AT THE INTERSECTION: EXAMPLES FOR THE MATRIX

by Dr. James W. Jackson

Founder, Project C.U.R.E.
Author, The Happiest Man in the World: Life Lessons from a Cultural Economist

We have now discussed the components of economic production: Land, Labor, Capital, and the Entrepreneur, and also the components of our cultural structure: Traditions, Institutions, Family, and the Individual. Our premise is that Transformation takes place at the intersection of Culture and Economics. Wherever the components of Culture and the components of Economics cross in the intersection of real life, you can expect change.

I’m going to resort to the chalk board and see if we can walk through some common examples in order to see just how such a thing works. The components of Economics will be positioned along the left side of our matrix and the components of Culture will follow the bottom line. The dynamics of the situational example will determine the point of intersection and which of the components will be involved in the confrontation that sets up the incidence of transformation:

• We talked earlier about the incredible global transformation that took place based on the intuition and action of Alexander the Great after being influenced by the cultural and economic insights of his personal teacher, Aristotle. He conquered the known world.
• Two hundred seventy- one years later, Julius Caesar laid claim to Alexander’s dream and once again, transformed the global system at the intersection of culture and economics.
• King James of England, in 1606, granted rights to a business investment company to establish the first American colony in an area designated as Virginia. But the second contract was made with another organization to establish a colony in America. That contract was born out of conflict and the desire for change and freedom. The Pilgrims were a group of settlers who had previously left England to seek relief and freedom in Holland. Disappointed there, they found investors willing to underwrite the expenses of a contract to colonize in America. On September 16, 1620, the Pilgrims set sail on the Mayflower and landed sixty-five days later. At the intersection of culture and economics, the Pilgrims employed their powerful traditions and even religious institutions and families. They set into motion transformation in areas of land use, labor, and capital and the individuals eventually realized the fruits of a new world

• Eventually the American Revolutionary War between young America and England would be fought at the intersection of culture and economics. Institutions, traditions, families and individuals were pitted against each other on matters of land, labor, capital, and entrepreneurial enterprises.

• Within recent years, China’s citizens have experienced immeasurable transformation due to national laws implemented in 1979 limiting the family’s size to one child per couple. I personally visited many orphanages throughout China and have been acquainted with the affects of the policy that was fully centered at the intersection of culture and economics. The policies were initiated to alleviate social, economic and environmental problems in China, but have set into motion firestorms of consequences.

• A bit closer to home . . . we commonly experience the intersection phenomenon in controversial land use situations. Traditions endeavor to dictate how a certain piece of property will be used regardless of personal or institutional ownership rights. Or, a municipality may want to appropriate or condemn a property and build a big box store or commercial strip in order to generate higher tax revenues. The battle is waged at the intersection of culture and economics.

• Divorce settlements, civil suits, and estate squabbles so very frequently find the principles yelling at each other in the middle of the intersection of culture and economics.

• Individual families, also, find themselves hammering out philosophical differences at the intersection when it comes to making decisions regarding how they will earn and spend their resources.

• Don’t be surprised when it dawns on you that this same matrix works even for such issues as dealing with the disciplining of the children, (Land = Resources, Labor = Activities, Capital = Rights and Rewards, Entrepreneur = Creativity and Independence). We can count on major transformation taking place at the intersection of culture and economics even when applied to the components involved in domestic situations.

We live in a world of transformation. It is good for us to concern ourselves with how we can more efficiently allocate and manage our resources and abilities. It is also to our benefit to discover and understand how various aspects of human cultures interact with economic events, behaviors, and conditions. Economic philosophies and systems have the power to affect and shape our culture, as well as our culture having influence on our political systems, inherited traditions, religious beliefs and the formation of our institutions. It is imperative to lay aside the notion that economic has only to do with money. It is also imperative to more fully comprehend the scope and sequence of culture.

As we move into a more complete understanding of the eight components listed herein, and see how they work together under a larger umbrella of cultural economics, our identification of problems and even our tasks of conflict resolution will be more easily accomplished.

Next Week: Our Market Basket

(Research Ideas from Dr. Jackson’s new writing project on Cultural Economics) 

© Dr. James W. Jackson  

Permissions granted by Winston-Crown Publishing House

www.drjameswjackson.com  

Dr. James W. Jackson often describes himself as "The Happiest Man in the World." A successful businessman, award-winning author and humanitarian, Jackson is also a renowned Cultural Economist and international consultant, helping organizations and governments to apply sound economic principals to the transformation of culture so that everyone is "better off."

As the founder of Project C.U.R.E., Dr. Jackson traveled to more than one hundred fifty countries assessing healthcare facilities, meeting with government leaders and "delivering health and hope" in the form of medical supplies and equipment to the world's most needy people. Literally thousands of people are alive today as a direct result of the tireless efforts of Project C.U.R.E.'s staff, volunteers and Dr. Jackson. 

To contact Dr. Jackson, or to book him for an interview or speaking engagement: press@winstoncrown.com

AT THE INTERSECTION: CULURAL COMPONENTS

by Dr. James W. Jackson

Founder, Project C.U.R.E.
Author, The Happiest Man in the World: Life Lessons from a Cultural Economist

Our stated premise is that transformation (global, national, corporate, domestic, personal) takes place at the intersection of culture and economics. We just finished discussing the four basic production components of economics: Land, Labor, Capital, and the Entrepreneur. Now it’s time to examine the cultural components.

It is necessary to have an agreed upon definition when discussing the concept of culture. No, we are neither talking about growing a microorganism in a laboratory Petri dish, nor are we describing an artsy enlightenment trip to Carnegie Hall in New York City or an art museum in London. Culture, as we will be discussing, can be described as the inherited and shared beliefs, attitudes, feelings, values, ideas, customs, and social behaviors of a particular people.

There are at least four strategic components that are utilized in order to perpetuate a culture: Traditions, Institutions, Families, and Individuals. It is not my intention at this point to get involved in a thorough investigation or discussion of these four components. I must admit, however, that it is a temptation to get off track and share with you some of the incredible customs, traditions, and institutions I have witnessed in my world travels over the past nearly thirty-five years (everything from simple birthday celebrations to male and female rites-of-passage circumcision rituals of the Maasai tribe in Kenya and Tanzania). We will stay on point.

TRADITIONS

The term tradition comes from the Latin tradere that literally means to transmit, to hand over, to give for safekeeping. It is a belief or pattern of behavior in a community with special or symbolic meaning that has been handed down from generation to generation and might persist and evolve for thousands of years. The concept of tradition is viewed as a set of precedents valued by a culture and carries with it the notion of holding on to a previous time. Traditions are extremely important to a given group. History bears out those traditions are many times considered worth dying for. Wars have been fought and civilizations eradicated because of traditions.

INSTITUTIONS

Institutions are designed to formalize and perpetuate agreed upon traditions. They work to give structure, influence and even power to the sustainability of those social orders deemed most important to a people group.

On the surface, institutions look a lot like churches, hospitals, jails, banks, and schools. But, more formally, they describe normative systems that take care of regulating the distribution of goods and services, the providing for the legitimate use of power, the transmitting of knowledge from the present generation to the next generation, and the lending of structure to moral and religious matters. Institutions end up mediating the agreed upon rules that govern social behavior of a group.

FAMILY

As a component of culture, family has to do with kinship. Here again, this is not an involved dissertation on the current interpretation and aspects of the modern family. When dealing, however, with the premise that all transformation takes place at the intersection of culture and economics, the cultural component of family is paramount.

Family is considered more than just a basic social unit consisting of parents and their children, whether dwelling together or not. It extends to any group of persons closely related by blood, as parents, children, uncles, aunts, and cousins, etc.

Historically, kinship has played a huge role in developing, establishing, and perpetuating traditions. Likewise, the family units of a people group are the most powerful influence and factor of sustainability when it comes to the success of institutions.

INDIVIDUAL

Recall for a moment the list of production components of economics that we discussed last session: Land, Labor, Capital, and the Entrepreneur. We learned that nothing happens without the Entrepreneur. So it is with the components of culture . . . nothing happens without the Individual.

From the traditions, from the institutions, and from the family, the individual emerges as the ultimate building block of transformation and change.

Now we are ready to plug these eight components into our social economics matrix and apply them to the phenomenon of transformation.

Next Week: Examples for the Matrix

     (Research Ideas from Dr. Jackson’s new writing project on Cultural Economics)

Dr. James W. Jackson often describes himself as "The Happiest Man in the World." A successful businessman, award-winning author and humanitarian, Jackson is also a renowned Cultural Economist and international consultant, helping organizations and governments to apply sound economic principals to the transformation of culture so that everyone is "better off."

As the founder of Project C.U.R.E., Dr. Jackson traveled to more than one hundred fifty countries assessing healthcare facilities, meeting with government leaders and "delivering health and hope" in the form of medical supplies and equipment to the world's most needy people. Literally thousands of people are alive today as a direct result of the tireless efforts of Project C.U.R.E.'s staff, volunteers and Dr. Jackson. 

To contact Dr. Jackson, or to book him for an interview or speaking engagement: press@winstoncrown.com

POSTPONED DEBT

by Dr. James W. Jackson

Founder, Project C.U.R.E.
Author, The Happiest Man in the World: Life Lessons from a Cultural Economist

As a cultural economist, I am very curious about the phenomenon of postponed debt that I observe as I travel around the world. Cultural economics tries to deal with both sides of one coin: How do the people affect the economics of a culture? And: How do the economics of a culture affect the people? The issue of postponed debt has everything to do with economics and everything to do with culture . . . and also, it has everything to do with character.

In many of the Lesser Developed Countries (LDC) where I travel, if more money is needed to meet the economic demands and pay the bills, a very simple method is used. The dictator simply prints more currency. That method has an immediate impact on the value of the existing currency. With the same amount of goods in the market, but additional money in the system that was printed and spent, the prices for those remaining goods in the system go up. No one has to vote or agree for the price to go up, they just do. For example, if there were ten cherry pies and there were ten dollars in the money system, each cherry pie would cost you one dollar. But, if another ten dollars were to be created and put into the system, you would have twenty dollars chasing the ten cherry pies, and you would end up paying $2 to purchase your desired pie. The pie wasn’t really worth more, but the value of the money was worth less. 

In the U.S., our method is a bit different. When the Congress overspends, the Treasury is overdrawn. The Treasury creates and issues treasury bills and bonds and sells them at auction (IOUs), on the assumption that someone, some institution, or some foreign entity would rather have an interest-paying bond than a cherry pie. For the government to pay off the T-bills and bonds, it is necessary to either raise taxes on the citizens, sell off national assets, e.g. oil reserves, coal reserves, harbor and port rights, national forests, military armament, air space, etc., or allow the Federal Open Market Committee of the Federal Reserve Bank to start calling in the IOUs and paying them off. What Method would they use to pay off those T-bills and bonds? You guessed it . . . more newly created money!

A bond dealer would receive the T-bills or bonds and make the appropriate payment to the holder. The Federal Reserve Bank would receive the T-bill or bond and issue a check to the bond dealer who, in turn, would deposit that check into his bank account. The check, when deposited, would be credited by the Federal Reserve Bank to that bank’s required fractional reserves and that bank would then be entitled to make loans against that new reserve, or exchange it for cash. Why did the Federal Reserve Bank have the right to issue the check? Because it was backed up by the U.S. Treasury IOU that it just purchased!

In essence, what happens in the transaction is that the federal debt, a liability, is transformed into an asset by the U.S. Treasury signing a note, and the note becoming an asset of the Federal Reserve Bank. In other words, the debt of the government has been miraculously turned into spendable money. That is called monetizing the federal deficit! It gives an illusion and a false assurance that the government has a never ending source of money and store of wealth.

Those T-bills and bonds have an intended and expected postponement in being paid back. Some may be designed to not be paid back for up to thirty years. That postponed repayment defers the immediate impact on the monetary system. And when the debt instruments are paid back, they are nearly always paid back with money from more postponed debt, generated by the selling of more T-bills and bonds. The ultimate effect, however, is exactly the same as if the government did not issue the T-bills and bonds in the first place, but simply satisfied its debt with newly printed currency fresh from the presses.

The combination of postponement of the debt, and inflation, is the ultimate, subtle taxation. No one escapes the effects of inflation. When employing the method of inflation to settle overspending, there is no cost to the government for collecting taxes, no votes have to be taken for approval, and the government is the sole beneficiary. Those decisions come from the people who affect the economics of our culture. The activity ends up being a form of the old Ponzi scheme, where the early investor is hopefully repaid by the investment of a later investor. But I have never heard of any country in history whose traditional economic system could tolerate the monetizing of $26 trillion dollars into its system. Historically, a more likely result would include bankruptcy and civil conflict.

So, what is the psychological problem with the postponement of debt? How do the economics of a culture affect the individual people? William Shakespeare instructed us, "Defer no time; delays have dangerous ends." And, we might add that postponement is perhaps the deadliest form of denial, because the longer we wait, the more the sharp edge of urgency wears off. Our minds actually start telling us that the responsibility to keep the promise is not that important anyway. Something that can be done at any time will probably be done at no time. Postponement and the ignoring of accountability can become cultural suicide on the installment plan. Many of the leaders of foreign countries I visit really believe that the loans the U.S. has made to them should now just be forgiven and forgotten. They figured that they would repay “someday,” and then discovered that “someday” is not a day of the week.

I am sensing that the people of our culture have carefully observed our attitudes of looseness toward the integrity and responsibility regarding debt. The assumption seems to be that it makes no difference if we purchase homes we can’t afford, or lease cars without concern of the residual balance at the end of the contract. When one credit card is maxed out, just go get two more, stack up student loans depending on the political leaders to simply forgive the ballooned amounts before the next election, and make personal commitments and relational promises we have no intention of keeping. I think we have some serious problems that have resulted from a breakdown of integrity and accountability.

Albert Einstein said, “We can’t solve problems by using the same kind of thinking we used when we created them.” And a culture can’t rationalize away what it has behaved itself into. The heart has reasons that reason does not always understand. We can be assured that where there is an intellectual disconnect from personal integrity, the reasoning and intellect will try to synthesize a substitute connection for justification. I think when it comes to integrity, in order to change the culture there has to be a change of heart. The economic practices of a culture will definitely affect the people. And the morals and integrity of the people involved will ultimately affect the economics of a culture.

Dr. James W. Jackson often describes himself as "The Happiest Man in the World." A successful businessman, award-winning author and humanitarian, Jackson is also a renowned Cultural Economist and international consultant, helping organizations and governments to apply sound economic principals to the transformation of culture so that everyone is "better off."

As the founder of Project C.U.R.E., Dr. Jackson traveled to more than one hundred fifty countries assessing healthcare facilities, meeting with government leaders and "delivering health and hope" in the form of medical supplies and equipment to the world's most needy people. Literally thousands of people are alive today as a direct result of the tireless efforts of Project C.U.R.E.'s staff, volunteers and Dr. Jackson. 

To contact Dr. Jackson, or to book him for an interview or speaking engagement: press@winstoncrown.com