New World (Dis)Order

Some good friends came to stay over the weekend just past. They brought with them a couple who are here on holiday from a Eurozone country. Their names should remain anonymous for the purposes of this story.

The couple are both retired now. We got talking about his work in the police force of said Eurozone country before retirement. He had run a division of the  police force whose focus was corporate fraud.

He had assembled an extremely good group of officers, dedicated to rooting out white-collar crime. He clearly is a process kind of guy with a strong sense of social justice. He said that he had designed a process that is now used all over the world that would ensure that investigations undertaken would be done once there was clarity of a high chance of successful prosecution. That meant maximum focus from all his team and maximum chances of success.  

The result was that he uncovered a considerable amount of crime and successfully prosecuted it.

One example he cited was of a major privately held branded business who, when their inventory was nearing its use-by date and remained unsold, would export the goods to their own subsidiary company in Russia. They would then claim a grant from the EU for having exported products outside of the Euro Zone. Then they would repackage the goods in their Russian facility and export the products back from Russia into the EU in order to sell them at the normal price.

The problem was that he was too successful as it turned out. It seems that in many of the other European countries the police’s job was actually to turn a blind eye to this kind of fraud. As a result the national statistics in his country for corporate fraud were higher in aggregate than most other European countries. This made his country look like it was full of fraudsters while the rest of Europe looked squeaky clean. The reality, as he found out, was that in a number of other countries turning the blind eye on fraud reached right to the top.

So he would find himself at conferences discussing the problems of fraud and pointing out to his peers specific crimes that had taken place in their countries that were well known within the police and which had not been prosecuted.

He started to get somewhat unpopular for pointing out that the king had no clothes, and eventually it was suggested that he might like to take an early retirement.

His replacement was a professional bureaucrat who changed the process away from the clear focus on prosecutable offences to one that sought to broaden the mandate of the department – in other words they tried to pursue everything.

The result was very straightforward: The best of the police officers left the unit to go to other places where they could make a difference; the number of prosecuted crimes went down. But the statistics that came out of the change appeared to show something quite different: the number of crimes that were taken to court had gone down and therefore the unit had been successful in reducing corporate crime in the Eurozone country.  

But it gets worse: since rogue companies were no longer being prosecuted for their crimes, they could get on with doing things ‘under the table’ with impunity. They could also tell the people in the know in the government that the result of this policy was that employment numbers could now be more positive, thus adding to the national benefit.

I believe that it is this kind of statistical engineering of the truth that is endemic of what has happened in the US – most visibly and publicly with the Bernie Madoff case.

It seems that no one in the SEC wanted to have to acknowledge that Madoff was a crim, because to do so, would mean that they would have to investigate not just Madoff, but would also have to acknowledge that the system itself was fundamentally flawed.

So instead they ignored him. They let him get away with it until the stench of corruption meant that Madoff called in the cops himself! How about that?

What is the mind set among some senior bureaucrats who look at the statistics and determine from those statistics things that are in the nation’s interest that to the rest of us are entirely wrong?

Don’t answer the question but keep it in mind as you consider the heads of state meeting and schmoozing and making decisions about the future of the world at the recent meetings in Davos. Our heads of state are fed the information that helps them make decisions from the same bureaucrats that ensured that the too successful policeman was moved on to retirement and who failed to investigate Bernie Madoff and many others.  

One of the things that you learn in logic is that if you start with a false hypothesis you are inevitably going to reach a false conclusion.

We are being fed information about the state of the world delivered by our political leaders with the mastery of professional rhetoricians.

And what is being spun to us right now is that we really do need a New World Order.

The N.W.O. will solve all of our problems because there will be one new currency and it will be really, really strong!

And by the way, at the same time, all the leaders of the world are looking at the angry strikes that are starting to happen across Europe and China and are getting extremely scared. So they should be. The last few times this occurred was in Russia, Germany, Spain, China and Cuba. (In that order.) The wild cat strikes that are hitting the UK are as a direct result of an oil company (Total) importing Portuguese workers into the UK and paying them at lower rates than the local British workers. They supply the nomad workers with room and board paid for at UK rates. The nomads end up working for less, get less of a take home and the local economy, already reeling from under the water mortgages, now has to deal with increased jobless numbers.

The difference between now and the last time there was major labour unrest is that now we have instant, digital, universal, communication. It helps companies with productivity, and it equally helps organizers create flash mobs of protesters. Communications that back then took months, now happen in seconds.

But here is the thing that they so often miss when discussing a N.W.O. They talk in terms of globalized trade, globalized economies, globalized currency. What they leave out of the debate is local trade, local economies, and most of all local currencies.

In order to have a globalized currency (which I believe is necessary and inevitable) we also have to have a model for local currencies to be born and to evolve.

These are not currencies for nations, in my view. They are currencies that are sub-national that should be able to evolve within local communities. Their primary function should be to encourage local, community-wide trade and to provide a benefit for local producers and sellers of goods and services to keep circulating work within a community. This would lead to greater local productivity and better living standards at a local, community level.

These local currencies are not dissimilar to barter in my view. But governments have been very down on this sort of thing for a long time because of the potential for people to fall outside of the tax net. However, now governments are looking at a much more serious threat than a few bucks falling outside of the populace’s tax returns. Now our leaders are looking at modern industrialized nations becoming failed states, and doing so on their watch.

In order to reduce the ability for bureaucrats to bend statistics to report things that are 180 degrees off the course of the truth, it is critical that governments start to recognize that local communities are actually the life-blood of a country. Local communities tend to want to stay where they are. Globalized work forces are the modern equivalent of nomadic tribes.

Nomadic tribes have their place, but they should not be rewarded in a way that makes them more competitive than the local community. Local communities take care of the social infrastructure of a village or a town. That has real value, as does the proper and in-depth analysis of statistics.

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