“I believe we are condemned, if you like, to live at just one of those moments in history when the gimbals upon which the established orders of power is beginning to change and the new look of the world, the new powers that exist in the world, are beginning to take form. These are nearly always highly turbulent times.”

As Americans, we face a highly multipolar world. We feel the decline of U.S. exceptionalism and the attendant existential crisis of this realization; the ongoing global financial malaise and the emerging debt crisis threatening to break apart the European Union; the rise of China as a dominant world power and the implicit criticism of democracy that comes from its economic success; and the evolution of Islam as an explicit criticism of western prosperity. We are realizing the massive power of finance & energy cartels while struggling with ultraviolent drug cartels. We feel the impacts of domestic unemployment amidst weekly reports of record corporate profits. Capital is moving away from mature western markets for the young labor pools of the developing world. Fund managers are betting more on decline than investing in growth. There is a growing sense that western governance is failing in its charter to effectively manage the prosperity & security of its citizenry, and that selfishness, partisanship, and corruption have undermined the political process.

In the United States there is arguably a crisis of confidence in governance. We face extreme partisanship among policy makers and their apparent inability to effectively govern on domestic issues. Congress has a 20% approval rating. 73% of Americans believe the country is moving in the wrong direction. On domestic issues, the popular narrative of U.S. governance is one of bickering, incompetence, and failure.

So if there is a crisis of confidence, is there an actual crisis in governance? Recently the debt Supercommittee failed to agree on a solution for the deficit. This past July, the largely-manufactured budgetary impasse shook confidence in U.S. governance contributing directly to the S&P downgrade of our hallowed AAA credit rating. To quote the S&P report, the downgrade “reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges”. Even closer to home, the American Society of Civil Engineers recently reviewed U.S. infrastructure with a grade of “D” stating that it would take $2.2 trillion over the next 5 years to bring our roads, bridges, railways, water and energy systems, and waste treatment capacity up to 1st world standards. These are the fundamental needs required to keep a country functional & efficient.

Looking at recent statistics, the U.S. Commerce Department charts wages & salaries at only 44% of GDP – the lowest since 1929. Corporate profits, on the other hand, now contribute 10% of GDP – the highest on record since that auspicious year, 1929. The U.S. Bureau of Labor Statistics estimates unemployment at 9% though real measures of unemployment that include the under-employed and those who have given up looking for work are estimated closer to 16%. Among young adults age 16-24, 50% are without work – the highest number on record since 1948. The majority of unemployed no longer receive state benefits. Tens of thousands of service members are returning to joblessness & homelessness. The 2010 U.S. Census Bureau estimates that 46 million people are living in poverty – 15% of the nation. This number has been increasing annually for the past 3 years. These trends are undermining the legitimacy of the US government both at home and abroad, and contributing to the social unrest sensationally illustrated by the rise of both the Tea Party and Occupy Wall Street movements.

Typically, when we observe these statistical trends in other countries we see a growing segment of the populace more exposed to gang indoctrination, co-option by religious fundamentalism, and coercion by home-brewed militias. This unfortunate reality is not lost on policy makers, as telegraphed most recently by Congressional attempts to reconfigure the legislative landscape of the Homeland as a domestic battleground.

While national statistics are indeed worrisome, the situation at the local & regional level is more varied and offers some hope. There is a shift towards state’s rights as illustrated by the more libertarian aspects of the Tea Party and the GOP narrative against so-called big government, but also in many state legislatures on both sides of the aisle. While often ideologically driven, this shift towards state governance is a response to the limitations of central management across such a large and complex territory as the United States. Perhaps more interestingly, we see a shift to municipal power as urban populations swell and major cities take ownership of their roles as economic engines. Mayors are gathering more influence over state and federal policy, and are making more lucrative partnerships with global allies.

Yet, there are huge budgetary challenges for both states and municipalities, with states often pushing their own budgetary problems down to the county & city level. There is even talk of an emerging municipal debt bubble as cities issue more bond debt to cover their existing debt costs. The U.S. just witnessed the largest municipal bankruptcy in history when Jefferson County, Alabama, failed to cover its sewage bonds. This is the downward cycle of U.S. infrastructure & budgetary mis-management laid bare.

The picture of local and regional governance is a patchwork of attempts (successes and failures) to address the many challenges confronting us locally and handed down from state and federal institutions. As higher-order governors lose legitimacy, states & regions will work to sidestep their authority and to innovate around budgetary shortfalls and non-local obstacles. Progressive states agitate for marijuana legalization and same-sex marriage, conservative states assail big government and immigration, southwestern border states are dealing with the spill-over from Mexico’s narcowar, and many regions across the country are absorbing diverse and extreme climate impacts potentially driving food production, water supplies, and population movements. So while large, productive cities are generally seeing more cohesion there is a significant risk of increased balkanization across regions and states.

U.S. governance is clearly challenged on many domestic fronts. In operational terms, we’re falling short. Governing institutions are too big and too slow to respond to such accelerated change. If we’re failing to manage the present, how can we prepare for the future? There is too much complexity to effectively predict change and yet there’s too much institutional friction to adequately invest in broad resilience. This combination poses tremendous risks to domestic security. The snapshot of social unrest in America arises from two primary drivers: the fear of U.S. decline and the sense that Democracy is no longer working (represented by the Tea Party and OWS movements, respectively). Both are rooted in a lack of jobs, diminishing access to prosperity, and growing insecurity in the face of poorly managed discontinuities. When government fails to meet it’s charter, it loses legitimacy. When conventional channels for change are closed, the gap widens between governors and the governed.

For better and for worse, a lot of innovation happens in the gaps. There is innovation in governance itself, as in the Gov 2.0 & OpenGov initiatives to standardize operational data across organizations, to publicize the data, and to invite the public to work with the data and develop 3rp party applications. Deputizing the crowd to help with governance can offer tremendous opportunities for innovation, as exemplified by tools such as Oakland Crimespotting and the Everyblock platform. The citizenry is becoming more digital and addressable with direct polling, crowdsourcing, and experiments in electronic voting. Transparency initiatives, such as the Sunlight Foundation, build web platforms to track and reveal the influence of money in politics. The growth in mobile/social/location platforms empowers tremendous opportunities in civic innovation, as does the emergence of embedded instrumentation in the built environment. Tech collectives and hacker spaces, experiments in local and digital currencies, slow food and Buy Local movements, increased community volunteerism and more public-private partnerships – all of these examples build local resilience and enable communities to take care of themselves.

Many of these efforts follow open source models that enable fast innovation and iteration across diverse non-local nodes, avoiding hierarchies and direct leadership in favor of feedback loops and emergent self-governance. These models gained popularity with the open source software movement but have since expanded to include innovation in open hardware and fabrication, science and robotics, economics (there is an estimated $10 trillion informal economy growing in the gaps globally), and political movements. Open source templates have enabled new models of power such as Occupy Wall Street and Anonymous, many aspects of the Iraqi insurgency, and the dangerous ecosystem of adaptation and innovation found in the IED marketplaces of Iraq and Afghanistan. The ability to maintain such open source models of organization has been radically empowered by mobile telephony, SMS, and social media. The ability to globally broadcast, communicate and collaborate has enabled a new breed of citizen reporting pushed out through platforms like You Tube and Twitter. Rapid SMS communication across mobile devices enables fast stigmergic coordination that can mobilize people en masses with a moment’s notice. The Green Revolution in Tehran, the Arab Spring, and the periodic support calls sent out by OWS groups are all examples of how borderless, frictionless hyper-connectivity empowers a patchwork of active tribes, locally and virtually.

Gaps in governance empower innovators and competitors alike. Actors exploit the gaps and seek to influence or undermine governance in order to open more gaps. Super-empowered individuals like Bill Gates and Eric Schmidt work to influence conventional channels of policy-making while restructuring the regulatory landscape to better enable their businesses. Activist billionaires like Warren Buffet, George Soros, and Sir Richard Branson use their weight and influence to change world affairs, as do libertarians like Peter Thiel and anarcho-capitalists like the Koch brothers. Some super-empowered actors are feral and may not appear to be powerful yet manage to inflict exceptional discontinuities on their targets. Arms dealer, Victor Bout, has been a significant driver of unrest in Africa. The head of the Sinaloan cartel, Joaquin Guzman, has helped deconstruct Mexican governance into a lawless war zone. Henry Okah, the leader of MEND in Nigeria, used a small group of lo-tech saboteurs to target critical pipeline infrastructure reducing crude output by 50% and costing western oil interests billions in production revenue. Cartels and criminal networks operate on international scales moving billions of dollars to influence authorities and outwit enforcers. Tech-enabled sociopolitical collectives like Anonymous and Wikileaks deputize themselves as moral enforcers, exposing secret agendas and arbitrating punishment. These actors walk the same stage as multinational corporations and NGO’s that have no built-in allegiance to the United States or, in some cases, to democracy itself. All of these actors exert their will on the world by building influence and exploiting the gaps. All of them are empowered by hyper-connectivity and cheap computation to coordinate, collaborate, and influence at all scales.

This is an age of hypermedia and hyper-politics. There are almost 3 billion internet users, globally. There are over 5 billion mobile subscribers – this is 77% percent of humanity. Last year, in 2010, over 6.9 trillion text messages were sent & received. Humanity has global, instantaneous communication; immediate amplification of emotion, ideology, witnessing, discovery, innovation, and iteration. We are sharing what works and what doesn’t in all domains and endeavors. Everyone is being lifted by this rising technological tide. Small-scale power is amplifying exponentially through ubiquitous computation and mobile communication. Power is re-distributing across the globalized, hyper-connected landscape in such a way that a small, minimally-funded group can generate exponential disruptions. In a mediated world, we see a new war of narratives competing for mindshare across hypermedia, cultivating borderless affinities and ideologies, and offering a global voice to disenfranchised and exploited groups. Top-down governance, unable to extend control so far over such large-scale discontinuities, is yielding space to flattened hierarchies and self-governance. All institutions are being forced to evolve and adapt to this new landscape, as all efforts to suppress it will inevitably fail and only drive more turbulence.

Complexity is an expression of information, and hypermedia is a complexity feedback loop of revealing, sharing, and iterating. Hypermedia, in all it’s varied forms, is injecting unprecedented amounts of information into our awareness. This widening perception of complexity drives behavioral uncertainty as people and institutions feel increasingly overwhelmed and lost in the noise. The world wide web has driven massive discontinuities into almost every business model, organization, and political objective. Mobile telephony coupled to social networks has given voice to the real-time status of the majority of people on the planet. In this maelstrom of asymmetrical disruption, chaos appears to be the new norm though this will likely reveal itself to be the turmoil attending a broad shift towards a new order of stability.

Complex systems across many scales have moved into a late conservation phase and are beginning to release their organizational capacity. Legacy institutions have grown far too optimized and narrow to absorb the turbulence unleashed by globalization, ubicomp, and mobile telephony. Systems have destabilized in order to make the phase change into whatever next basin of stability awaits. Governance is necessarily challenged and states will inevitably give some degree of power & influence as capital flows out of the West; as more empowered actors take the global stage; as non-local relationships shift affiliation and allegiance; as borders are antiquated by the internet and the cell phone; and as over-extended unions fracture and balkanize. Centralized control structures are not adequate to manage such large scales of nested and inter-dependent complex adaptive systems. But fortunately, the same drivers that have introduced so much discontinuity and have challenged governance as we know it are helping construct the new forms of distributed, participatory governance. Hyper-connectivity, hyper-visibility, and hyper-empowerment are driving a global peer review of legacy institutions in a patchwork attempt to define Civilization 2.0. The process is turbulent and the future is cloudy but we’ll likely land on solid ground eventually.

[This paper was originally published for a government report on discontinuity & change management.]

I’ve just returned from a very interesting workshop in Washington, D.C. about fast-moving change, asymmetric threats to security, and finding signals within the wall of noise thrown up by big data. These are tremendous challenges to governance, policy makers, and the intelligence community. I’ll have more to say on these topics in later posts but for now, here’s a round-up of the most popular posts on URBEINGRECORDED in order of popularity:

Occupy Wall Street – New Maps for Shifting Terrain – On OWS, gaps in governance, empowered actors, and opportunities in the shifting sands…

Getting to Know Your Ghost in the Machine – On the convergence of ubiquitous computation (ubicomp), augmented reality, and network identity…

The Transhuman Gap – On the challenges facing the transhuman movement…

The Realities of Coal in the Second Industrial Revolution – On the energy demand and resource availability for the developing world…

Meshnets, Freedom Phones, and the People’s Revolution – On the Arab Spring, hyperconnectivity, and ad hoc wireless networks…

And a few that I really like:

Back-casting from 2043 – On possible futures, design fictions, and discontinuity…

On Human Networks & Living Biosystems – On the natural patterns driving technology & human systems…

Outliers & Complexity – On non-linearity, outliers, and the challenges of using the past to anticipate the future…

Thanks to all my readers for taking the time to think about my various rantings & pre-occupations. As always, your time, your participation, and your sharing is greatly appreciated!

I was driving through the Tenderloin the other night – one of the most socio-economically depressed areas of San Francisco. Across a long wall someone tagged “Occupy Wall Street” in big letters with a clean font and preceded by the Twitter “#” hashtag notation. It was a big, funky chorus bridging the grimy street with a shimmering virtuality beckoning from the other side. A shiny enticement to both residents and passers-by, yet it instilled in me that there are some hard reasons why Occupy is still a bit pale, demographically. The Tenderloin is where people fall to the bottom of the American heap, struggling every day just to try and get by. I can’t speak to their cellphone use but I’m guessing most aren’t on Twitter.

In America, poverty & homelessness are specters stalking the nightmares of the middle class. The stigma is crushing and many studies show how hard it is to fall out of society and fail normative expectations, forced to walk as a ghost the rest of us don’t want to acknowledge. We’re all “temporarily embarrassed millionaires”, to quote Steinbeck, but most are scared to death we’ll wake up from the American Dream wearing dirty rags and begging for pittance.

Amidst the looming failure of governance and the siphoning of capital into the hands of elite gamers the system starts to reveal interesting and exploitable gaps. The gaps opening up between the ruling elite, the body politik, the business world, the towers of old-world power, global supply chains and international demand structures, and the organic messiness of the street lashing together its own ad hoc infrastructure, battening down against the hard approach of a faceless Winter. A lot of innovation happens in the gaps.

When a control system releases it’s organizational capacity, the system tends towards a period of turbulence. Turbulence can be thought of as a widening of constraints on energized systems, ie things start getting wonky & unusual. Institutions are challenged. Stability & confidence are shaken. Calcified bureaucracy cedes power to fast, open-source iterations. Hierarchies flatten, though riddled with super-empowered outliers, revealing design patterns more akin to fuzzy biology than the mechanized Taylorism of the Industrial Age. A mycelial hypermedia of distributed, tech-enabled, self-empowered collectives emerges. The landscape is shifting so quickly that even the rules of the game are being forced to adapt. And not in any particularly easy way, mind.

The United States government is failing to adapt or effectively shepherd its populace into the 21st century. Many western nations share a similar sentiment. They’re falling left & right to the slipperiness of the behavioral economy and to top-tier predators drawing capital out of weakened states and widening the gaps between people & power. Meanwhile, gangs & cartels and urban collectives (oh, and the estimated $10T – trillion! – informal economy) are all pulling the weave apart further and staking their territorial claims. The landscape is ragged and hungry and a bit unhinged. Many of us are growing nervous feeling the hot breath of the meathook future on the back of our necks.

“You will not hear me, you will not listen to me, so I will stand in your face and you will be forced to see me.”

Occupy Wall Street is an expression of this sweaty fear & creeping nihilism in a world that looks decidedly different than the one we were raised to expect. It’s an empowered disenfranchisement: the realization and acceptance that the American people no longer have a say in the conversation about our country. “You will not hear me, you will not listen to me, so I will stand in your face and you will be forced to see me.” This is what Occupy says. And it says it encamped in front of your hallowed institutions, deploying local food & health services, brewing ad hoc energy supplies, coordinating collective actions, surveilling the local PD and running mobile counter-ops, holding signs to the media cameras and managing international PR campaigns. This is a new model of power emerging across technologically-savvy collectives, economically detached on the ground but coordinated with well-healed and influential sympathizers among the extended technorati. You get amplification, charitable donations, shout-outs, drop-ins from mayoral candidates, and as-needed mobilization of supporters who still have to hold down their day jobs and take the kids to school. Of course, the PD knows all this & knows how to exploit mobile social media as well.

The Short Message Service (SMS) was implemented in 1992 and is now ubiquitous and coupled to an insanely sophisticated global supply chain. A large driver for cellphone adoption, these discrete packets of information passed almost immediately across non-local nodes have proven extremely powerful. With very lightweight protocols and minimal hardware demands, SMS is fast becoming one of our primary signalling pathways. Witness the simple observation that mobile-enabled teens are constantly texting, rarely speak on the phone, and disregard email almost entirely. More info, less work. Now make sure every one of the somewhat feral and vaguely radical protestors occupying the park across from your ridiculously powerful and possibly sociopathic local tax base, eg The Federal Reserve… make sure they all have SMS mobiles. And make sure all the other urban clans have them too so they can share updates & anticipation, coordinate a distributed response, propagate the sticky phrases and hashtags, and rapidly pass counter intelligence to every single global node. Oh, and there’s this thing called Twitter that will take your SMS and push it out to a broadcast subscriber list that’s being crawled by every journalist, intel org, and revolutionary sympathizer across the modern world.

Of course the NYPD is scared and twitchy. Of course the DHS is yelling at all jurisdictions to get this under control. The true sign of fear will be revealed if they send in the National Guard – a tacit admission that the police are more sympathetic to the protesters than the economic cartels. And if you wanna get really meathook, peep the vid of the armed, self-appointed border guards standing against the Arizona Police Department to defend Occupy. “Using our 2nd amendment rights to defend our 1st amendment rights” was the money quote from that one.

Pundits and old-century analysts can’t get past its slipperiness. It doesn’t look like how protests were supposed to look. It won’t fit into a neat soundbite or flashy statement of demands. This gets really annoying for a mainstream press corps empowered by semantic containment.

Occupy Wall Street is an exceptional sociocultural hack. Grabbing eyes & hearts, they’re making it OK to protest again in America. After 911 the normative pressure around dissent & protest shifted, making it very un-American to disagree with and or show criticism of The U S of A. Occupy is quickly becoming view-fodder for the mainstream media. Spin it any way you like but OWS is grabbing the spotlight globally. Expect the election cycle to raise it as a common talking point – a good reason Occupy can safely find heat indoors for the Winter, come back swinging in Spring. This normative shift allows the many many folks who aren’t yet willing or simply can’t come sleep in the streets to be active & connected sympathizers helping spread the word, defend the narrative, and get downtown at 2am on a Thursday to stand against an expected police action. Social media invites participation at all scales.

People talk of so-called “new models of work”. Remote specialists coming together around a shared task, doing the work with a minimum of resources, taking value, and collaborating with adjacent like-minded ad hoc clusters. All enabled by information technologies and responding to shifting economic realities. BTW, capital is leaving the West and moving eastward and into Africa. Brazil is doing OK as well, I hear. But these new models of work are the same 21st century design patterns iterated on by Anonymous, WikiLeaks, and the Mexican cartels (with varying degrees of flamboyant and or enigmatic leadership). Another eye-opening newsblip from the past week is word that Anonymous is going after Los Zetas cartel (or possibly not). Thing about the Zetas… they don’t just hang out in cyberspace. You don’t wanna be trolled by Zetas.

So yeah, DHS is nervous. They see all these small fires and worry that one will flame up into a real conflict, or that their ranks will be taken over by legitimate militants/gangs/cartels/etc… Meanwhile, China is quietly laughing at us, gently suggesting to the world that maybe Democracy isn’t really all that necessary for a decent house, a reliable job, and good prospects for your kids. It’s worth considering what this means for U.S. diplomacy and the project of Democracy.

The sympathy that boomers have with OWS is rooted in this emigration of prosperity away from our shores. They did fine, my generation is fighting to hang on, and the younger generation can’t get a job. Of course, the Boomers think OWS should be using the tried-and-true models of the 1960′s, not this crazy post-modern artwar stuff. But they lived in a very different world and, ironically, it’s the protest movement of the 60′s that hardened the economic jungle and trained it against the Left.

The front of the emerging cultural war is everywhere & nowhere.

Occupy is a new creature bred to adapt to a markedly different environment. It uses similar design patterns from Tahrir Square and Tehran. It’s the new hyperpolitics enabling virtualized ideologies & coordinated actions by distributed collectives. Like everything else being spread across the real & virtual, the front of the emerging cultural war is everywhere & nowhere. The focus now is on prosperity and equality but it’s tugging at the sweater threads of our entire industrialized economy, already well-frayed & tattered from the wear & tear of the new millenium. Occupy is a statement about failure & fear and a realization that the people who have been entrusted to keep it all together for us are no longer acting on our behalf.

It’s a scary place to find yourself, falling into the gaps. But there’s tremendous potential there as well. And it’s likely a manifestation of far deeper and longer evolutionary imperatives brought to bear on the aging and deprecated foundations of industrial civilization. We are due for a major upgrade. New features & workflows are direly needed, and please patch some of those nasty bugs we’ve been complaining about for centuries. It would be really nice if we could all get back to work helping the world get a little better, day by day.

[This article was picked up by Business Insider.]

Two risks are especially significant given their high degrees of impact and interconnectedness. Economic disparity and global governance failures both influence the evolution of many other global risks and inhibit our capacity to respond effectively to them.

In this way, the global risk context in 2011 is defined by a 21st century paradox: as the world grows together, it is also growing apart.

It is worth noting how inter-related these two megatrends are as wealth consolidation into an elite class enables them to further deconstruct global governance mechanisms. This has been a feedback loop for at least the past 40 years, if not longer, as western growth fueled the rise of non-state economic bodies & super-empowered individuals who then lobbied against regulatory measures that would aim to keep their rise in check and mitigate the risk of disparity. Elites consolidate more money & power, further driving disparity and eroding governance. What results is an interstitial vacuum where corporate intervention fails to see any profit motive and where state intervention lacks the funds or will to govern effectively.

In effect, the combination of super-empowered non-state actors, failures of state governance, and widespread economic disparity undermines the Rule of Law by releasing elites from accountability and driving the underclass deeper into criminality.

Within these megatrends they cite three important risk factors:

The “macroeconomic imbalances” nexus: A cluster of economic risks including macroeconomic imbalances and currency volatility, fiscal crises and asset price collapse arise from the tension between the increasing wealth and influence of emerging economies and high levels of debt in advanced economies.

The “illegal economy” nexus: This nexus examines a cluster of risks including state fragility, illicit trade, organized crime and corruption. A networked world, governance failures and economic disparity create opportunities for such illegal activities to flourish. In 2009, the value of illicit trade around the globe was estimated at US $1.3 trillion and growing. These risks, while creating huge costs for legitimate economic activities, also weaken states, threatening development opportunities, undermining the rule of law and keeping countries trapped in cycles of poverty and instability.

The “water-food-energy” nexus: A rapidly rising global population and growing prosperity are putting unsustainable pressures on resources. Demand for water, food and energy is expected to rise by 30-50% in the next two decades, while economic disparities incentivize short-term responses in production and consumption that undermine long-term sustainability.

These risk factors are certainly of concern but it’s worth looking at how they represent symptoms of an underlying current. Macroeconomic imbalances & illegal economies are two sides of the same coin, both indicating that the fundamental truths of economics are no longer applicable to the current global system. The territory has shifted but the map has yet to be effectively updated. The legacy code of macroeconomics is far too simplistic to contain the realities of the modern globalized marketplace.

Furthermore, undue faith in free markets has blinded the regulatory eye to the simple fact that markets have been thoroughly gamed by a small class of particularly savvy players. Markets are in no way free and it’s a fine trick of the big players to turn blame towards state regulation rather than admitting their own aggressive influence. The light being shown on Rupert Murdoch’s empire during the News of the World scandal is a prime example of this posturing. Murdoch has used his media empire to champion the free market mythology and to challenge state governance while shrewdly re-drawing the regulatory and tax laws to suit the needs of his own business.

Thus, the rise of the illegal economy is both a necessary alternative to a broken formal economy thoroughly gamed by elites, and a perverse imitation of the seemingly above-the-law attitudes of those very same elites who are in many ways idolized by the downtrodden.

Similarly, but perhaps more fundamentally, the water-food-energy nexus arises as a consequence of the growth models so canonical to historic economics. These models arose before there was a nuanced understanding of finite natural systems. Growth was eternal and all economic success has been measured against metrics of expansion. Extract more oil, mine more resources, build more cities, sell more gizmos, hire more people, expand into new markets. But again, the map was too simple to really reflect the territory. Resources are finite. The planetary system is ultimately closed and you can’t send waste away and import new resources (at least not yet or any time soon).

The common picture that emerges is that our models for how civilization interacts with the physical world, and the governors that have emerged over millenia to keep the global system in relative stability, are out-dated and losing relevancy. The system is moving into a phase change and will shed many legacy governors and force the maps to be re-drawn. This is, arguably, where we stand today amidst the obvious turmoil of our world – a world that is being completely revolutionized by globalization, ubiquitous computing, and asymptotic population growth.

Across this landscape arise five risks to watch:

Cyber-security issues ranging from the growing prevalence of cyber theft to the little-understood possibility of all-out cyber warfare

Demographic challenges adding to fiscal pressures in advanced economies and creating severe risks to social stability in emerging economies

Resource security issues causing extreme volatility and sustained increases over the long run in energy and commodity prices, if supply is no longer able to keep up with demand

Retrenchment from globalization through populist responses to economic disparities, if emerging economies do not take up a leadership role

Weapons of mass destruction, especially the possibility of renewed nuclear proliferation between states

These are the more pragmatic and addressable drivers forming the new governing mechanisms. They will draw towards them the coordinated efforts of many interests. Grappling with these emergent threats will build the structures necessary to contain them effectively. However, the traditional reliance on state governance to overcome these challenges looks increasingly unreliable, and it remains unclear whether corporate solutions will offer trustworthy substitutes. More likely, responsibility will fall on local efforts, distributed collectives, community governance, and investment and championship by benevolent economic elites. This perspective offers another view of the WEF2011 paradox, “as the world grows together, it is also growing apart”.

Of note, the solution space is much greater than in the past. The upside of population growth and the rise of the developing world is that the resource pool for creative innovation in the face of these risks is now larger than ever. Likewise, the tools for knowledge gathering and collaboration are readily available to most of the world and offer incredible power, capacity, and scalabilty. The phase change will continue to be full of turbulence but the sandbox for innovation is huge and the timeframes for iteration are tiny.

From another WEF article published after the Japanes tsunami crisis, titled Lessons for Living in a New World of Risk:

Thus a global network that shares best practices, promotes lessons learned in one part of the world for application in another, and assists its members both to better prepare before an event and better respond after can be of enormous value. By establishing direct channels of communication to government leaders, risk experts from some of the world’s leading companies, academic institutions, NGOs and other parts of society can provide valuable assistance in times of crisis.

Increasingly, we live in a world defined by flat networks. Folks like Clay Shirky, Ben Hammersley, and others have observed in great detail how the design patterns of the internet are challenging and changing the landscape of human civilization. So many of our institutions have been built as hierarchical pyramids designed to exert the maximum degree of control over their domains. These top-down management structures have come to define business, government, the military, medicine, education, the family, and knowledge itself. Leaders rise to the top as centralized governors dictating down the chain how things should be, while workers march in step towards execution of their appointed tasks. Such structures were modeled after the clockworks & steam engines of classical mechanics, designed to be precise, rigid, and durable, capable of lasting hundreds of years. These structures informed the defining metaphors of our entire industrialized society.

Computer architecture recapitulated the mechanical metaphor by designating a central processor that assigned & managed tasks bussed out to sub-processors and specialized functional components. In this way the computer became more of a powerful extension of the industrial age rather than a stake in the ground of a new paradigm. While the mechanical metaphor gradually evolved into the computational metaphor which has defined the last two decades, it wasn’t until computers began to follow the model of telecom and began connecting with each other across flat networks that the seed of a biological metaphor began to take hold.

Nature, it seems, does not create very many rigid, top-down control systems. Those are too stiff and inflexible for the dynamics of life. Rather, nature evolves vast horizontal networks that assemble into specialized functions within their environment. For example, the messiest, most distributed organizational structure known – the human brain – does not have a top-tier manager or CPU. There is no executive function within the brain or its mind, though we typically like to think there is. Instead, the brain is a vast & mostly flat hierarchy that is bundled into loosely vertical functional bodies. These functional bodies are themselves existing across a mostly flat horizontal network of interactions. The thalamus receives all inputs and routes them up to higher cortical processing and lower hindbrain autonomic structures, into the amygdala for emotional content and across the hippocampus for memory, then down throughout the body. The processing chain is massively parallel, interconnected, and marked by complex feedback pathways. Mind arises off of these processes in a very ad hoc manner, always shifting, always flexible, and always derived from a mass summation across the network.

Mycelial networks offer another example. When we see mushrooms scattered across a forest floor we’re not seeing individuals. Each mushroom growing from the soil is a fruiting body rising from the underground web-work of mycelia – the skeletal framework of the colony. Some mycelial colonies have been found to have areas extending over 2000 acres making them some of the largest superorganisms on the planet. The pattern suggests mushrooms as terminal nodes and mycelia as the network backbone.

In ecosystems, large predators constitute a form of top-down management but they themselves are part of the predator-prey relationship – a dynamic that must always seek relative equilibrium with the broader network in which it is embedded. Predators do not have a choice to over-consume prey or stockpile & re-sell it to others. Large ocean gyres also suggest a high degree of top-down control by seasonally establishing the engines of hemispheric weather. The North Pacific gyre becomes more active in the Winter of the northern hemisphere, driving the scale & frequency of storms hitting the pacific northwest of the United States. But the North Pacific gyre is an emergent structure that is itself built upon the properties of a nearly-infinite set of factors. It is not a regulatory structure or a governor by intent or design and there is no top-level group of components that determine its next move. It is a super-system derived from innumerable sub-systems.

Most importantly, all biological systems are guided not by top-down governors or control mechanisms but by feedback from the networks in which they are embedded. This is how nature regulates, preserves, and evolves itself towards greater adaptability. There is no fallible ruler driven to resource over-reach and myopic certainty. There is only the ongoing trial & error of embedded growth tempered by continuous communication between & within organisms.

As computers began to connect across the ARPANET, and with the dawning of the visual internet, the CPU evolved away from being specifically a central control system to become a node within a distributed network. This initial shift quickly challenged the established domains of publishing, content creation, intellectual property, and knowledge management while inviting the crowd into a shared virtual space of increasingly global identity & transaction. The advent of social networks established an organizational structure for connecting the human capital of virtuality, making it easier for like-minded people to connect & share & collaborate non-locally, subtly undermining the very notions of borders, statehood, family, and allegiance. Soon after, the mobile revolution has tipped everything on its side and bundled it into a portable device bringing instantaneous global communication & information access to most people on the planet.

The framework was laid for new forms of emergent, non-hierarchical, distributed collaboration & innovation, to both productive & destructive ends. Groups could now form and coordinate around affiliations, interest, and goals in ways that directly challenged the institutional structures monetizing our production & consumption and regulating our behaviors. It has become vastly easier for small organizations to take on multinational interests, whether in business & innovation or in power & politics. The conflicts we see across the world today are, in large part, a symptom of the younger generations leveraging flat network technologies to rise up against the older generations who long ago settled into their legacy hierarchical power structures. To paraphrase Ben Hammersley, the people who are running the world, who are entrusted with our future, are not able to understand the present. They lack the cognitive tools that are a basic part of the Generation C toolkit – the digital natives who grew up with a mobile in their hands and the internet at their fingertips, embedded in specialized networks that span borders and extend identity into the virtual.

The global disruptions that seem to characterize modernity constitute a civilizational correction driven by natural law. The DotCom bubble went through a correction, shedding excess value and pruning the garden of exuberant innovation to favor only the most fit. It was a good thing, if not painful. We witnessed the correction in the housing bubble and will likely see similar corrections in credit & commodities, as well as a painfully positive correction in energy, subsidized and under-valued for so long. The impacts of climate change are a correction imposed upon the legacy model of industrialization & growth by nature itself – the super-system in which all human endeavor is embedded and to which we are ultimately accountable.

The civilization correction is an emergent regulatory mechanism embedded within natural systems forcing our legacy human systems to progressively modify the unsustainable design patterns of our past. The mechanical metaphor & the computational metaphor are necessarily opening to include the biological metaphor. We can see this in every aspect of technology and it is equally emergent across human behavior & social systems. Nanosystems emulate biosystems. Computation & robotics are integrating with neurology & physiology. Individuals are finding agency & empowerment in leaderless multi-cellular collaborations. The built environment is becoming sensory-aware, communicating with itself through discrete feedback mechanisms. It can be argued that the emergence of the internet and of ubiquitous mobile communication & computation is an expression of our natural instincts to move into closer alignment with our environment; to follow the adaptive design patterns of nature in order to find a more sustainable & equitable posture for our species; a thermodynamic need to seek maximum efficiency in energy expenses. And to express a direct intervention programmed by nature itself to nudge the Anthropocene back towards equilibrium.

Such lofty ponderings aside, our world is undoubtedly approaching an inflection point. Everything appears to be upending and it’s all spread out in glorious detail for everyone to see. The feedback loop between humanity and it’s creations – the biological & cybernetic communication among individuals & groups & cultures & organisms & ecosystems – is tightening and getting more & more dense every day, feeding on itself and forcing exceptional degrees of novelty into becoming. It’s frightening & awesome and the Old Guard can barely see it happening right in front of their eyes. The shift may be apocalyptic, a sudden phase change, or an accelerated-but-managed transition… Probably it will be all of these things in differing degrees & locales. However it happens, the emerging paradigm is much more about networks, messaging, feedback, and biology rather than hierarchy, control, power, and mechanization. Nature is the super-system, the ultimate controller enforcing the laws of physics and prescribing the design templates for fitness & adaptation. If we are, as Kevin Kelley suggests, the sex organs of technology, then our technology is born from the natural imperatives coded deeply into our DNA.

[Justin Pickard notes: Biology PhD friend had issues w/ @chris23's latest (http://bit.ly/e0tJSS), citing hierarchies in social insect colonies, meercats & wolves... Furthermore, some biologists now consider social insect colonies to be superorganisms in their own right; akin to @cascio's ecology of mind?

Me: Yes! I considered diving into ants - lot's of research there. Interesting social structures emerge in higher critters/hives... I'd love to read a rebuttal/extension.]

“The world is in no position to face major new shocks.”

2 Cross-Cutting Risks:
1. Economic disparity: Wealth and income disparities, both within countries and between countries, threaten social and political stability as well as economic development.
2. Global governance failures: Weak or inadequate global institutions, agreements or networks, combined with competing national and political interests, impede attempts to cooperate on addressing global risks.

3 Important Risks in Focus:
1. The macroeconomic imbalances nexus: This cluster of three economic risks – global imbalances and currency volatility, fiscal crises and asset price collapse – is characterized by both internal imbalances (within countries) and external imbalances (between countries).
2. The illegal economy nexus: Illicit trade, organized crime and corruption are chronic risks that are perceived as highly likely to occur and of medium impact. As a highly interconnected nexus representing the illegal economy, however, experts see these risks as of central importance to the global risk landscape.
3. The water-food-energy nexus: Water security, food security and energy security are chronic impediments to economic growth and social stability. Food production requires water and energy; water extraction and distribution requires energy; and energy production requires water. Food prices are also highly sensitive to the cost of energy inputs through fertilizers, irrigation, transport and processing.

5 risks to watch:
1. Cyber-security: cyber theft, cyber espionage, cyber war, and cyber terrorism.
2. Demographic challenges: population “cluster bombs”, global graying and demographic dividends.
3. Resource security: extreme commodity price volatility and extreme energy price volatility.
4. Retrenchment from globalization: In many advanced economies strengthening political forces either directly or indirectly advocate retrenchment from globalization.
5. Weapons of mass destruction: the key WMD risk is felt by most experts to be that of nuclear proliferation, both among states and non-state actors, closely followed by the potential use of biological weapons.

3 ways for leaders to improve their response to complex and interdependent risks:
1. Proactively address the causes, rather than the symptoms, of global risk, identifying effective points of intervention in underlying structures and systems.
2. Devise coordinated response strategies to address the existence of difficult trade-offs and the threat of unintended consequences caused in part by increased interconnectedness.
3. Take a longer-term approach to assessment and response, particularly when seeking to manage global risks that emerge over decades rather than months or years.

There are some really fascinating innovations & opportunities arising at the convergence of embedded sensors, the built environment, 3D modeling, and augmented reality. Buildings, manufacturing chains, cities, and environments are increasingly communicating their run-time processes through embedded sensors & systems. The data streams pouring off these devices are driving rich visualizations in monitoring dash-boards that give operators & managers high-resolution insight into the state of these systems. Soon, these datastreams will be wired into 3D models – perhaps the very same CAD models that were originally developed to construct a building will live on as a real-time model of it’s living operations. Such models of buildings, civic infrastructure, and the environments in which they’re embedded will provide up-to-the-minute assessments of their operations, from at-a-glance macro overviews to incredibly detailed micro reports. Then model branches – mirrors – could be created to run simulations of future states, eg what happens to traffic if we allow 20% more development on the north end of town?

With augmented reality, the potential exists to bus selective overlays from the model & its datastreams out to augmented interfaces. In this way building/civic managers, code enforcers, first responders, environmental analysts, and many others will be able to see the run-time state of their city/building/ecosystem drawn across the real-world. For example, a broken water main downtown would immediately be reflected in the civic model, pinging the Water Dept. dashboards that then route to a field agent’s mobile who uses their AR head’s-up-display to visibly locate the exact location of the leak for repair, possibly pulling up street schematics and a guided 3D repair manual on-site.

This convergence of the instrumented world and it’s virtual representation, mediated by an augmented reality interface between the two, may yield unprecedented opportunities to model & optimize the very structures of civilization.

[Wow! Looks like Screampoint has a big head-start on this...]

[Autodesk is also working on developing tools for sensor-driven Building Information Modeling (BIM).]

Systems & Society 1: Complexity from chris 23 on Vimeo.