Month: March 2021

Blockchain has enormous possibilities as part of the digital infrastructure.  Bitcoin, the most well-known cryptocurrency, is only one application.

I never bought any Bitcoin, even though I saw it as inevitable.  (One of many times I didn’t act on my certainty!)  Bitcoin, Ethereum, and other cryptocurrencies will continue to grow.  If nothing else, there is a deep distrust of sovereign currencies, and a desperate hope of investment returns when most all else is struggling.  Western governments outlawing cryptocurrencies would generate huge backlash.

I think Bitcoin will be significantly limited by the relatively low throughput for processing transactions on a decentralized blockchain.  There is significant and encouraging recent progress in improving speed.  One can forecast see events unfold when it will become very convenient for governments to decry the massive computation costs of blockchain.  I think data centers overall are still consuming ~5% of the world’s electricity supply, and an even higher percentage in some areas.  “These bitcoin miners are exploiting electricity you subsidize, and they aren’t paying their fair share.”

The issue I’ve given the most thought to is a digital currency backed by a government. China has made the first move.  Most Americans are already executing 90%+ of transactions digitally, and it’s even higher in many parts of the world.  Cash is still very useful for criminals.  The global financial house of cards gets shakier, and potentially “resets” – VERY painful – it could be an opportune moment to institute a government backed digital currency.

Digital currency could “solve” multiple problems for a central government:

• A tool against crime and corruptions. All transactions monitored.  All debts known and potentially centrally managed.
• We don’t even need the fiction of “printing” money.  If we need more, we expand it.
• After a time, there is no longer the expense of producing physical bills and coins.
• The overhead of delivering welfare, paying for Medicare expenses, etc. could be much lower than existing “We’ll send you a check.”  The lower expenses would probably offset the value of the “float” that the government enjoys today. UBI would be trivial to implement. 
• Taxation can be optimized.  In principle, a central agency would have sufficient information to tell you what your tax bill is, get a quick confirmation from you, and settle it.
• “Garnish your wages?” “Required to pay alimony or a fine?” Done.
• Restructure outstanding debt via a digital IOU to be delivered on a schedule later.

Here’s the biggest factor: Digital currency is programmable.  “New regulations went into the algorithm the day after Congress approved it.” “Oh, Glenn, you already have more than X in your 401K, so your interest rate will be lower.  Your son’s interest rate will be higher.”  “Your social credit score is low; no UBI for you this month.”  “No one should have more than Y in a private account for retirement because the government is here to help you.  We’re reallocating funds to people who deserve it more than you.”  “The government algorithm has determined that you do not qualify for a loan.”

A massive government can readily persuade the majority to go along.  “You’re already mostly digital now, this is just a final half-step.” “You’ll receive a fair exchange for your existing dollar-monetized savings and assets.” If a digital currency is the only way to get paid by the government, or receive aid, could you object?   If there is only a short window of time to “redeem” bills and coins, then they can enact stiff penalties for anyone using no-longer-legal tender.  I presume the US government and most other governments would come to some new agreement about currency exchange and information sharing – especially on information available about US Citizens’ financial activities in other nations.  Private banking would be forced to adapt.  They would be in the same position as doctors and hospitals in a Medicare world, or Proctor & Gamble in a Walmart world.

Cryptocurrencies get past the “can I trust this?” by using a distributed general ledger; it’s practically impossible to alter it and deceive others.  I don’t think the US government would use a blockchain approach for a digital currency.  They’d use the same capabilities as credit card companies.  They might have fancy language and lofty statements, but it will fundamentally come down to “trust us, we’re your government and we’re here to help you.”

There are definitely upsides to a digital currency. The problem is I see zero-to-few methods for citizens to hold government accountable when money can be programmed.  I see tremendous potential for abuse.  Despite language to the contrary, financial forensics is likely to be even more difficult than it is today.  Designing safeguards will be crucial to establish trust. One of the ways our forebears spoke about the nature of man was this: “King David was a man after God’s heart, but you’d be wise to keep your daughter away from him.” 

What do you think?

Let’s talk civic infrastructure. (I’m limiting my comments to the US situation, even as similar opportunities exist in many countries.)

Imagine you’re on a presidential task force to prioritize infrastructure opportunities which best help business growth, citizen health and opportunity, and strategic advantage.  You get to explore public+private options which also create jobs.   What would be on your list? Which are the highest ROI, most enabling opportunities and could not be accomplished with private-only, bottom-up, local efforts? 

I have a short list:

• Inexpensive, abundant, ubiquitous electricity – with a hardened, robust transmission system
• Retrofitted water, sewer, and water treatment (we lose something like 20% of piped water because of old leaky pipes in some metro areas)
• Repaired roads and bridges
• Ubiquitous broadband for all citizens

So many desirable things become derivative possibilities as these come into effect.  Electricity is simply fundamental.  We need more, and our patchwork grid is long-overdue for an upgrade. Civilization and health depend on sewage treatment and access to clean water.  Not everything can be digital, and good roads and bridges facilitate moving people and physical materials safely. Ubiquitous broadband opens all kinds of business, schooling, and tele-doc opportunities in every physical location. 

All construction jobs are temporary, project based, but these are massive projects in a thousand locations, so the government-facilitated investment would create many excellent jobs for several years.  It’s healthier for government investment to flow through jobs rather than direct payments to unemployed people.

Now, counterpoint to top-down efforts.

I’m long on people but hold short positions on government and bureaucracy.  Here is a test I use:  when politicians and bureaucrats use the word “people” do they like the idea of people, or actual individuals?  Are “people” an abstract means to power and authority?   Also, there are inherent limits to the lasting ability to shape behaviors in positive ways from the top-down because it’s almost always threats and incentivizing on unsustainable dimensions.

There are a few achievements we can only accomplish as big comprehensive efforts.  Everything else of value is best accomplished bottom-up, beginning with the opportunities in our immediate families and neighborhood and community groups.   

My great aunt Martha Gen used to say “What hast thou in thy hand?” when a question came up about how to accomplish something.  She was citing the Exodus story where God empowers Moses to use his staff. 

We can fret anxiously about all the problems in the world.  We can say “Someone should do something about that!” and go back to watching Netflix.  Or we can challenge ourselves to do what we can, where we are, with what we have, together, right now.  Everyone reading this has someone in their sphere of influence who need help that you can provide.  Think and serve locally.  Let love and energy and skill and experience flow through you to individuals and neighbors.  

I recommend two techniques to minimize avoidable failures. (There are factors outside of your control which create risks; these are also useful to devise strategies to mitigate risks you cannot eliminate.)

The first technique is the “pre-mortem.”

 Use your Imagination to think forward in time, asking the question “What are all the reasons this project or plan could fail?”  Test all your assumptions. Check from every perspective. It helps to make this a group exercise because every individual is somewhat blind to risks, or miscalculates.  Use your leadership position to make it safe to surface problems and discuss weaknesses.

Adjust your plans based on what you discover in the pre-mortem.

The second technique is to designate “the devil’s advocate” to intentionally scrutinize and criticize. 

The phrase “the devil’s advocate” has a delightful origin. Centuries ago, the Catholic church leadership realized that the process of canonizing saints had become pure politics, only looking at the good works of candidates.  They established a new practice. The pope appointed a cardinal to act as the “devil’s advocate” to speak about a candidate as the devil would — flaws, faults, etc.

Consider this strategy when you are planning an event, a project, or a change management effort.  Consciously appoint someone as a designated critic to find every flaw or potential problem.  This can work better than an all-group “pre-mortem” because the designated person has been given the assignment to say hard things and point out problems. 

If you’re working alone, then consciously adopt the persona of the devil’s advocate to critique your own plan.  Use both techniques to sharpen your plan, eliminate avoidable failures, and mitigate risks from factors you cannot fully control.

Taking a break for a time to focus on finishing my next book — thanks for your patience.

Perpetual motion machines do not exist. 

Be on guard against a common problem among organization managers:  Belief they can build a perpetual motion machine.  Set up the process, get it going, then expect it will run without any additional energy or oversight.  Friction exists.  Distractions abound.  The value proposition changes over time.

Oh, people intellectually understand that perpetual motion machines don’t exist.  Yet their behavior – and their irritation when a well-started process ground to a halt – tells me that they wanted one anyway.

This is easy to spot in others, and more difficult to spot in your own managerial work. 

It’s best to build a prototype and test before you commit to a sophisticated process.  A good process is well-documented, resourced with primary people and with bench-strength, reproducible.  None of these things is a substitute for energy input.  Someone needs to put in the energy to make the process work. 

That energy might come from a front-line worker who knows the boss is looking for the result.  It might be prompted by a standing meeting agenda to review a monthly report.  You might need to prioritize energy for this process instead of competing opportunities for attention.

Perpetual motion machines do not exist, even for gifted managers. 

Sisyphus was the ruler of Corinth who was condemned to Hades and made to roll a rock up a hill every day, only to helplessly watch it roll down again before he reached the summit.

Some people say their lives are so repetitive and discouraging that it’s like being Sisyphus.

You are not Sisyphus.

I say this confidently because everything difficult, repetitive, even when it fails, changes you.  The real punishment of Sisyphus was that his daily toil never changed him.  He didn’t learn from it.  It didn’t help anyone around him. He was not transformed by the experience.

When people complain their life is a Groundhog Day (referring to the movie) I remind them that the main character was transformed by his experiences.  He did not live precisely the same way each day, and became less selfish with every recycle.

Lean into the hard work, each day.  When God sends us into repetitive experiences it is with purpose to make us better.  When we find ourselves in dark places it is because we’ve been planted in the soil, not buried.  Hear the words Tolkien puts in to the mouth of Aragorn: “There is always hope.”

You are not Sisyphus.