Dividing the Labor to Ensure a Strong Economy

Neither the private nor the public sectors can ensure successful economic growth alone, but by recognizing this division of labor, DPEs can channel government and corporations toward mutually reinforcing successes. Attention to this division of labor and the structural properties that guide each sector can help achieve significant economic gains. Governments can work to create enabling political economy frameworks (like the Global Information Instrastructure/Internet) that are beyond the scope of private enterprises, yet significantly enhance economic opportunities. [2]

Companies drive economic activity by investing in potential profit-making activities while governments strive to provide enabling frameworks for economic prosperity. The corporation has emerged in modern times with a legally-shaped fiduciary duty to maximize shareholder value through return on investment (ROI). This legal stance tends to marginalize “ESG” (Environmental, Social, and Governance) concerns, including labor concerns such as fair wages, equal opportunity, sufficient benefits, and adherance to labor laws. The influence of ESG on investor decision-making continues to grow, including pressure to reduce environmental “externalities,” the costs paid by third parties when a product or service destroys or pollutes air, land, or water.

Democratically elected governments want to organize infrastructure, legal systems, and services to create economic value for voters and maintain political power for themselves and their party. Failure to enable and entice investment and produce economic success within a political boundary can raise significant difficulties for a government and its internal populace. Unstable economies can experience rapid de-investments due to the mobility of capital.

Globalization of commerce and finance since the 1970s has created new forms of competition and mobility for capital. This trend has challenged the economic base of national and local governments as they compete with each other to attract fluid multinational capital. Tax cuts facilitated US capital flows into China and other low-cost producers, reducing inflation but also jobs and infrastructure investments. At stake are jobs and investment returns.

While capitalists are often quite capable of success at the microeconomic level, they are not in a position to manage the economy as a whole. Towards procuring that success, corporations lobby governments and conduct other activities to influence government actions that will help their companies and industry.

Entrepreneurs and other people in business and professional services tend to be highly focused on their own profitability while spending only limited resources on community and civic affairs. Market activities are competitive and barriers to entry transitory. Private activities are insufficient and unable to maintain parks, libraries, roads, and other public goods that enhance the quality of life. And yet, these public goods are often responsible for attracting capital and talent needed for innovation and competitiveness.

As a result, democratic political economies tend to divide the responsibilities for modern economic life. Corporations focus on commercial and financial success. Governments provide, among other things, a judicial system to protect contracts, educational support to train workers, and administrative support to protect the populace from pollution and other dangers. Each shares an interest in robust commercial activities, albeit for differing reasons.

Perhaps most important is a monetary system that facilitates transactions and maintains price stability. DPEs primarily use a fractional reserve banking system that creates money through debt. This is capitalism’s “pedal to the metal” economic system that creates what what economists like Joseph Schumpeter and Werner Sombart called “creative destruction.” Modern Monetary Theory (MMT) has effectively argued that currency issuers like national governments play a crucial role in wealth production by supplying much-needed money and debt instruments. Governments spend money into the economy so companies and consumers have the liquidity to produce and consume.

When it comes to ensuring a successful and prosperous political economy, democratic societies have certain structural conditions that guide the emergence of their particular form of capitalism. Within limits, the political economy can take a variety of forms, such as highly exploitive and accumulation-oriented oligarchies or, on the other end of the scale, a highly redistributive society. Effective development strives for high integration strategies that balance accumulation and distribution strategies.[3]

Neither the public nor private sector in modern democratic societies have sufficient managerial or policy competencies to ensure a thriving economy. Yet, both rely on a vigorous economy for their success. Each needs economic success to satisfy their respective electoral and fiduciary constituencies. Despite the division and differing reasons, the goal is the same, a vibrant economy that will ensure both private profits and political triumph.

Governments look to the fruits of a growing economy to offset spending for debt interest, defense, and other services, including welfare. They aim to maintain a happy populace that will keep them in office. They want a prosperous economy to keep people employed, keep share prices high, and keep investment flowing into productive activities that will keep people feeling economically secure and provide tax revenues.

The private sector, in general, is unable to ensure overall capitalistic growth on its own. It lacks sufficient organizational capacity to ensure success at the macroeconomic level. That does not mean the private sector cannot infiltrate governance and the policy sphere. Donald Regan, the former CEO of Merrill Lynch, played a significant role in shaping the economic policies of the Reagan administration. As Secretary of the Treasury and Chief of Staff, he helped define and implement “Reaganomics,” emphasizing tax cuts, deregulation, and tight monetary policy. Along with Citicorp CEO Walter Wriston and others, they shaped a global framework based on capital mobility, fiat money, and credit markets. Still, it was not their roles as heads of major financial institutions but their participation in the US political administration that shaped a high accumulation, low distribution DPE with national and global implications.

While corporations are often quite capable of success at the microeconomic level, they are not in a position to manage the economy as a whole. The private sector wants growth and profits as well. Corporations strive to fulfill their primary fiduciary responsibilities – maintaining high profits for owners and shareholders. Towards procuring that success, they lobby governments and conduct other activities to influence government actions that will help their companies and industry. However, while these attempts may help individual companies or industries, they are insufficient to ensure the success of capitalism as a whole.

The Republic’s Interest in the Economy

In the first of the major structural mechanisms that Fred Block proposed to explain why government officials pursue policies that are in the general interest of capitalism. According to his view, government officials are, to some extent, dependent on the level of economic activity that 1) allows the state to finance itself through taxation or borrowing and 2) maintains popular support among the voting citizenry. Significant business investment, high employment levels, and minimal government competition for surplus capital are the most common strategies for ensuring high tax receipts while keeping the voting public relatively content.[4]

Governments require a monetary base to help fund their activities, whether meeting the bureaucracy’s payroll, building infrastructure, or funding defense activities, munitions, and personnel. According to MMT, governments also provide a monetary system to standardize the currency used in the collection of taxes. While MMT argues that national governments are currency issuers that create wealth when they legislate money. Taxes do not provide revenues for government spending, but provide a regulatory mechanism to limit inflation due to consumer and investment spending. These actions are often needed to reduce prices and motivate official economic activities that use the prescribed currency.

In the US, both Democrats and Republicans have spent liberally. The “Double Santa Claus” argument was set forward by Wall Street Journal editorial writer Jude Wanniski in 1976. In “Taxes and the Two Santa Claus Theory,” he argued that the Democrats should be the spending “Santa Claus” and redistribute wealth while the Republicans should be the tax reduction “Santa Claus” and help spur income growth. The Reagan administration institutionalized this approach with increased spending on anti-poverty programs such as Medicare, Social Security, and food assistance programs like the Supplemental Nutrition Assistance Program (SNAP). Military spending increased dramatically, including investments in new weapon systems, most notably, the Strategic Defense Initiative (SDI), commonly known as “Star Wars.” SDI proposed a space-based missile defense system designed to protect the United States from potential nuclear missile attacks and inadvertently laid the foundation for the Internet. Meanwhile, he drastically cut taxes with the Economic Recovery Tax Act of 1981 and the Tax Reform Act of 1986.[5]

Tax policies affect people and groups differently. They advantage different groups and disadvantage others. In the process, they make specific governmental trajectories possible. DPEs generally tax a combination of capital gains, income, sales of goods and services, etc. Inheritance taxes, for example, are meant to not only collect revenues but also impose a cost on the transfer of wealth and limit familial privilege and class divisions. The makeup of these tax policy decisions helps dictate an economic direction, so taxation policies should focus on what they want to diminish or limit.

Administrations also produce debt instruments that help offset government spending. In the global digital financial economy, government expenditures increasingly fund a significant amount of education, healthcare, military, research and other expenditures.

Taxation and borrowing offset their spending activities and programs, and help ensure a robust commercial sphere. Excess spending in the US is limited legislatively as part of the Reagan administration’s major changes to the financial sphere.

These instruments also provide safe collateral and an important hedge for the financial sectors. The US dollar is also produced as a global currency called the “Eurodollar.” International banks produce this version of the US dollar through lending and is not regulated by the US administration. Since over 80% of global trade is facilitated by the US dollar, Eurodollars bring important liquidity to international trade. But these banks often require high quality collateral like US Treasury bonds or blue chip corporate debt to ease any hesitancy to lend.

The global trading environment is complex and requires constant trading in various financial instruments. Government debt allows traders to increase their trading activities by allowing them to hold government securities in their portfolios as a hedge against other speculative losses. Government bonds are also traded constantly in high-frequency markets for arbitrage opportunities, debt rollover, income opportunities, and as a store of potential liquidity.

Common economic doctrine argues that governments compete with the private sector for capital. Still, in reality, government spending increases the commercial and financial spheres by expanding the trading environment, facilitating transactions, and providing instruments for risk reduction. These expenditures are why the US dollar has become the dominant global reserve and transaction currency. The volumes needed are huge, and the US has been willing to go into fiscal and trade deficits to provide the currency to the world.

Elected officials also need to keep the voting populace materially happy to stay in office. Economic indicators play a vital role in the public’s perception of the economy. These indexes provide numerical representations of various states of the economy, from consumer confidence to price levels and the latest unemployment rates. In an age when pensions and retirement accounts are invested in the financial markets, the public also follows such indicators as the Dow Jones Industrial Average (DJIA) and NASDAQ to gauge their personal wealth. Many older voters see policies that increase corporate wealth, such as tax cuts, as more valuable than government expenditures on food stamps or other forms of personal welfare as they increase stock prices for mutual funds and retirement accounts.

Significant structural relationships make the business of the economy, the business of government. For one, modern democratic governments have significant fiscal determinants that compel them to establish a major stake in the economy. Voters expect sufficient government services from military, regulatory agencies, and some degree of welfare support for the disadvanged. These desires are tempered by the “taxpayer’s money” myth that says that government needs to tax voters before public money can be spent. But governments are “currency issuers” that tax and borrow for other reasons. In order to obtain the needed financing to run the government, provide for the national defense, monitor the economy, and conduct special programs.

Influence Channels and Cultural Constraints

The business class is acutely aware of the effect government has on their interests and work towards shaping that influence, whether it be depressing the minimum wage, alleviating environmental restrictions, or shaping tax policy. Many critics of democratic political economies argue that influence gives capital concerns sufficient control over the state. For Block however, it is the first of several reasons, the “icing on the cake.” Other structural factors are at work and need to be considered.

Two “subsidiary structural mechanisms” according to Fred Block are also important when it comes to shaping the actions of public administrators towards enhancing economic growth. These are influence channels and cultural hegemony.

The first of the subsidiary structural mechanisms are the influence channels. The private sector can exert significant pressure on the state through its ability influence politicians, especially in a media age requiring significant expenditures on TV and other mediums for advertising. The aims of this influence has generally been oriented towards the procurement of government contracts, favorable economic legislation, tax cuts, regulatory relief, labor control, and specific spending in certain areas. They are most often campaign contributions, lobbying activities, and other favors.

Undoubtedly, issues related to bribery, coercion, and the revolving door into higher paying jobs may be factors that influence policy actions, however, this does not discount larger structural factors at work, particularly the high costs of elections, and procuring media buys for competitive elections and public relations. These have tied government officials to the influence of economic concerns.

Cultural hegemony was cited as a second subsidiary structural mechanism. Unwritten rules infiltrate democratic political economies, which tend to indicate what is, and what is not acceptable state activity. “While these rules change over time, a government that violates the unwritten rules of a particular period would stand to lose a great deal of its popular support. This acts as a powerful constraint in discouraging certain types of state action that might conflict with the interests of capital.”[6]

A contemporary example is the cultural divide over immigration. Issues related to race, including systemic racism, police brutality, racial inequality, immigration policy, and affirmative action, continue to be sources of contention and polarization in American society. Several major cultural divide issues have become prominent in political discourse, such as fundamental values, beliefs, and identities. “Culture wars” over social and cultural issues such as abortion, LGBTQ+ rights, same-sex marriage, religious freedom, and gender identity are particularly important in the age of social media and shape public opinion, electoral dynamics, policy debates, and social movements.

One potent issue is climate change. President Trump withdrew the US from the Paris Climate Accords because of a growing cultural backlash against concerns about climate pollution influencing weather effects worldwide. Many of his “Make America Great Again” (MAGA) members were convinced that such actions would be too expensive, hurt economic progress, and threaten a lifestyle centered on oil-based products, technologies, and transportation. Others refused to believe the scientific discourse and labeled it “elite” science. But mostly, vital interests in petrochemical-related industries drive the discussion on climate change through media practices such as astroturfing to avoid a significant “carbon bubble” collapse. For the most part, liberal progressive movements have embraced sustainable technologies and renewable energies such as hybrid cars, solar panels, and low-carbon food systems.

Summary

While sharing broad common objectives for a robust political economy, the government and the private corporate sectors have differing motivations and strategies for reaching these aims. Despite the division and differing reasons, the goal is the same, a robust economy that will ensure both profits and political success. Neither can, by themselves, ensure successful economic growth, but by recognizing this division of labor and the structural properties that guide each sector, democratic political economies can guide government policies and corporations toward mutually reinforcing successes. [7]

Citation APA (7th Edition)

Pennings, A.J. (2024, Apr 12). The Division of Labor in Democratic Political Economies. apennings.com https://apennings.com/democratic-political-economies/the-division-of-labor-in-democratic-political-economies//

Notes

[1] When I was in graduate school studying public administration and political economy, one the authors that interested me was the sociologist Fred Block. In debates with instrumentalists about “ruling classes,” he delineated the set of structural mechanisms that I primarily use here to determine the relationship between governments and the private sector in modern political economies. In this Jacobin article he provides a 2020 epilogue on his classic work.

[2] An interesting situation about enabling frameworks emerged with President Obama’s “You didn’t build that” statement during the 2012 presidential election campaign.

“If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you’ve got a business — you didn’t build that. Somebody else made that happen. The Internet didn’t get invented on its own. Government research created the Internet so that all the companies could make money off the Internet.”

The statement quickly received criticism by Governor Romney, a successful businessman, and others as an example of government encroachment in the private sector. The criticism echoed a similar critique against Vice-President Al Gore’s “I took the initiative to create the Internet.” Certainly, the Internet has progressed to be a major medium of global commerce due to entrepreneurial initiatives and accomplishments. However, much of the initial research and development, as well as the policy framework, was created by a wide range of government actions that transformed what was essentially military technology into commercial products and services.

[3] Tehranian, Majid. (1990). Technologies of power : information machines and democratic prospects / Majid Tehranian ; foreword by Johan Galtung. Norwood, NJ : Ablex Pub. p.184.

[4] This is basically a rewrite of my 2018 post that I wrote after Trump was elected president. I started with a disussion of whether a president with business experience is more important than a president with good understanding of administration and politics. Fred Block’s work was particularly useful and much of the ideas of a structural division of labor is based on his work, including this quote on p. 14.

[5] In the US, the “double Santa Claus” argument was set forward in “Taxes and the Two Santa Claus Theory” by Wall Street Journal editorial writer Jude Wanniski. He argued that the Democrats should be the spending “Santa Claus” and redistribute wealth while the Republicans should be the tax reduction “Santa Claus” and help spur income growth.

[6] This is basically a rewrite of my 2018 post that I wrote after Trump was elected president. I started with a disussion of whether a president with business experience is more important than a president with good understanding of administration and politics. Fred Block’s work was particularly useful and much of the ideas of a structural division of labor is based on his work, including this quote on p. 14.

[7] This blog is dedicated to my brother, Richard Pennings, who died on April 12, far too young.

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Anthony J. Pennings, PhD is Professor at the Department of Technology and Society, State University of New York, Korea. Before joining SUNY, he was on the faculty of New York University where he taught digital economics and comparative political economy. He also taught at St. Edward’s University in Austin, Texas, Marist College in New York, and Victoria University in Wellington, New Zealand. He has also been a Fellow at the East-West Center in Hawaii.

Category: democratic political economies
Tags: "taxpayer's money" myth > Donald Regan > Modern Monetary Theory (MMT) > Reaganomics

Digital Disruption in the Film Industry – Gains and Losses – Part 3: Digital FX Emerges

Posted on | March 17, 2024 | No Comments

“To succeed predictably, disruptors must be good theorists.” – Clayton Christensen

I had a chance to attend a special showing of The Wrath of Khan (1982), the second Star Trek movie, with my daughter a few years ago at the University of Texas in Austin. It included a live appearance by William Shatner, who starred as the infamous Captain Kirk in the movie as well as the original series. Shatner told the story of how Paramount executives were jealous of the success of Star Wars (1977) and how that led to the resurgence of the Star Trek franchise and incidently, the first use of digital special effects in a movie.

This post discusses the beginning of the digital or computer-generated imagery (CGI) revolution. Previously I wrote about the emergence of the digital camera and the digital disruption caused by non-linear digital editing. Incidently, I happened to be one of the first academics to teach non-linear editing with the University of Hawaii obtained the first Avid.

It seems appropriate that Star Trek would make both film as well as computer history. Its first attempt, Star Trek: The Motion Picture (1979), was moderately successful, but very expensive due to its grandiose sets. The second movie was given over to Paramount’s television studios who tightened the script and economized on the sets. They also hired George Lucas’ Industrial Light and Magic (ILM) to produce some of the effects for the second movie. ILM created an entirely computer-generated sequence for a movie when it demonstrated the effects of the Genesis Device on a barren planet in what turned out to be the Wrath of Khan.

But was it the first? Or was it Westworld (1973) Going back in history another case emerges that might lay claim to the first digital scene.

But first some background on the move from analog film to digital visual media. Previously, most special effects in films were done by artists using various analog methods. Animation was mainly drawn by hand, frame by frame. Even another futuristic 1982 movie, Tron, displayed results that were stunning for the time, but they were painstakingly done frame by frame.

The origin story for digital FX goes back to 1964 when NASA was directing the first flyby of Mars. NASA was working with its Jet Propulsion Lab (JPL) to develop an imaging system for Mariner 4. They needed to code the shading of 40,000 dots to construct the first image of Mars. Numbers were sent back to Earth from the spacecraft and the first images were actually colored in a “paint by hand” project based on the digital numbers. Some 240,000 bits were aggregated into a series of numbers on a globe.

John Whitney Jr. wrote in the American Cinematographer (November, 1973) that Brent Sellstrom struggled with a problem of representing a robot’s point-of-view (POV) on film. The script of Westworld called for a way to show how the evil robot cowboy, played by bald 70s icon Yul Brynner saw the world. The post-production supervisor for Westworld had to find a way to get the audience’s viewpoint into the head and eyes of the evil robot, the way the mechanical device was seeing the world. The POV shot takes the audience into a character’s head to give them a first-person, or subjective experience. [1]

Sellstrom suspected that JBL’s digital scanning methods might be used to construct the robot’s point-of-view in Westworld. JBL’s estimate to do the job for two minutes of animation would take nine months and cost $200,000. This price was way over their budget so they hired another company Information International, Inc. to scan footage of the robot’s POV and convert it to numerical data with similar techniques to the ones developed at JBL. It used a series of 3600 rectangles. They had to make sure that clothes of the actors and other items were contrasted to other items on the set. It took a minute for each frame and eight hours of processing for 10 seconds of film footage. The scene provided needed POV shot that brought the audience into the robot’s experience and movie went on to be a major hit. In 1976, a sequel called Futureworld scanned and animated its star, Peter Fonda’s head, for the first appearance of 3D computer graphics in a movie. Obviously, a precursor to Max Headroom.[2]

Throughout the 1990s, advancements in computer hardware and software, particularly in rendering and animation technologies, enabled more realistic and sophisticated digital effects. Films like Jurassic Park (1993) and Terminator 2: Judgment Day (1991) showcased groundbreaking CGI that blurred the line between reality and computer-generated imagery. The rise of dedicated visual effects studios, such as Digital Domain, Industrial Light & Magic (ILM), Pixar, and Weta Digital, played a crucial role in driving innovation in digital FX. These studios employed teams of talented artists, technicians, and engineers to push the boundaries of what was possible with digital technology.

Filmmakers began integrating live-action footage with CGI elements seamlessly, allowing for the creation of fantastical worlds, creatures, and visual sequences. Films like The Matrix (1999) and The Lord of the Rings trilogy (2001-2003) pushed the boundaries of digital FX, setting new standards for realism and spectacle. The development of digital character animation techniques, exemplified by films like Toy Story (1995) and Shrek (2001), revolutionized the animation industry and paved the way for the creation of lifelike digital characters that display complex emotions and personalities.

Technologically, ILM’s Renderman, that was spun off to Pixar, has been particularly noteworthy. RenderMan was one of the first rendering software packages to enable the creation of photorealistic images in CGI. Its advanced rendering algorithms and shading techniques allowed filmmakers to achieve lifelike lighting, textures, and reflections, enhancing the realism of digital environments and characters. RenderMan’s impact on digital FX has been recognized with numerous awards, including Academy Awards in 27 of the 30 films to win the Oscar for Best Visual Effects by 2018. Its contributions to the field of computer graphics have been instrumental in advancing the art and technology of filmmaking.

Finally, a note on digital disruption from Clayton M. Christensen talking about the corresponding changes in the computing industry. Christensen argues that the tendency of good customers to always listen to their best customers and improve their products leave them open disruptive innovations. The early digital cameras for example completely surprised film supplier Kodak. More currently, the digital camera has made possible DIY streaming services like YouTube.com.

In my next post on this series, I intend to explore the introduction of artificial intelligence (AI) such as SORA and VIDU to the digital televisual world.

Citation APA (7th Edition)

Pennings, A.J. (2024, Mar 17). Digital Disruption in the Film Industry – Gains and Losses – Part 3: Digital FX Emerges. apennings.com https://apennings.com/technologies-of-meaning/digital-disruption-in-the-film-industry-gains-and-losses-part-3-digital-fx-emerges/

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Notes

[1] Background on the role of JPL on digital movie-making from American Cinematographer 54(11):1394–1397, 1420–1421, 1436–1437. November 1973.

[2] Frances Bonner. Fiction 2000: Cyberpunk and the Future of the Narrative (1992) in Slusser, G. and Shippey, T. eds. (Athens: University of Georgia Press)

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Anthony J. Pennings, PhD is Professor at the Department of Technology and Society, State University of New York, Korea. Before joining SUNY, he was at New York University from 2002-2012 and taught film at Marist College in New York and at the University of Hawaii where he often participated in the Hawaii International Film Festival while at the East-West Center in Honolulu, Hawaii. He also taught digital media and metrics at St. Edwards University in Austin, Texas, where he lives when not in Korea.

Category: characteristics of digital media, creative industries, cultural Industries, digital destruction, disruption, multimedia, technologies of meaning, visual literacy and rhetoric
Tags: Digital Domain > Futureworld > Genesis Device > Inc. > Industrial Light & Magic (ILM) > Industrial Light and Magic (ILM) > Information International > Kodak > Pixar > Star Trek: The Motion Picture (1979) > Westworld (1973) > Weta Digital

Four Futures and the S-Curve

Posted on | March 13, 2024 | No Comments

One of my favorite professors in graduate school was Jim Dator, a professor at the University of Hawaii and Director of the Hawaii Research Center for Futures Studies at Manoa. His favorite strategy for thinking about the future was an exercise discussing four types of potential scenarios for the future of humanity: Continued Growth, Transformation, Limits and Discipline, as well as Decline and Collapse.

I include this approach in discussions about different futures strategies in my Introduction to Science, Technology, and Society Studies (STS) course to get students to think more about the trajectories of new technologies and social developments and what they may mean for the world they are inheriting.

I also include a discussion of the S curve initiated by futurist John Smart’s interpretation of Dator’s four scenario exercise, as illustrated above. S-curves, also known as sigmoid curves, are mathematical models often used to describe the adoption or growth rate of various phenomena over time. Examples would be the adoption of Artificial Intelligence (AI) or the growth rate of bacteria in a lab sample. This representation is based on living systems theory by James Miller but seems to fit well with other examples, including Dator’s futures writing exercise. However, Dator saw the scenarios more as four generic, separate alternative futures rather than naturalistic growth phases that could be represented with the sigmoid curve.

Scenarios are narratives or ‘stories’ illustrating possible visions of a future. These scenarios provide a structured way to consider the components of alternative futures and their potential developments. It presents four broad scenarios or perspectives on the future that can help individuals and organizations think about and plan for different possible outcomes. They are not strictly predictions but rather help generate ideas of some possible futures.

Combining an understanding of S-curve dynamics with futures scenario can be useful in projecting trajectories, isolating trends, and constructing visions of likely outcomes. It also marks inflection points (IP) where the variations in the curvature suggest the beginning of a significant change. Also important are tipping points (TP), critical thresholds when a tiny perturbation can qualitatively alter the state or development of a system or society, indicating dramatic change. DP marks the decline or de-acceleration phase. GP (growth point) and SP (saturation point) are also critical indicators of a curve’s dynamics.

S-curves are commonly used to predict the adoption and lifecycle of technologies or products. Innovations such as personal computers, smartphones, and social media platforms have been analyzed using S-curves to predict their growth and market saturation. As they move through stages of introduction, growth, maturity, and decline, S-curves can provide insights into when these stages are likely to occur and their duration. Researchers like Everett Rogers used S-curves to explain the “diffusion of innovations,” describing how new ideas or technologies are adopted by a population over time. For example, understanding the adoption patterns of electric vehicles can help policymakers develop incentives, infrastructure, and safety standards.

The categories below expand on the four scenarios mentioned above.

Continued Growth projects the current emphasis on economic development and its social and environmental implications into the near future. In this scenario, the future is seen as an extension of the present. It assumes existing trends, systems, and patterns will continue without significant disruption. This business-as-usual (BAU) trajectory is represented in the upward orange curve.

Limits and Discipline emphasize the importance of rules, regulations, and control. In this perspective, the future is shaped by enforcing strict controls and adhering to established norms and principles. It is a scenario that focuses on order, authority, and conformity. It suggests a society that highly values places, people, processes, or values that are threatened by the existing economic and social trajectory. In this scenario, it is often believed that society has “limits to growth” and should be “disciplined” around a set of fundamental cultural, ideological, scientific, or religious values. These will likely involve environmental concerns, including “green” solutions such as recycling, social distancing, and mask-wearing in pandemic times.

It could also result from a backlash to accelerated technological developments such as AI and the increasing collection of personal data by cloud services. Robotics is another concern as the technology has a more obvious manifestation than AI. Understanding where this saturation point lies in the S-curve can help predict when growth will likely slow down or stabilize. It is represented by the blue line that reaches a plateau after the tipping point. S-curves often reach a plateau, indicating that the phenomenon is saturated in society or approaching its maximum potential.

Decline and Collapse is represented by the descending green line on the right. This scenario envisions a future characterized by the breakdown of existing systems, institutions, or structures. It suggests a catastrophic turnaround or reversal of fortunes due to natural or human-made disasters. It often involves a significant crisis or disruption that leads to a reevaluation of the way things are done. Will climate change create such a decline? Is nuclear war a possibility? Pollution and changes associated with massive carbon dioxide and methane releases are current concerns as they are linked with dramatic weather changes influencing droughts, floods, and wildfires. The challenge to US leadership in the world by China and Russia could lead to a dramatic escalation of war in the world as witnessed in Ukraine.

Finally, a Transformative society envisions a future marked by radical change, innovation, and the emergence of entirely new paradigms. It challenges individuals and organizations to think creatively, embrace innovation, and be open to transformative possibilities. It emphasizes the need to adapt and thrive in a rapidly changing world. It anticipates a radical makeover of society based on biological, spiritual, or technological revolutions. For example, the creation of new genetically reconfigured “posthuman” bodies is a possibility, perhaps due to the viral innovations of COVID-19 research or rapid adaption to environmental changes. A “singularity” of network-connected humans and AI is another projected scenario. A global set of religious revivals is also considered by many to be a possibility. These scenarios posit entirely redesigned global culture, economic, and political structures.

Dator emphasizes that the purpose of scenario visioning is to determine preferable futures and work towards them rather than prophesizing a specific future. While S-Curves add a temporal trajectory and can indicate future activities, they lack information about time-frames. It is difficult to use them to suggest the number of months, years, decades, or even centuries before they might take shape and play out.

These scenarios are not meant to predict specific outcomes but to provide a structured way to consider different possibilities and their implications. By exploring these scenarios, individuals and organizations can better prepare for a range of future developments and make informed decisions about their strategies, policies, and actions. Dator’s Four Futures framework is a valuable tool for futures thinking and scenario planning.

By analyzing historical data and fitting an S-curve to the data points, it may be possible to gain an understanding of how a particular phenomenon has emerged over time. S-curves can then be used to extrapolate future growth. By extending the curve into the future, you can estimate points when a particular phenomenon is likely to change or reach a certain level of adoption, maturity, or impact. Policymakers can use this information to predict future developments, allowing for better long-term planning and resource allocation.

Citation APA (7th Edition)

Pennings, A.J. (2024, Mar 13). Four Futures and the S-Curve. apennings.com https://apennings.com/political-economies-in-sf/jim-dators-four-futures-and-the-s-curve/

Notes

[1] I was working on my PhD on cyberspace and electric money and found the four futures approach interesting. Dator dissuaded his students of the idea of a one true future whose probability could be calculated with positivistic certainty, and suggested we use a futures visioning process to envision and develop several alternative scenarios.
[2] The notion of ideal types comes primarily from Max Weber.
[3] Dator’s Four Futures presents four broad scenarios or perspectives on the future that can help individuals and organizations think about and plan for different possible outcomes. These scenarios provide a structured way to consider alternative futures and potential developments. The four generic alternative scenarios are: four generic alternative futures” (continuation, collapse, discipline, transformation) Dator, Jim. (2009). Alternative Futures at the Manoa School. Journal of Futures Studies. 14.
[4] Alvin Toffler’s Future Shock (1970) is a book that explores the concept of rapid change and the challenges it poses to individuals and societies. While Toffler introduced the idea of future shock, he did not specifically outline “four scenarios of the future” in that book. Instead, he discussed various scenarios and trends related to technological, social, and economic changes.

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Anthony J. Pennings, PhD is a professor in the Department of Technology and Society, State University of New York, Korea. SUNY Korea offers degrees from Stony Brook University. From 2002-2012 was on the faculty of New York University. Previously, he taught at Marist College in New York and Victoria University in Wellington, New Zealand. He lives in Austin, Texas when not in South Korea. He also spent 9 years at the East-West Center in Honolulu, Hawaii, including time working on his PhD in Political Science.

Category: digital monetarism, futurists, political economies in sf, science and technology studies, smart new deal, sustainable development
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The Future of US Democracy: Getting Excessive Money Out of Elections

Posted on | March 3, 2024 | No Comments

The 2010 Supreme Court (SCOTUS) decision in Citizens United v. FEC ruled that corporations and unions could spend unlimited amounts of money on political campaigns. This was despite a Pew Research Center survey in late 2023 that found that both Republicans and Republican-leaning independents (83%) as well as Democrats and Democratic leaners (80%) agree that wealthy people contributing money to members of Congress can have too much influence on their policy decisions. In general, most Americans believe that excessive money in US politics can undermine the principles of accountability, equality, and fairness that are essential to a functioning democracy.

This post introduces the problem of money in US politics. This danger includes the disproportionate influence of wealthy donors, the erosion of democratic principles, the undermining of fair competition in elections, policy capture and the distortion of policy priorities, as well as the potential for corruption and scandal. Money also plays a significant role in US political advertising, influencing the reach, frequency, and effectiveness of political messages on broadcast channels and through social media. The post then looks at some ways Americans can address the issue through a combination of legislative reforms, legal challenges, grassroots activism, and civic engagement.

Problems Associated with Excessive Money in US Politics

When political campaigns are heavily funded by wealthy individuals, corporations, and special interest groups, there is a risk that these donors may wield undue influence over elected officials. This distortion can undermine the principle of political equality and lead to policies prioritizing donors’ interests over the general public’s needs. Political scientists are now talking about a “donor class,” a small group of wealthy urban and suburban residents who are able and willing to influence the outcome of political elections. Excessive money in politics can erode public trust in the democratic process by creating the perception that politicians are beholden to their wealthy donors rather than accountable to the electorate. This can lead to disillusionment with the political system and decreased voter interest and turnout.[1]

Large campaign war chests can create “barriers to entry” for candidates without access to significant financial resources. This competitive disadvantage can limit the diversity of candidates running for office and discourage individuals from underrepresented communities or with limited financial means from seeking elected positions. Incumbent politicians, in particular, generally have an easier time raising campaign funds compared to challengers. They can leverage their position in office to solicit contributions from political action committees (PACs), donors, and interest groups who have a vested interest in maintaining access and influence with elected officials.[2]

Excessive money in politics can also lead to “policy capture,” where wealthy donors, corporations, and special interest groups leverage their financial resources to gain access, influence decision-making, and shape policy outcomes in ways that benefit their interests, often at the expense of the broader public interest. These powerful interest groups can shape legislation and administrative regulations in their favor. A combination of campaign contributions, lobbying, and other forms of political influence can result in policies that benefit narrow interests at the expense of the broader public good. Policy capture predominantly occurs when regulatory agencies tasked with overseeing specific industries or economic sectors become influenced or controlled by the interests they are supposed to regulate.[3]

Political candidates and parties rely on campaign contributions to fund their campaigns. When wealthy donors, corporations, or special interest groups contribute significant amounts of money to political campaigns, they may gain access to elected officials and policymakers, who can feel indebted to their donors and more inclined to advance policies that align with their interests. Political campaigns that rely heavily on fundraising may prioritize issues of interest to wealthy donors over pressing societal concerns that affect a broader population segment. This skewed focus can lead to a misalignment between government priorities and the needs of ordinary citizens. A major concern is that Political Action Committees (PACs) and Super PACs can raise and spend unlimited money to support political candidates, parties, or causes and exert significant influence over the political process through their financial resources.

The influx of large sums of money into political campaigns can create opportunities for corruption and unethical behavior, such as quid pro quo arrangements where politicians exchange favors for campaign contributions. This obligation can lead to bribery, influence peddling, and other forms of corruption that undermine the integrity of the electoral process and erode public confidence in elected officials. Even if such behavior is not illegal, it can undermine public confidence in the integrity of elected officials and the political process.

Money and Media

The 5-4 Citizens United v. FEC decision by SCOTUS unleashed extraordinary amounts of money for purchasing media airtime, producing advertisements, and targeting specific audiences. Candidates who spend more on advertising tend to also receive more favorable coverage or greater visibility in news stories and analyses, further amplifying the impact of their advertising efforts.

Money can also be secretly used by foreign governments to pay social media platforms, fake news websites, bloggers, and other online channels. These channels can be hired to spread disinformation, misinformation, and propaganda to influence public opinion, sow discord, or undermine trust in democratic institutions. This influence can include spreading false information about candidates, parties, or electoral processes.

Time and column space can be purchased on television, radio, newspapers, and digital platforms to broadcast their messages to voters via memes and other pernicious forms of messaging. The cost of advertising varies depending on factors such as the size of the media market, the popularity of the programming, and the timing of the ad placement.

Creating high-quality political advertisements requires financial resources to cover expenses such as production costs, talent fees, and ad agency fees. Candidates often invest in professional production teams to create polished and persuasive advertisements that resonate with voters.

Money allows political advertisers to target specific demographic groups, geographic regions, or voter segments with tailored messages. By using data analytics and targeting tools, advertisers can optimize their ad spending to reach the most relevant and receptive audiences.

Political candidates and campaigns with greater financial resources have a competitive advantage in advertising. They can outspend their opponents, saturate the airwaves with their messages, and respond quickly to attacks or developments in the campaign.

Money facilitates the production and dissemination of negative advertising. “Mudslinging” has been a particularly effective method in shaping public opinion and swaying undecided voters. Negative ads often require substantial financial resources to fund extensive research, testing, and distribution.

In addition to candidate campaigns, outside groups such as super PACs and advocacy organizations play a significant role in political advertising. These groups can raise and spend unlimited amounts of money independently of candidates, leading to a proliferation of political ads funded by wealthy donors and special interests.

Political advertising spending can also influence media and public relations coverage of political campaigns. Candidates who spend more on advertising may receive more favorable coverage or greater visibility in news stories and analyses, further amplifying the impact of their advertising efforts.

A scary issue is foreign governments using social media platforms, fake news websites, and other online channels to spread disinformation, misinformation, and propaganda. This covert activity can include spreading false information about candidates, parties, or electoral processes. These activities are aimed at influencing public opinion, sowing discord, and undermining trust in democratic institutions.

Getting Money out of US Poltics: Options

Efforts to reduce money’s influence probably require overturning the Supreme Court’s Citizens United decision. Many critics argue that the 2010 Supreme Court decision has exacerbated the problem of money in politics and that SCOTUS has become an instrument of the donor class. Although difficult, overturning or amending this decision through constitutional means could help restore balance to the political system.

But other methods should be used to create public pressure for this change. This endeavor would include legislating campaign finance reform, including stronger disclosure requirements, the public financing of elections, empowering grassroots movements, electoral reforms at the local and state levels, and promoting civic education and engagement.

A top priority should be implementing strict campaign finance laws limiting how much money individuals, corporations, and interest groups can contribute to political campaigns. This restriction can help reduce the influence of wealthy donors and special interests and measures such as public financing of elections, contribution limits, and increased transparency in campaign spending should be pursued.

Strengthening disclosure requirements for campaign contributions and spending can increase transparency and accountability in the political process. Requiring timely and comprehensive reporting of political donations and disclosure of donors behind so-called “dark money” groups can help voters understand who is funding political campaigns.

Implementing public financing systems for political campaigns can also reduce the reliance on private donations and level the playing field for candidates who may not have access to wealthy donors. Public financing programs provide candidates with public funds to finance their campaigns, often with restrictions on private fundraising.

Another critical strategy is supporting movements organizing and promoting activism to help counterbalance the influence of big money in politics. Grassroots movements can mobilize public support for campaign finance reform, hold elected officials accountable, and advocate for policies that promote transparency and fairness in the political process.

Electoral reforms such as ranked-choice voting, proportional representation, or open primaries are also possibilities for the future. They can encourage greater competition and diversity in the political arena, reducing money’s influence in determining election outcomes.

Educating citizens about the importance of participating in the political process and empowering them to become informed voters can counteract the influence of money in politics. Encouraging civic engagement, voter registration, and turnout can amplify the voices of ordinary citizens and dilute the influence of wealthy donors.

Conclusion

Excessive money in political elections corrodes the democratic process by distorting representation, undermining public trust, and prioritizing the interests of wealthy donors over the common good. Efforts to reduce the influence of money in politics aim to promote greater transparency, accountability, and fairness in the political process. Addressing the issue of money in politics requires a combination of legal challenges, legislative reforms, grassroots activism, and civic engagement to create a more equitable and democratic political system.

Notes

[1] Donor class from “The Check is in the Mail: Interdistrict Funding Flows in Congressional Elections” by James G. Gimpel, Frances E. Lee, and Shanna Pearson-Merkowitz, in the American Journal of Political Science, April 2008. See also “Democracy and the Donor Class” from Gare Lamarche, the president of the Democracy Alliance. His speech delivered at the Haas Institute for a Fair and Inclusive Society at the University of California, Berkeley on March 7, 2013.
[2] See the report “Breaking Down Barriers: The Faces of Small Donor Public Financing” from the Brennan Center at the New York University School of Law.
[3] Policy capture is an international concern. See the (2017) International Institute for Democracy and Electoral Assistance. extract from: The Global State of Democracy: Exploring Democracy’s Resilience.
Note: Chat GPT was used for parts of this post. Multiple prompts were used, parsed, and verified.

Citation APA (7th Edition)

Pennings, A.J. (2024, Mar 4). The Future of US Democracy: Getting Excessive Money Out of Elections. apennings.com https://apennings.com/political-economy-of-media/the-future-of-us-democracy-getting-money-out-of-elections/

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Anthony J. Pennings, PhD is a Professor at the Department of Technology and Society, State University of New York, Korea teaching broadband and media policy for sustainable development. From 2002-2012 he was on the faculty of New York University where he taught digital economics and information systems management. He has a PhD in Political Science from the University of Hawaii. He lives in Austin, Texas, when not in the Republic of Korea.

Category: crisis communications, democratic political economies, dystopian economies, enabling frameworks, journalism, political economy of media, social media
Tags: Citizens United v. FEC > donor class > Political Action Committees (PACs)

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