Blackwater & Systems Theory

Erik Prince is working for China's African interests, and James Polous wonders what that means.
Whatever your politics, this is a story about the kinds of perils you can best grasp when you set aside a partisan policy lens and pick up the analytical frameworks offered by systems theory. Consider how the contours of our concern about Prince shift when we think of big government as a systems problem instead of an ideological one. It’s a truism that the bigger a system, the harder it falls.... When a system gets so large that its catastrophic threats become as marginal as possible, the nature of those threats becomes difficult to see, understand, and address....

The systems-theory approach to catastrophic risk is not, of course, free from strong criticism. One of the biggest names in systems theory, Nassim Taleb, has been drawn into the political controversy surrounding the potential systemic risk created by US monetary and fiscal policy. For some, there’s a lot at stake politically in theories potentially predicting that very loose money will provoke a collapse of America’s financial system (and the world’s) — or, at least, a lot of inflation.... Rather than using systems theory as a tool for predicting painful events, we should use it as a heuristic for living what Taleb calls an “antifragile” life. Unlikely as it may at first seem, there’s a real connection between the shocking events that shake a system and our personal exercise of anti-fragile habits.

I could lay out an argument trying to persuade you of this, but I think it’s ultimately more powerful to just point back to Prince. After all, his explicit rationale for his new venture is that the US, as a system, has ceased to be anti-fragile, in both political and cultural terms.
We've talked about Taleb's ideas before. I find them insightful and, generally, persuasive. Here's a place where he makes an analogy to the kinetic:
Although I was not yet familiar with gyms, my idea of knowledge was as follows. People who build their strength using these modern expensive gym machines can lift extremely large weights, show great numbers and develop impressive-looking muscles, but fail to lift a stone; they get completely hammered in a street fight by someone trained in more disorderly settings.... I've debated many economists who claim to specialize in risk and probability: when one takes them slightly outside their narrow focus, but within the discipline of probability, they fall apart, with the disconsolate face of a gym rat in front of a gangster hit man.”
There are anti-fragile ways to train the body and the mind, too. Bicep curls build big biceps, but these five exercises train main strength: the body you build will be less sculpted, but stronger throughout. Yoga builds flexibility, but jujitsu builds flexibility and fighting power. Logic, surprisingly perhaps, is highly fragile. It trains the mind to a fine degree, but strict logic turns out to be inapplicable to almost all of human life. Analogical rather than logical reasoning, rhetoric rather than analytics, this helps you grapple with life.

The American legal environment for business creates a strict and ever-changing set of rules. Many of these rules prevent business formation without great expense. Many of the changes can be existential threats to the business. They can even send you to prison. Blackwater became a political liability -- not even an enemy, just a firm the government didn't want to talk about any more -- and thus a target.

If you wanted to create an environment in which it was wise to set up American businesses for international ventures, you'd deregulate and shrink the bureaucracies that are constantly creating new regulations. You'd reduce the setup costs for a new business, and the danger that the rules might change in destructive ways. Is that what we're doing?

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