America's legacy systems are like stars about to go super-nova
by Charles Hugh-Smith
There are two problems with the vast, sprawling legacy systems we've
inherited from the past: they're dysfunctional and cannot be fixed/reformed. The list of dysfunctional legacy
systems that cannot be truly reformed is long: Social Security, with its
illusory Trust Funds and unsustainable one-to-two ratio of beneficiaries to
full-time workers; Medicare, 40% fraud and ineffective/needless care; the
healthcare system (if you dare even call the mess a system), 40% paper
shuffling and 25% defensive medicine and profiteering; weapons procurement--the
system works great if you like cost overruns and programs that take decades to
actually produce a weapon; higher education--costs have skyrocketed 700% while
studies (Academically Adrift) have found that fully a third of all college
graduates learned little of value in their four years; the financial
system--now that we've given the Federal Reserve oversight over Too Big To Fail
Bank practices, do you really think we'll ever get rid of TBTF banks?
One place to start an investigation of any legacy system is to ask: how
would we design a replacement system from scratch? The gulf between a practical,
efficient replacement system and the broken legacy system is a measure of the
legacy system's dysfunction.
We all know why legacy systems cannot be reformed or replaced: each has
a veritable army of constituents and vested interests. Every single person drawing a check
or payment from the legacy system fears reform of any kind, as each fears that
their place at the feeding trough might be threatened.
As a result, reform is necessarily superficial, a simulacrum of real
reform that satisfies the PR need to "fix the system" but actually
hardens the system against future reform by adding layers of complexity that
act as defensive complexity moats.
There is a fundamental asymmetry between those threatened by reform and
the reformers. The
reformers are trying to save the system from eventual collapse, but the
benefits of their efforts often fall to the cohort of young people who have not
yet become voters or entered the workforce; these citizens don't exist
politically.
Meanwhile, those drawing paychecks, benefits or payments from the legacy
system will fight with every fiber of their being to protect every cent of
"their fair share." (Needless to say, every share is fair and
deserved.) Those resisting reform are fighting to the death, so to speak, while
the reformers have no equivalent motivation or political persuasion.
Corporations threatened by reform launch a ceaseless lobbying/PR attack
on the reform, either watering it down, eviscerating the regulatory structure
or co-opting the reformers into accepting a superficial reform rather than walk
away with nothing.
Legacy systems have hardened into bureaucracies whose primary purpose is
defending the fiefdom's budget and power from any threat. I prepared this chart to illustrate
the life-cycle of bureaucracy:
As revenue flatlines and pressure for real reform mounts, the embattled
institutions find that propaganda and facsimiles of reform are cheaper
"solutions" than real reform. This is the key driver behind the
flood of propaganda and all the phony "reforms" laid out in thousands
of pages of befuddling bureaucratic self-preservation.
Real reform would mean powerful constituencies would have to take real
reductions in staffing, power, benefits and in their share of the national
income. Rather than reveal this double-bind--reform is impossible but the
Status Quo is unsustainable--the legacy system deploys its gargantuan resources
to laying down a smoke-screen of bogus reforms and ginned-up statistics.
America's legacy systems are like stars about to go super-nova. They have increased in size to the
point where their stupendous mass guarantees that once their energy source (as
measured in fossil fuels and money) falls below a certain threshold, the
institution will collapse inward on itself.
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