (retributive in value). It would empirically challenge the legitimacy (the distributive justice) of the outcome.

Inverting the money flow to finance the recovery from the crash of 2008 from the bottom up would invert the relationship of the cost-to-benefit (the mode, or model, of finance). Financing the recovery from the top down both obfuscates ("a disconnect" as pop media describes it) the direct relationship and validates inversion of the model as a moral hazard.

Validation of the moral hazard is a false empiric: not financing the recovery from the bottom up did not prevent another Great Depression. Recovery from the top down (the jobless recovery) allows firms to succeed that, without bottom-up financing, would be confirmed failures.

Financing from the bottom up provides the distribution required on the accumulation that otherwise presents as a retributive value. An indignant public sentiment about the bonus value, the practice of saving wealthy corporates while letting everyone else fail, and regression of the cost so that the victims are literally paying the perpetrators to victimize them is the political will for converting to a public utility. It empirically represents both the value to be retributed and a genuine moral hazard.

For example, if BIB (Bigger Is Better) Bank forecloses your home and charges usurious overdraft fees after losing your job to The Great Recession, the retributive value is a product of your losses. So you sanction BIB in the marketplace by doing business with SIB (Smaller Is Better) Bank. BIB experiences the alpha risk associated with the retributive value distribution in the marketplace. However, you notice SIB, influenced by the bigness of BIB, is just as usurious, and because smaller banks are progressively more scarce due to The Great Recession, the alpha risk is diminishing.

Rather than being diminished, the retributive value accumulates under the organized, ontological influence of BIB Bank et. al.. The "invisible hand" is a macro ontology falsely argued to be free-market economics, or pluralism, and the outcome is, therefore, legitimate and exculpatory--not worthy of sanction.

Cumulative resistance to the alpha risk also affords resistance to beta risk, but supports the gamma risk, which continues to accumulate, and is "toxic."

What is "toxic" about the troubled assets of The Great Recession is that they have a huge gamma risk associated with them that are retributively valued. Instead of the value being retributed (inverted), the value has been attributed (directed) to the source of the risk and consolidated as a benefit with the source of the benefit holding the risk. Instead of being pluralistically shared, the retributive value accumulates into a gamma risk with firms holding the accumulated benefit inversely facing the accumulated risk of being regulated as a public utility based on that empirical value.

Thus we have, as in the example of BIB and SIB banks, the need for growth. Not to just expand the pie so that the rich can be rich wthout a zero-sum inverse relationship of accumulated value, but to keep the system pluralized. Displeased customers are only likely to do business with BIB or SIB because they have to, not because they want to. A firm can be as greedy, selfish and narcissistic as it wants as long as it pleases the customer.

Economic growth in a free-market environment is less about the impetus to plunder the planet of its resources than to ensure sufficient plurality of the marketplace so that we do business with who we want to (choice) and not who we have to (tyranny). As long as income is sufficiently distributed to demand (alpha risk), rather than command (gamma risk) the bid, the probability for successful innovation to increase supply, rather than to innovate the organized means of creating scarcity and inelasticity of demand in the name of an economy-of-scale efficiency, approaches 100 percent. The profit, and the declining rate of profit, is, then, a measure of who is innovative enough to survive the alpha risk rather than always consolidating to avoid the beta and gamma risks (the extortionist behavior of being too big to fail--the "command" function of the elitist model).

Consolidating industry and markets only avoids the beta and gamma risks, it does not eliminate them. They accumulate in a directly positive relationship: the more consolidated the more potential beta and gamma risk accumulated until the probability of being considered a public utility approaches 100 percent. While the firm's beta is stable throughout consolidation, it becomes highly unstable as its risk-status becomes evermore gamma.

It would be in a firm's best interest to never become too big to fail if it means being a categorical public utility with the firm's self-interest subordinate to the public's interest like, maybe, controlling both inflation and unemployment without inversely trading them off. The only resistance to the clear and convincing, categorically empirical confirmation of a public utility would be the ideology, the belief, that conserving the accumulation of the benefit to the elite and distribution of the cost to the non-elite (what the modern, corporate conglomerate is organized to routinely do) is in the public's best interest. We then have two competing models, elitist and pluralist, competing for an empirical proof that will, by nature, resolve into a nulled hypothesis in which one alternative is so logically absurd (disconfirmed) that the only thing left for practical application is a conceptual model yet to be tested. The change is the next best step by default and it is critical to keep a binary system of choice in place, like a two-party system, to ensure conservation of the stakes is always the next best step in the historical dialectic.

Despite the resistance to pluralism with organizational technologies like a two-party system, there is an empirical ethic at work, a method of continuous improvement that can be deliberately applied or ignored. We can choose to ontologically improve or teleologically retrench. The political will to choose an organized ontology of pluralism will avoid the lengthy and painful process of what nature will ontologically provide as categorical truth always potentially imperative by the freedom to choose.

The morality we do not freely choose nature will technically correct. On the one hand, for example, firms in business to consolidate the marketplace, like private equity firms that buy companies to merge and sell for a capital gain, create a big payoff that is proportionate to the cost (inflation and unemployment). The agents of consolidation, the beneficiaries, however, describe the gain as disproportionate and is reported as an asset with no liability on the balance sheet. The liability (the cost) is latent and categorically imperative. It will empirically present off the balance sheet in the form of a gamma risk that must be constantly managed to retain the value accumulated without bearing the cost, which is what the corporate is organized to do.

Ivy-League economists (the elite of society whose analyses are valued the most) are claiming that their profession has failed to understand how the economy works on a macro scale. (In other words, now that their hypothesis that consolidated industry and markets achieves a macro-efficiency of scale is one huge, glaring empirical failure, the liability is being reduced to a misfeasance and not a malfeasance. In effect, these economists are saying they do not understand economics.... Hmmm...something I've been saying all along.) They claim they have not properly understood how the economy is integrated, or equilibriates; that is, they were not trained or hired to identify or present analyses indicating that consolidation of industry and markets is good for the integrators and bad for everyone else (an inverse, zero-sum relationship instead of the direct, positive relationship they espouse), and where you "know" something, there is culpability that leads to punitive (gamma risk) measures that are more difficult to avoid.

Managing the latent cost (be it deliberately hidden or ignored) without retributing the value is the source for all manner of descriptive and predictive complexity. It produces strangely inverted technical relationships that require the highest expertise to divine (like Tyco Brahe's theory and mathematical model of retrograde motion). The cause is disassociated with the effect so that empirical failure is not failure at all but a natural ontology of unintended consequence that cannot be corrected. The only thing that can be realistically done (what is categorically imperative) is constant management of the empirical effect and all manner of complexity that pluralistically presents as a relative truth that can be neither categorical (identifiable) or imperative (a necessary condition). Empirical truth--the unrecognized but managed cost--is strangely inverted into uncategorical and unimperative. Truth is, then, reduced to the power, the virtue, to impose it. Natural processes are what is left to retribute the value--the cost-to-benefit always conserved.

Global warming, for example, is dismissed by much of the right wing as empirical nonsense because it empirically correlates the cost with the benefit. The hypothesis presents a retributive value that can be categorically acted on with an imperatively empirical measure. It presents a level of certainty (knowlege) that cannot be ignored without clear culpability and consequence.

On the other hand of the political-economic spectrum, ideological, rather than an organizational, opposition to conservatism presents as a spectral fusion. The expected opposition, upon closer inspection, presents a strange inversion with the opposing hands joined to agree on the means to the ends of power--the gamma-risk distribution, which is an end unto itself. The opposition stands to determine who is going to be categorically powerful by imperative.

On the one hand, the gamma-risk distribution is accumulatively managed into cylical distributions that conserves the distribution of power. On the other hand, the gamma risk is accumulatively managed to conserve the distribution of power by managing the effects of cyclical trends in order to eliminate the cause. The alternatives (the thesis and antithesis) are organizationally fused.

In addition to the practice of managing the effects toward eliminating causal factors of accumulated gamma risk being empirical nonsense, conservation of the elitist model suggests the distribution of risk and reward will also be conserved. Who is powerful is defined by a willingness to manage the effects, which tends to conserve the problem the affected seek to cure by popular demand and consent. While an observable evolution of power occurs--from survival of the fittest being legally free of gamma risk to applying that risk by popular consent of the governed--the crisis accumulation of risk is nevertheless conserved.

The accumulation is not necessary and we need not be always "Waiting for Godot" or some ontological change of state that disparages our freedom to choose. The means to ends we are all looking for is well in hand.