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How To Negotiate The Fiscal CliffDonald Steward11/26/2012

Congress is in gridlock. It is unable to solve the people's problems. Due to technology and globalization the many problems that we might once had been able to solve one at a time have become so intertwined that they have become extremely complex. They are now too complex for us to solve by our wits alone. When Congress can't solve problems, it is only able to engage in fruitless arguments and political power games.

This raises the question as to whether we might be able to use a computer program to help us solve these complex problems. What if we had a computer program that would help people collaborate in developing individually simple aspects of the problem? Then have the computer program connect these dots to allow us to see the larger picture? This may suggest how we might be able to solve these problems.

Unfortunately, no one conceives that this is possible. Therefore, no one has bothered to try to develop such a method, until now! But because no one conceives that this is possible, now no one is prepared to take seriously a computer program that can do this. So we are left to face our serious social problems even while we have an available method that can help us solve them. But no one seems prepared to apply the method to the problems.

The Explainer program helps people with various perspectives collaborate to develop individually simple cause-and-effect statements. Then the program uses logic to connect these dots to reveal the whole picture and its implications.

The Explainer has been used to help find the causes and propose solutions to the economic crisis and widening wealth gap problem. This problem required working with over 30 aspects of the problem and almost 20 levels of logical reasoning. This is far beyond the capacity of our wits alone. We need the help of a computer.

We are now confronted by the looming fiscal crisis problem with little grasp of how we might solve it. It is being dealt with by warring factions that are unable to get past their political power games to bring reason to solving the problem.

This gave me the opportunity to see if the Explainer might bring some reason to the financial cliff problem. As a consequence of this analysis, I have been able to trace difficulties inhibiting the negotiation back to some faults in assumptions that need to be confronted before the problem can be solved.

Using the Explainer program to trace through chains of cause-and-effect reasoning has led back to the fundamental causes that explain the situation so that it can now be understood and ways proposed for solving the problem. These proposals sound reasonable and may deserve further consideration.

There are two assumptions that must be resolved before the fiscal cliff problem can be solved. The Explainer shows that these two assumptions are as follows: One is the assumption that providing more wealth to those who are already wealthy will produce more jobs. But examination of that assumption shows that it is wrong.

An economist, Leonard Burman, who teaches economics at Syracuse University’s Maxwell School found no correlation between high taxes on the wealthy and joblessness. He has offered his data to other economist to challenge his conclusions. No one has successfully found any fault in it. The Congressional Research Service prepared a report with the same conclusion. But politicians saw that the report was not published. There have been periods in the past when taxes on the wealthiest have been much higher and regulations more strict, yet joblessness was not a problem. When taxes on the wealthy were higher from the 50’s to the 90’s, unemployment was lower and both the wealthy and the rest of us were much better off.

Two is the assumption that a faster payoff of the debt would be beneficial to those in the future who will be confronted with paying off that debt. But a faster payoff of the debt also comes at a sacrifice to current expenditures on education, infrastructure, and research that would give those in the future the capability to pay off that debt. Thus, there are two countervailing forces that need to be considered and balanced.

After using the Explainer to do this analysis, the conclusions that arise from the analysis appear obvious. Perhaps they would have been obvious before the analysis. But before the analysis, there were many conclusions that were also obvious. The difficulty is that most of those conclusions that were obvious happen to be wrong. They would not hold up to the facts and their logical consequences s, which is the basis of reality. An analysis such as was done with the Explainer also reveals which of the things that are obvious one should focus on.

This suggests that the best approach may be to reduce the debt as quickly as possible while still preserving our investments in future prosperity. This might lead to a better focus in the coming negotiations where disagreement is caused by an assumption that is being made that is not true. Confronting this assumption could well lead to solving the problem.

A corollary to this problem is that with the rising cost of education and the greater dependence of good employment on advanced education, the wealth gap will increase because only the wealthy will be able to educate their children for the jobs of the future. This suggests that we should investigate the cause of rising educational costs. Confronting this problem involves considering why governments are no longer supporting the cost of education to the extent they once did. And this problem is intertwined with problems such as the lost general prosperity of the majority of taxpayers and the unwillingness of those who could pick up the slack to do so. This is another problem that the Explainer might help us deal with.

Attached is the cause-and-effects we used. The following shows the chains of cause-and-effects used to explain ‘FUTURE PROSPERITY’ in terms of the assumptions that are either true, false, or irrelevant. Assumptions are statements of effects that have no given causes.

Assumption: ‘FEAR THAT CONGRESS WILL NOT WORK TOGETHER TO RESOLVE CLIFF’

Assumption: ‘AUTOMATION’

Assumption: ‘BELIEF THAT INCREASE IN WEALTH AT TOP WILL CREATE JOBS’

Assumption: ‘SEVERE DEFICIT REDUCTION’

This analysis, which would be done by the Explainer program but is simple enough in this case to explain here, would go as follows:

Assumption:

  • FEAR THAT CONGRESS WILL NOT WORK TOGETHER TO RESOLVE CLIFF
  • AUTOMATION
  • BELIEF THAT INCREASE IN WEALTH AT TOP WILL CREATE JOBS
  • SEVERE DEFICIT REDUCTION

By eliminating the intermediate effects, we get the matter to be explained stated directly in terms of the assumptions.

‘FUTURE PROSPERITY’ is caused by:

  • ‘SEVERE DEFICIT REDUCTION’ by the mechanism of reducing the burden on the future to pay off the deficit
  • AND NOT ‘SEVERE DEFICIT REDUCTION’ by the mechanism of making money available for education, infrastructure and research rather than debt reduction to make it easier for future to pay off deficit.
  • AND NOT ‘BELIEF THAT INCREASE IN WEALTH AT TOP WILL CREATE JOBS’ by the mechanism that this belief will inhibit higher taxes on the wealthy

As above, research has shown us that we should not believe that an increase in wealth at the top will create jobs. So that takes care of one assumption; it is wrong.

Then we have to balance between making a severe decrease in the deficit now to lower the burden of the deficit in the future, and on the other hand slowing the decrease in the rate we pay off the deficit so we can pay now for education, infrastructure and research that would contribute to prosperity in the future that would make it easier to pay off the deficit. This clearly shows us the various sides of the balance in the rate of decreasing the deficit that we must consider. Once a decision is reached on this point, the rest follows.

It is not a trivial exercise to develop the cause-and-effect statements. It takes a lot of trial and error. Try something and see how it works. Look at a scenario that shows how the Explainer reached its conclusions. See what is wrong and correct some of the cause-and-effect statements. Then finally you reach a set of cause-and-effect statements that talks to you, and comes to conclusions that after the fact seem to make sense. It’s not easy, but well worth the effort.

This should make it easier to start a fruitful negotiation process.

The Explainer method is a fundamental problem solving method that can be used to solve many types of problems, social and otherwise.

It could be extremely valuable if Congress were to use this method to solve the people’s problems.

The previous is an example of the application of the Explainer to a practical problem. It explicitly shows the stringing of cause-and-effects in sufficient detail to get a sense of how the Explainer method works.

If you could pass this on to others so they can contact their congressperson and senators, it might help us resolve the fiscal cliff with minimum damage.

Thank you.

 

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