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Cape Cod Landscape

In August, I attended a five-day leadership course by Meg Wheatley called “Warriors for the Human Spirit”, at the Cape Cod Institute. About 60 of us joined Meg each day from 9:00 to noon for a combination of presentation, discussion, and small group work.

Each day was focused around a certain theme, beginning with the global dynamics impacting leadership today, then recognizing we are a lost culture and thinking about getting ourselves unlost, being clear about the definition of the problem before devising solutions, creating islands of sanity, and preserving and sustaining ourselves. Meg is a masterful teacher—focused and forceful in her message while patient and appreciative of others’ offerings.

I can’t begin to do justice to Meg’s expertise and insight and so have been hesitant to try and distill all I learned into a brief post. I'm also still digesting and exploring what I learned through the course, and I'm in no rush to crystallize things ahead of time. For now, I’ve decided to share three provocative snippets and then describe how I see their relationship to economics, finance and investing.

1. Systems That Are Fundamentally Broken Can’t Be Fixed
We want to change the “system”, but it’s emergent, not mechanical. It has properties and characteristics that are unrelated to the parts that created it, so we can’t go in and fix one part or another and hope to change a system.

Meg suggests the analogy of a chocolate chip cookie. We bake the cookie from a set of discrete ingredients—flour, sugar, butter, salt, chocolate chips. If we discover that the cookies contain too much salt or not enough sugar or they crumble too easily, we can’t fix them. The same is true of complex systems. We have to start over. We are deluding ourselves if we think we can change them.

My Association: Impact Investing
It’s tempting to believe we can have it all—change the system while reaping “market rate” returns. That is the defining ambition of impact investing, and some people actually believe it’s the only way to change the financial system: to beat it at its own game, to prove it’s possible to make more money doing good than bad. To me, trying to turn profit maximizers into kind and compassionate profit maximizers feels like a losing proposition and leaves me dispirited, hopeless, and very frightened about our the future.

What gets me really excited and energized is the multitude of small contrarians who are willing to start over, who are willing to reject profit maximization for a few and consider what’s best for the most. An example in investing would be the RSF Social Finance practice of bringing borrowers and lenders together to mutually agree upon an interest rate that meets the needs of both parties (as much as possible). RSF is not trying to convince Bank of America to change its lending practices. RSF is starting over.

2. Clarity of Purpose Now Is More Important than Being Hopeful
In her own words: "For me personally, as an activist in the world for more than 40 years, I too have struggled with abandoning hope. I have discovered that beyond hope and fear is the place of clear seeing and strengthened commitment to the causes, places and people I champion. Enormous energy becomes available when we replace expectations with clarity. All the energy we put into pumping ourselves up, or denying how difficult it is, or denying that it's not working out the way we wanted it to--all that energy becomes available to us so that we see clearly, and can fully engage our intelligence to work with what is."

We have to get to a place where we do what we do because it’s the right thing to do, because it’s what we absolutely have to do, whether we think we will change the world or not. Meg pretty much dismisses hope and reminds us that the flip side of hope is fear. If we are always moving between hope and fear, we don’t leave room for our good work. She encourages us to find the place beyond hope and fear, where we are in relationship with others at a small, local and personal level. And not because what we’re doing will “scale up” to change the world but because it’s the right thing to do.

My Association: "Scaling Up"
Some impact investing proponents, like many venture capitalists, adopt a mantra that the only worthy investment is a business or enterprise that can “scale up”. It’s one thing to build a business with the clear intention of growing and selling it to the highest bidder. It’s quite another to apply this single-minded agenda to an investment that is intended to affect real people in real places at a scale that is intentionally personal and local. While some impact investors may choose the scale path, this is not necessary or even preferable. Rather than work out of grandiose visions of making a global impact or making something alternative become mainstream, we can find great meaning in doing small things that are right and good and meaningful to us and those we serve.

3. Our Belief in Unending Progress is Delusional
Our distinctly American belief in progress–that life can always get better and better—blinds us to the realities of culture, civilizations, collapse and emergence. We keep trying to fix things and make them better rather than recognizing decline and the need for entirely new systems. We have a sense of being unique, able to conquer anything, but in fact we are not different! We are fully human. We would do well to learn the lessons of the past and of other cultures.

Meg used these examples:
Celts Symbols
Tibetan Symbols
Line Graphs

My Association: Circular Economy
When it comes to economics and finance, we seem to have a cultural aversion to the concept of circles and a major attraction to upward sloping lines. Even though we talk about natural cycles and the cycle of life and death, we seem to shut off that part of our minds when talk turns to money and wealth. Yet there is something beautiful about the concept of a circular economy, one that embraces flows of money and capital as well as production and reuse. When we shift from line to circle in our thinking about the economy (as I discussed in my last blog), everything changes. Urgency and frenetic activity can be replaced with patience and reflection. Working with money and wealth in terms of cycles and flows rather than accumulation and hoarding could indeed be the most impactful contribution we could make to the world at this time.

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