Where We Are on the Looping Sequence of Reformation

Something is happening here and you don’t know what it is,
Do you, Mr. Jones?

— Bob Dylan, “Ballad of a Thin Man”

From Wall Street to Los Angeles, sea to shining sea, occupiers are taking to the streets. No longer is it credible to say of protests and massive civil unrest abroad “It will never happen here.” To do so today would be a denial of reality.

It is here…wherever that “here” may be for you. And if it is not, it soon will be.

For many Mr. and Mrs. Joneses, this is quite a confusing time. Frightening, even. They know something is happening here…but they don’t know what it is. And that includes many of the Joneses in the occupying camps themselves. They know they are angry…that they have been dealt a rotten hand…that they are the “have nots.” But they don’t know why…or who to blame. Then, along comes an “open source” movement. They didn’t even know such a thing existed a few weeks ago. But they are drawn to its energy and their fellow downtrodden within it. The see that it is going somewhere, doing something. It is on all the news channels and in the paper. And now they are neck deep in it, swept along with the tides of change, resistance and revolution.

The oldies put on their old Dylan records and imagine they are young again. The young put on their new Dylan records and wish they were old enough to remember the originals. They link arms, swap sad stories and reason that they are on the same side, the team of the cheated and the scammed. On this point they might well be right. But on what to do about it, opinions differ wildly. And so the movement marches on…some say right into the winds of a new kind of “reformation.”

Here’s John Robb of Global Guerrillas, an expert in open source warfare, with a “simplification of the historical pattern of Reformation”:

  • Universal system.
  • Compliance and participation enforced by violence.
  • Bureaucratic and lethargic. Corrupt and unfair. Hardship and misery.
  • Loss of legitimacy.
  • Challenged by reformers. Corruption exposed.
  • New technology unleashes a cacophony of criticism.
  • Reforms are rejected by the existing bureaucracy.
  • New, competitive systems are launched.
  • An exodus begins. People leave the old system to join the new.
  • The old system fights back. A fight ensues between the old and the new.
  • Eventually a peace is achieved and a new era begins.

If indeed Mr. Robb’s thinking here is correct — or even close to it — one might fairly ask, “Where are we, approximately, along this historically looping sequence?”

Certainly the “compliance and participation enforced by violence” point has been with us for a while…as has the bureaucracy, lethargy, corruption and consequent misery for the masses. But what about the rest?

Some might argue that the financial collapse of 2008-09 first exposed the fetid corruption of the system, causing its legitimacy to be, at the very least, called into question. Further along the steps, the Occupy Wall Street crowd has formerly adopted the “open source warfare” Mr. Robb describes — enabled largely by huge leaps in communications technology. The OWS movement is based on the Arab Spring model — horizontal, no hierarchy or bureaucracy, geographically decentralized, consensus decision making, etc. Now take a look at the movement. Listen to it. “Cacophony of criticism unleashed”? Check.

That leaves us somewhere between “Reforms are rejected by the existing bureaucracy” and “New, competitive systems are launched.”

The world is lurching toward an impasse, a crossroads between the old and the new. Awaiting rejection from the establishment…and mounting challenges to its hegemony. It is an epoch of sorts. A chance for a brand new experiment in freedom and voluntarism…or an opportunity to dive back into the failed model of the state, only to begin the loopback process all over again.

The role of the economist — and for any astute social observer — is to shine a light on the unseen. Any old wirebug can report what’s happening before his very eyes. But what’s going on behind the scenes? What’s happening on the fringe? Change, after all, is nurtured at the margin, far from the nipple of the bell curve…far from anyone calling themselves “the other 99%.”

There is, indeed, another movement under way. Its participants are not wasting time camping out on Wall Street or attending occupations in other capital cities. And they’re certainly not marching on the steps of Washington DC, as one republican presidential candidate — who hopes one day to occupy the White House himself — urged them to do. They know there’s no point in pleading with those who aggress against them. They understand it’s like asking a sociopath to show them a little empathy. It’s impossible. And a waste of valuable time just the same. These people realize that, to be successful, an appeal to reason must be first directed toward reasonable people.

These individuals also know there is a target on their back…and that there’s little point talking to the maniac with the gun. They have gone underground. They are saving — NOT “hording” — gold, trading alternative currencies, experimenting with resilient communities, preparing for a new world and generally thinking outside the box.

And they are not begging permission from the state to do so.

These revolutionaries are not utopians. They are realists. They understand that change must come about peacefully, through means of voluntary exchange and the spread of ideas. And they are building communities — on and offline — to facilitate just that. Above all, they are aware, as Murray Rothbard expressed in his work, For a New Liberty, that they must pay close attention to the failed experiments of history if they wish not to repeat them. Wrote Mr. Rothbard:

“The idea of a strictly limited constitutional State was a noble experiment that failed, even under the most favorable and propitious circumstances. If it failed then, why should a similar experiment fare any better now? No, it is the conservative laissez-fairist, the man who puts all the guns and all the decision-making power into the hands of the central government and then says, ‘Limit yourself’; it is he who is truly the impractical utopian.”

More on this to come…

Joel Bowman
for The Daily Reckoning