The Decentralized, "Markets Plus" Metaphor

By
Guy M. Burgess
Heidi Burgess

August, 2017

Synopsis:

A second metaphor for organizing a large-scale conflict response is the market.  In this video Guy describes ways that a market might be created for conflict knowledge and skills, and how such a market could greatly increase both the capacity of people to engage in constructive approaches to conflict, and the funding available to support such approaches. 

Full Transcript:

This is Guy Burgess. I want to talk about something we call the market metaphor, which is really another strategy for thinking about large-scale, very complex, very intractable conflicts. 

Remember the big question we have been asking over the last series of posts is, "how do you promote more constructive to approaches to conflict when you're working at the very large-scale of entire societies and many millions of people?"

We have a couple of goals here. We want to increase the utilization of the existing good ideas, and, of course, we want to encourage the creation of even better ideas. Still, the big challenge is figuring out how to implement these ideas at the massive scale of contemporary society. What we want to do is decrease the proportion of conflict interactions that are destructive and increase the proportion of constructive interactions (or corrected destructive interactions).

Over the last series of posts, we've raised a lot of issues that highlight the difficulties associated with promoting more constructive conflict at such a very large scale. We have talked about complex and complicated approaches, the limits of the engineering model, and the obstacles associated with trying to come up with the perfect plan and then trying to implement through that plan through a unity-of-effort, or chain-of-command-based process. It is almost impossibly difficult to get everybody on the same page and working in mutually supportive and reinforcing ways. We also talked about the "fog of war" and the tendency of plans to not survive first contact with the real world. There is also the squishy-influence problem in which even the most powerful people in a society can only really influence a relatively small circle folks around them.

Another problem is that centrally-planned approaches also tend to be power-over approaches. In order for them to work, you have to have incentives that encourage people to follow the plan, along with sanctions for those who do not. This raises conflicts-of-interest problems between the elites (the central planners) and the rest of society who are being told what to do. TWen you have these kinds of conflicts of interest and the enormous power that comes from being able to dictate the central plan, you run into the power-corrupts problem--and that's part of why it doesn't work very well. 

If you go back and look at the history of what we supposedly learned from the Cold War, you find that one of the big lessons was that centrally-planned economies don't work very well. Part of the reason is that they are especially subject to corruption. Nobody wants to work very hard when the fruits of their labor go to somebody else. Another part of the problem is that it is awfully hard to figure out what everybody thinks needs to be done.  Another obvious problem with centrally-planned approaches is that there is currently nothing resembling a consensus on what approach should be taken. Just look at C-SPAN and you can quickly see that we can't agree on much of anything these days. 

So the question becomes, what is the alternative to some sort of engineering, centrally-planned, command-and-control approach? In an earlier post, I indicated that it was the medical model with its focus on the treatment of specific diseases and injuries.

To apply this model at a very large-scale, however, we have do more than focus on the treatment of a specific disease in a specific individual. Instead, we have to think in terms of the complex array of healthcare institutions including medical center campuses, neighborhood clinics with dozens of specialists, self-help media advice columns, and national institutions like the National Institute of Health..

What we are trying to figure out is how to create something on this scale focused on conflict. In the last post I talked about a conflict-handling strategy based on the metaphor of the Google traffic system. That's one approach.

A complementary approach that I want to highlight in this post is based on a market or ecosystem strategy. The truth is that markets are social ecosystems. There's the same sort of competition and a lot of the same kinds of ecological relationships. 

By using a market approach, we try to harness the power of the "invisible hand" to help promote more constructive approaches to conflict. The goal is to get people to do things because they "want to" and because they think that doing those things is in their best interest. We talked more about this in the post on the power strategy mix and the tension between exchange, persuasion and force. This is the key distinction between the invisible hand and the invisible fist. 

So what we are looking for here is not a force-based, invisible fist-based strategy that compels people to do something because they "have to," not because they want to. This tends to create a backlash effect. People so hate being forced to do things against their will that they will launch a counterattack at the earliest opportunity. This means that you may easily generate new enemies faster than you can defeat old ones. Our goal in thinking about conflict intervention in market terms is to promote the idea of "want to" actions, or the invisible hand. People do things because they want to, not because they have to.

Another advantage of the market-based approach is that it breaks the conflict problem down into smaller, more manageable pieces. One way of thinking about this is by going back to a metaphor I used earlier that imagined that dealing with complex conflict was like trying to line up the perfect pool shot in a gigantic table with zillions of balls and zillions of players all trying to shoot at the same time. When we think of things in market terms, however, the focus is on small-scale, essentially bilateral agreements between any two parties who agree to work together to pursue their enlightened self-interest. 

The goal is to encourage lots and lots of these small-scale efforts to push society, in the aggregate, toward the more democratic, power-with end of the continuum and away from the dystopias of autocracy and anocracy that we have been trying to figure out how to avoid. 

Another thing about this small-scale approach is that when you start thinking in terms of small-scale interactions you get back to a way of thinking that is better suited to the cognitive strengths that people have.  This increases the probability that the whole effort will push society as a whole in the right direction. 

The key to making markets work are institutional arrangements that make it possible for buyers and sellers to find each other.

This gives rise to the obvious question what do we imagine buyers and sellers actually trading? Traditionally, economists talk about the exchange of goods and services.  Certainly, there are a large number of conflict handling services that could be provided. Still, in our context, what is most important is likely to be the exchange of expertise. People who have expertise in more constructive ways of dealing with conflict (educators of various types) can engage in a variety of capacity-building activities that distribute that expertise within the larger society. Beyond this, there are, of course, deals that could be made concerning how particular conflicts and disputes could be better handled. 

The other big thing about markets is that the laws of supply and demand apply. If the cost of more constructive approaches to conflict is kept low, the demand for those approaches is likely to be correspondingly strengthened. TUnfortunately, professional conflict intervention is so pricey that it's often only available for a relatively small number of high-stakes and often high profile conflicts. 

So, the key to expanding the accessibility of more constructive approaches is the building of do-it-yourself skills. Rather than having expensive pros come in and do the work, the key is to teach people how to do it for themselves (and their family, friends, and others that they care about).  

There a lot of different kinds of markets. There's the old-fashioned market as exemplified by the "Yellow Pages" where you had a comprehensive index of all the goods and services available in a community. Since everybody had a pretty intuitive sense of what was available, they used the Yellow Pages to find and compare businesses offering similar goods or services.  It was great for handling business-as-usual transactions. The Google search system sort of does this (but doesn't really feature the nice index structure of the old fashioned Yellow Pages).

Beyond this, you get to new markets like those created by eBay, Uber, or Airbnb. These services make it possible for buyers and sellers to find each other and engage in transactions that used to be impossible because the transaction costs were prohibitively expensive. This was something that the new generation of information technologies made possible. 

In many ways I think what we need is a conflict "eBay" that would create a new and much more efficient market for conflict services. Hopefully, it would generate a virtuous circle where people looking for newer and better strategies for dealing with conflict could find people with those ideas. And, people with ideas could make a living sharing those ideas and could afford to develop them further because they know that they'll be able to sell them. This would create new conflict jobs and increase the overall conflict-handling skills of the society as a whole. This would work by both providing conflict-handling services directly and by providing capacity-building services that would increase do-it-yourself skills. 

In some cases this would provide a market for conflict-handling skills and techniques that are simply improved versions of those that are currently available. In a sense, this is like the improvements that come with each new automotive model year. Here one goal is to provide an incentive for people to develop incremental improvements to existing conflict-handling strategies. 

Another thing that we would want to do is encourage radically different and much better conflict handling services. These would be analogous to something like the original iPhone (or the Internet) which came out of nowhere and completely transformed the society.  These were technologies that many leaders of the technology field thought would never amount to anything. In many ways what we need is a comparable paradigm shift in the ways we think about and deal with conflict. The bottom line is that we need a much improved market for incremental improvements in existing approaches as well as radically new ideas. 

When you're bringing new ideas to market, it's not enough to just make them available. You need to make people aware that these options exist and show them why they need them.  This is where advertising comes in. Without it, the traditional, word-of-mouth diffusion of new ideas would take forever. Fortunately, we are living in the era of social marketing and viral media they can make this process a whole lot easier. It's now possible for a really good idea to take off and literally spread around the planet in a very short amount of time. That's something that we should try to cultivate. 

In this context, it is also worth thinking about a distinction that Kenneth Bolding made between the market economy and the grants economy. The regular or market economy consists of straightforward financial transactions between willing buyers and willing sellers. That's where most of a society's money is and where most of the transactions occur. There is also substantial grants economy where people give something to other people because it's the right thing to do and not because they expect to receive something tangible in return. The biggest part of the grants economy governs transactions within families and within closely-knit groups. There is also a much smaller portion of the grants economy which governs the philanthropic sector. Apart from alternative dispute resolution services, it's the philanthropic sector that conflict and peace building professions have historically relied upon for support.. The problem is that there isn't all that much money in this part of the economy. One big advantage that would result from making a market-based approach work is that it would open up the vast bulk of the economy as a realistic funding source. In order for this to be possible, however, the field would have to provide people with services, knowledge, and skills that they would the willing to pay for. One key to being able to do this is, obviously, the ability to hold costs down.

It's also worth highlighting the role plague by the "501(c)(3)" nonprofit sector and the new generation of "B corporations" that are legally obligated to advance the common good and not just the bottom line.  These are legal structures that can provide a framework for both market and grant-based funding mechanisms.

Finally, we shouldn't talk about a market-based approach without spending a couple of minutes acknowledging that there are failures of the marketplace that lead it to do destructive things. We need to find ways of guarding against things like this that can throw a monkeywrench into the ability of markets to advance "invisible hand" solutions. These apply regardless of whether you're dealing with a very simple markets in developing countries, advanced markets like the New York Stock Exchange, or the conflict markets we would like to create. 

One problem is deceptive marketing. It is very easy for people to promise that they have developed wonderful new approaches when, in reality, they just don't work and may even be counterproductive. If we are not careful, unscrupulous players in the conflict field could create our own equivalent of a Ponzi scheme.

There's also the tendency of markets to concentrate wealth and power in the hands of a few. In developing this market-based approach,  we have to be careful not to concentrate sophisticated conflict skills in the hands of a few people who can use them in Machiavellian ways to advance their selfish agenda. 

Somehow we also have to deal with the posterity trap -- the tendency of people to resolve short-term disputes on the backs of future generations (who, by definition, don't have a seat at the table). That's a huge problem with respect to climate change and lots of other issues. 

The bottom line is that market-based approaches focused primarily around low-cost capacity building services should, in theory, be able to tap a vastly larger funding pool. And, these resources can make it possible to dramatically scale up conflict and peace building efforts to the point where they are part of the mainstream society and not just a niche field. But we have to protect against the downsides of market approaches as we do that.

Photo Credits:

Slide 4: Unity of effort -- Source: http://www.dtic.mil/doctrine/doctrine/jwfc/uef_qr.pdf; Permission: Public Domain.  Org Chart – Source: https://commons.wikimedia.org/wiki/File:Org_Chart_for_Office_of_Secretary_of_Defense.png;  Public domain, via Wikimedia Commons. Moltke – Source: https://commons.wikimedia.org/wiki/File:Helmuth_Karl_Bernhard_von_Moltke.jpg; Permission: Public Domain.

Slide 6: Karl Marx -- Source: https://commons.wikimedia.org/wiki/File:Karl_Marx.jpg; Permission: United States Public Domain. Adam Smith – Source: https://commons.wikimedia.org/wiki/File:AdamSmith.jpg; Permission: Public Domain.

Slide 7: C-SPAN Screenshot – Public Domain.

Slide 8: Naval Medical Center. By U.S. Navy photo by Mass Communication Specialist 2nd Class Chad A. Bascom [Public domain], via Wikimedia Commons. X-ray. By Bill Rhodes from Asheville (mid-shaft humeral compound comminuted fx lat). CC BY 2.0, via Wikimedia Commons. EColi By Credit: Rocky Mountain Laboratories, NIAID, NIH [Public domain], via Wikimedia Commons.

Slide 9: Medical Campus – Source: https://en.wikipedia.org/wiki/File:AerialLACUSChighres.jpgl By: GC2009; Permission:  Creative Commons Attribution-ShareAlike 3.0. NIH Logo – Source: https://commons.wikimedia.org/wiki/File:NIH_logo.svg; Permission: Public Domain.

Slide 10: Adopt a Highway – Source: https://www.flickr.com/photos/oddharmonic/5744394253; By: oddharmonic; Permission: Attribution-ShareAlike 2.0 Generic (CC BY-SA 2.0).

Slide 11: Charles Darwin: Source: https://commons.wikimedia.org/wiki/File:Charles_Darwin_photograph_by_Herbert_Rose_Barraud,_1881.jpg; By Herbert Rose Barraud; License: Public Domain. Origin of Species: Source: https://commons.wikimedia.org/wiki/File:Origin_of_Species_title_page.jpg; License: Public Domain. Adam Smith – Source: https://commons.wikimedia.org/wiki/File:AdamSmith.jpg; Permission: Public Domain. Wealth of Nations – Source: https://commons.wikimedia.org/wiki/File:Wealth_of_Nations_title.jpg; Permission Public Domain.

Slide 16: Steam turbine. Source: https://commons.wikimedia.org/wiki/File%3ADampfturbine_Montage01.jpg; Attribution: Siemens Pressebild. CC-BY-SA-3.0, via Wikimedia Commons. Oil gas station blueprints. Source: https://commons.wikimedia.org/wiki/File%3AJoy_Oil_gas_station_blueprints.jpg; Attribution: Joy Oil Co Ltd [Public domain], via Wikimedia Commons.

Slide 17: Monkey Wrench – Source: https://commons.wikimedia.org/wiki/File:Monkey_wrench_derivative_from_Rogers_1903_p172.png; By: William Rogers ; Permission: Public Domain. Market -- Source: https://commons.wikimedia.org/wiki/File:Paramaribo,_Suriname_(11987836025).jpg; By: MM; Permission:  Creative Commons Attribution-Share Alike 2.0 Generic. NYSE -- Source: https://pixabay.com/en/stock-exchange-trading-floor-738671/; By: skeeze; Permission:  Creative Commons CC0.

Slide 18: Shopping Cart Icon – Source: https://pixabay.com/en/shopping-cart-empty-pictogram-sign-307772/; By: Clker-Free-Vector-Images; Permission:  Creative Commons CC0.

Slide 20: DIY Tools – Source: https://commons.wikimedia.org/wiki/File:Basic_DIY_Tools.jpg; By: SElephant; Permission:  Creative Commons Attribution-Share Alike 3.0 Unported.

Slide 21: Yellow Pages – Source: https://www.flickr.com/photos/allergictowork/26387486391; By: Katle; Permission: Attribution 2.0 Generic (CC BY 2.0).

Slide 24: Subaru – Source: https://www.flickr.com/photos/30474136@N07/15623136813; By: TuRbO_J; Permission: Attribution 2.0 Generic (CC BY 2.0).

Slide 25: iPhone – Source: https://www.flickr.com/photos/janitors/15707819731; By: Kārlis Dambrāns; Permission: Attribution 2.0 Generic (CC BY 2.0).

Slide 27: Madison Avenue – Source: https://commons.wikimedia.org/wiki/File:Madison_Ave_NYC_looking_nor.jpg; By: Leif Knutsen; Permission:  Creative Commons Attribution-Share Alike 3.0 Unported. Word of Mouth Word Cloud – Source:  https://pixabay.com/en/word-cloud-social-media-words-639318/; By: narcisco; Permission: Public Domain.

Slide 29: 501(c) Letter – Source: https://commons.wikimedia.org/wiki/File:501(c)3_Letter.png; Permission: Public Domain. Source: https://hbr.org/2016/06/why-companies-are-becoming-b-corporations

Slide 30: Monkey Wrench – Source: https://commons.wikimedia.org/wiki/File:Monkey_wrench_derivative_from_Rogers_1903_p172.png; By: William Rogers ; Permission: Public Domain. Market -- Source: https://commons.wikimedia.org/wiki/File:Paramaribo,_Suriname_(11987836025).jpg; By: MM; Permission:  Creative Commons Attribution-Share Alike 2.0 Generic. NYSE -- Source: https://pixabay.com/en/stock-exchange-trading-floor-738671/; By: skeeze; Permission:  Creative Commons CC0 

Slide 31: Ponzi – Source: https://commons.wikimedia.org/wiki/File:Ponzi.jpg; Permission: Public Domain.