"There is now this pervasive
belief in our society that NUMBERS hold all the answers. And so we use numbers to
evaluate options and make our most important decisions.
However, numbers are inherently linear and unbounded, whereas human values are not.
Number-based value systems therefore have no concept of "enough" - more is always better.
As numerical/monetary systems are adopted as increasingly exclusive measures of value, natural
values (such as culture, health, social justice, well-being, biodiversity, etc.) are displaced.
This creates a conflict which has ultimately led to a VALUE CRISIS.
This VALUE CRISIS is at the root of both our Environmental Crisis and our Financial Crisis. What is
needed is a fundamental recognition of non-numeric values at the individual level, and a return to
having human values effectively represented at the group level." - Andrew Welch, author
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The Value Crisis is a timely book that proposes a new way to think
about some of the greatest challenges on the planet. The questions addressed by
the book have a profoundly personal resonance:
Why does it cost so much more to repair things than to replace them?
Why do we seem to have less time, not more?
Why do certain individuals get paid so much money for seemingly doing so little?
Why do we have to consume and throw out so much stuff?
Why are labour disruptions, disliked on both sides, still common throughout society?
Why do we seem to disagree with our own governments and leaders so much?
Why are we not even sure what makes us happy anymore?
The Value Crisis is a unique perspective on the inevitable conflict between
commercial/scientific values (which are entirely number-driven) and human values
(which evolved without numbers). This is not a condemnation of one system or
the other; rather it is a discovery of how their often unacknowledged incompatibilities
affect everything from our personal everyday choices to the global challenges facing
us today. We are forced to think in terms of numbers, but that is clearly not
how our brains are wired.
Human value systems, which have evolved over millennia, make no use of numbers or mathematical
operations. Yet these concepts and operations now play a pivotal role in our personal value
systems. The intersection of values and numbers is money. To understand the history of
money, and how it continues to move further away from the 'real world', is to understand why our
value systems have become more and more distorted and confused.
It is a simple truth that the introduction of money in human interactions will often result in
behaviours and outcomes which run contrary to other established human values. Combine this
with the ever-growing influence of corporations - legal entities that
are exclusively based in monetary value systems - and the result is a Value Crisis.
The book explores human needs and motivation, the power of numbers, and the role of value
systems throughout our society. Through socio-economic models, personal anecdotes, new
theories, and provocative insights, Andrew Welch takes the reader on a thought-provoking and
thoroughly readable journey towards a new comprehension of how we think and act as a species.
"I began this work as a series of reflective essays, exploring Money and Value Systems.
As the writing progressed, more fundamental themes emerged. Humans have a unique ability to
dramatically change their environment through conscious decisions. Decisions are based on
value systems - we make choices based on what we think is best. The Value Crisis
presents the case for the existence of two conflicting value systems that rule our decision-making
- one based on our innate human values, and one based on numbers. It is that conflict,
largely unacknowledged, that gets us into trouble."
Chapter Summary
NUMBERS AND MORE NUMBERS
The work opens with some surprising stories from the history of numbers and how humans and other
animals are wired to work with them. While most believe numeracy to be a fairly strightforward
skill, numbers can fool us in unexpected ways. We are also introduced to the concept of a
value system based on numbers.
Number-based value systems are limitless, linear, and consistent
(across time, space, and culture). Conversely, innate human value systems are bounded,
relative, and inconsistent.
DECISION-MAKING AND NUMBERS
How do we evaluate choices and make decisions? Working from several real-life examples,
this complex process is explored. The mechanics are a bit different for everyone, but when
the results are compared to the objective calculations, some puzzling irrationalities emerge.
Still, some of us often choose to ignore our personal value systems. Why?
Human decision-making, when held against a number-based value system, is flawed. If we
are playing for numbers against anything that has no such innate shortcomings, we will eventually
lose.
MONEY - THE NUMBER CULTURE
An offhand remark about poor travel etiquette kicks off an engrossing exploration of the history
of money, and its impact on society right up to our current age of globalization. The result
is a whole new way to think about the value of money, and how that concept interacts with our other
value systems.
Tangible -> Representative -> Conceptual
Wealth has evolved from something you needed for survival, to something which
might get you what you needed for survival, to a mere belief that you
could get what you needed for survival.
WHAT'S YOUR MOTIVATION?
Building on the pioneering work of Abraham Maslow and Frederick Herzberg, this chapter explores
why we do what we do, and the role money plays. Clearly our human value systems, that have
evolved over millennia, make no use of numbers or mathematical operations. Yet these concepts
and operations now play a pivotal role in our personal value systems.
An increase in wealth will produce a corresponding increase in quality of life.
However, once income exceeds the threshold required to meet certain basic needs, excess quantities
do not produce similarly additional happiness.
WHAT'S YOUR TIME WORTH?
We don't just count our dollars - we also count our minutes and hours. Time is a singular
resource in our society, and much effort is spent translating it into dollars, but are there other
ways to determine a value for time? This section also examines the fairness of compensation
schemes in detail, and proposes alternatives to high labour costs.
Time is a limited resource for a given human, but a virtually unlimited resource for humanity
as a whole. The choice of which interpretation to use has enormous supply and demand
implications.
BANKING ON NUMBERS
To understand the true value of money in the modern age, one must acquire a basic grasp of our
banking system and the concept of debt. The creation of wealth through nothing more than
mathematical operations is also key to understanding the role of numbers in today's value
systems. Most importantly, we look at the growing economy itself, and see what staggeringly
inconceivable numbers have come into play historically when the system goes out of control.
Money used to represent existing value – an IOU for real goods or services. Now
almost all of the money that exists in our economy is created by banks through loans. This
ever-growing pool represents future value that does not yet exist.
NUMBERS INCORPORATED
Publicly-traded corporations present a very unique specimen for an exploration of value
systems. They are independent 'legal persons' that are, by definition and law, exclusively
governed by the principles of a monetary value system. It turns out that this convincingly
explains why their actions are sometimes comdemned as 'evil', although in reality they are only
doing precisely what they are programmed to do. This chapter also unveils an exciting new
proposition for explaining corporate behaviour, using a familiar model.
Publicly-traded business corporations are effectively a separate ‘species’, with
a distinct value system, making independent decisions, and exhibiting characteristic behaviours.
NUMBERING OUR DAYS
Richard Leakey said "We are most certainly the only animal that makes conscious choices that
are bad for our survival as a species". Conscious choices are based on values, and it is
a change at the value level that has created the crisis we currently face. The problems
are not insoluable, but a paradigm shift is required, beginning with an awareness of why we
face these challenges in the first place.
A constantly growing economy is not always the best outcome for society. However, it
is a very addictive one, where we compromise our very survival to get it.
NUMBERS RULE
Democracy is in fact a number-based value system, where the decisions are made solely on
the basis of their polled popularity. New tools now give us more effective and powerful
ways to engage the right people at the right time to arrive at better solutions for a variety
of community and even global challenges. Are we ready for a wikiocracy?
Decisions by majority rule are the best only when the population is sufficiently informed,
smart, interested, engaged, and consulted - all significant assumptions.
VALUE SYSTEMS IN CONFLICT
Building on the work of Robert Reich, this chapter defines three core value personae that
exist in all of us: the Consumer, the Investor, and the Citizen. These values are in
direct conflict, but such conflicts are constantly managed in individuals. It is when
those personae are separately represented at the societal level (by the Marketplace,
Corporations, and Governments) that we see the totally inadequate representation of our
critical Citizen values.
As citizens, we want environmental responsibility and social justice; as
consumers, we want lower prices and more goods; as investors, we want the
economy to grow faster than the population rate, and to have a piece of that action.
