Good ideas never really die. In 1971, Stafford Beer and a team of Chilean and European systems scientists designed a Cybernetic system, CYBERSYN, with which President Salvadore Allende and his ministers could manage the Chilean economy in real time. A brief account of the Cybersyn project is given by Andy Becket in this Guardian article.
Now, Malcolm Gladwell, in the New Yorker, tells us that :
"A few years ago, Vivek Ranadivé wrote a paper arguing that even the Federal Reserve ought to make its decisions in real time-not once every month or two. "Everything in the world is now real time," he said. "So when a certain type of shoe isn't selling at your corner shop, it's not six months before the guy in China finds out. It's almost instantaneous, thanks to my software. The world runs in real time, but government runs in batch. Every few months, it adjusts. Its mission is to keep the temperature comfortable in the economy, and, if you were to do things the government's way in your house, then every few months you'd turn the heater either on or off, overheating or underheating your house." Ranadivé argued that we ought to put the economic data that the Fed uses into a big stream, and write a computer program that sifts through those data, the moment they are collected, and make immediate, incremental adjustments to interest rates and the money supply. "It can all be automated," he said. "Look, we've had only one soft landing since the Second World War. Basically, we've got it wrong every single time."
You can imagine what someone like Alan Greenspan or Ben Bernanke might say about that idea. Such people are powerfully invested in the notion of the Fed as a Solomonic body: that pause of five or eight weeks between economic adjustments seems central to the process of deliberation. To Ranadivé, though, "deliberation" just prettifies the difficulties created by lag. The Fed has to deliberate because it's several weeks behind, the same way the airline has to bow and scrape and apologize because it waited forty-five minutes to tell you something that it could have told you the instant you stepped off the plane.
Of course, if the President of the USA, (or any other country) really wanted to run the economy for the benefit of the people as a whole rather than financial and corporate fat cats, Ranadivé's proposal would be near the top of the government's agenda.and he himself would be one of Obama's key advisers. After all, as everyone knows, its the whole economic system that is broke and it needs systems thinkers to mend it.
That's the difference between a genuine, honest democrat like Allende and the pseudo-Democrats currently in power.
