 |
 |
Dear David, Solving the Greek situation is a design problem the Greek government is facing. Perhaps more interesting is to look at design issues and methods of the design situation. Here's an outline sketch of the design situation as I understand it (and most of this comes from Stratfor. I recommend a subscription - less than a daily newspaper). The design analysis is only at the order of one feedback loop. The fundamentals of the Greek design situation are geopolitical. EU wants to become a bigger trading block and the US wants Europe to extend across towards Russia to reduce Russia's geopolitical buffer zone (which it needs for territorial integrity. Greece is and has been economically problematic for many decades. Greece's government wants to stay in power and have an easy life by placating its people. For that (which included the best quality social security arrangements in Europe) the Greek government needs lots of cash and the economy doesn't provide it Joining the EU offered Greece's government the opportunity to get access to very cheap credit on a large scale. Greek gave false financial figures to give Europe the illusion that it was more credit worthy to enable it to join the EU to get access to cheap cash (mainly German). The Greek government continued to provide 'adjusted' financial figures. It appears the approach worked something like an institutionalised Ponzi scheme where new borrowings pay for interest on previous borrowings. The Greek populace enjoyed and got used to the benefits of the country being funded from abroad rather than from the 'sweat of the brow of its population'. To many of the Greek population this obviously has not been apparent. The situation is less obvious in times of increasing wealth. The approach fails in times of economic pressure. The failure occurs both because it becomes harder ( now much harder) to rent money and the benefits of it are less - yet the previously borrowed capital and interest must still be paid. In essence Greek financial future is dependent on people with money feeling trusting enough to lend it to the Greek government on the basis that they will get some profit back. As a design problem, there are three obvious solution paths: 1) Massively reduce the amount the Greek government spends; Change the value of the Greek currency; 2) find someone with a different reason to lend Greece the money than simply profit on interest. The second and third are what form the interesting parts of this design problem. Reducing the amount that the Greek government spends directly affects those who have benefited and who have got use to being benefited by the Greek government's aims in keeping in power and keeping the population happy. This is now coming back to bite in spades. The Greek government, however, still wants to remain in power. Reducing cash flow to beneficiaries can only go so far before the government is rejected. Civil disturbance is a normal part of this process. Greece is not able to change the value of its currency. It is locked into the Euro. As an aside, UK banks and economy are in a similar mess. The UK would be in Greece's position, except, it can devalue its currency, which is what it is doing informally. This has minimal civil disturbance effects because people see the same salaries and pay cheques going into their banks. The change in value of the currency, however, means that prices will creep up as exchange rates affect new products coming through the supply chains. It will be most likely to be first noticed in food because the UK imports over half of its food. Back to Greece, Greece could secede from the EU. This would be seriously embarrassing for the EU and indicate that the EU as an economic union it is not financially strong enough to protect its members. In effect the EU's credit rating would fall. From the Greek side, secession from the EU would lose Greece the protection of the EU and its access to 'cheaper than it could be' credit as well as lose the military security support of the EU. Instead, as a design strategy Greece can leverage the problems that it is giving the EU to gain future benefits from the EU in a sort of polite game of blackmail. The third part of the design situation is even more interesting. Mainland Europe is dominated by Germany and France. Germany is geopolitically insecure because of its location between France and Russia. Germany's natural protection strategy is imperial expansion. Germany is both the strongest economic nation in Europe and the financial cornerstone of Europe. Over the last 60 years, the US has guaranteed German security; in return Germany has foregone its expansion strategy and has funded Europe whilst not controlling Europe. Recently, American security guarantees for Germany have become less secure and America has been sending adverse economic signals (e.g. the Opel affair in which the US supported a sort of double cross of Germany by GM) . Simultaneously, Russia is both twisting Germany's arm (control of access to fuel in winter) and cozying up in friendship as a security guarantor. In parallel, Germany appears to have reached a change of emotional position becoming unhappy to fund and bail out Europe's financial problems. At the same time, the other EU countries banks are going though their financial own crises. This means they are unwilling to bail out Greece. Together, this places Germany in a key position politically, economically and geo-politically and with potential to change the game. Germany is poised to take over the EU and control of Europe. This is THE interesting design situation for all of Europe's members. How does each of Europe's countries' governments design their own geo-political strategies to enable them to make the best of this situation both now and for the future? In this, Greece is a side show. For what it is worth, design methods developed by myself and colleagues in Perth indicate that an effective strategy for many nations might be selective disruption that increases the variety that Germany and other potentially controlling powers have to deal with. Expect riots , threats and increase in social tensions. All of these, however, are part of larger design strategies relating to control of oceans, future markets and territory. Expect a wide variety of external participants to be involved in the European action including US, Russia, China, Iran and Turkey. Geo-political design strategies must and will incorporate them. Now is the really interesting part. The above design analysis appears to say a lot and is mentally stimulating and accessible. It gives something for us to think about and gives the illusion that we understand the situation. Worse, it gives the illusion that we understand the situation enough to design intervention. In reality, as a design approach it is useless. Its a basis for amateur guessing rather than professional design. In reality, the geopolitical situation has multiple feedback loops. A professional design approach would be to model the situation using system dynamics or similar and then observe which factors have more or less effect and how the effects of strategic interventions play out. Multi-feedback loop design methods using system dynamics are now well tested by the US and other players in Iraq and Afghanistan. The problem, as a design process, is using system dynamics whilst managing very short term high leverage events (e.g. deaths of leaders, small window actionable intelligence). Similar situations occur in any complex multi-loop design situation. The US has recently included Design as part of Field Manual 5.0 Operations Process for Battle Command. Here in Australia, Commanders are thinking through implications. My reading over the last week has suggested there is more to think about on this. The developments should soon start to filter through to design research, design education and design practice . Just two penneth from oz, Best wishes, Terry ____________________ Dr. Terence Love, FDRS, AMIMechE, PMACM School of Design and Art Director Design-focused Research Group, Design Out Crime Research Group Researcher, Digital Ecosystems and Business Intelligence Institute Associate, Planning and Transport Research Centre Curtin University, PO Box U1987, Perth, Western Australia 6845 Mob: 0434 975 848, Fax +61(0)8 9305 7629, [log in to unmask] Visiting Professor, Member of Scientific Council UNIDCOM/ IADE, Lisbon, Portugal Honorary Fellow, Institute of Entrepreneurship and Enterprise Development Management School, Lancaster University, Lancaster, UK ____________________ -----Original Message----- From: PhD-Design - This list is for discussion of PhD studies and related research in Design [mailto:[log in to unmask]] On Behalf Of David Sless Sent: Thursday, 6 May 2010 8:36 AM To: [log in to unmask] Subject: Re: Greece Clive and all On 06/05/2010, at 10:14 AM, Clive Dilnot wrote: > Mark Edwards is undoubtedly technically correct in his observation > regarding the appropriateness of airing thoughts on Greek social unrest > in the hallowed spaces of the PhD design list I'm not so sure. It's clear that I'm sceptical about the value of Terry Love's preoccupation with the large scale. Nonetheless, this should not preclude it from consideration. I would have thought the Greek situation could be considered a candidate for inclusion as a large scale design problem. Over to you Terry (BTW, I think he is away from his desk for a few days, so we might have to wait a little while for Terry to solve the 'Greek problem') David -- blog: www.communication.org.au/dsblog web: http://www.communication.org.au Professor David Sless BA MSc FRSA CEO Communication Research Institute helping people communicate with people Mobile: +61 (0)412 356 795 Phone: +61 (0)3 9489 8640 Skype: davidsless 60 Park Street Fitzroy North Melbourne Australia 3068