Sunday, October 26, 2008

Dear Friends, It's the Speculation

I must confess that the original title of this post was, “It's the Speculation, Stupid.” But I thought better of it. To say it that way is a little too cute. The problem is not just that we're all stupid a lot of the time. It's that we're stupid even when we're smart. And that's the flavor of speculation, actually. What may be smart, at least temporarily, for one person becomes stupid if everyone does it. So if we're all stupid, I guess it makes more sense to be friends, friends in our stupidity, but friends the same.

This is my first post where I take the issues of our immediate economic life to hand, rather than stepping back and presenting my ideas on a more general economics of compassion. No doubt I'll say some things that are, well, stupid, but it's a risk I need to take. As deeply as we need a new body of foundational economic theory, we need that theory translated into common sense in the present.

Alan Greenspan testified before a Congressional hearing the other day about the current financial meltdown. As much as I disagree with him fundamentally in so many areas of economic thought, I respect the man. He speaks well, and we can learn from him, especially from the nuanced language he uses. And I respected the fact that he admitted -- now that he's out of power of course -- that he made some mistakes. But the one word he didn't mention (at least in his prepared remarks, which are all I heard) was speculation.

People in the financial world don't like to mention that word to often, but it's the elephant in the living room, isn't it? Part of the problem is that it is often hard to distinguish between what could be called legitimate or even principled investment on the one hand, and speculation on the other. Another problem is that speculation certainly is not the exclusive province of the very rich. If you count homeowners and anyone who has stock investments, or even (indirectly) insurance of any kind, there are a lot of us in the game.

Speculation is something that falls under the general umbrella of what I call the “veil of money.” Money is an absolutely lovely invention, but it has serious flaws because people are, well, human. At the most fundamental level, money is a veil because it puts a linear demarcation of value on things that are inherently qualitative. How much is it really worth not to be hungry? Or to be cured of an illness? For that matter, how much is a clove of garlic really worth? Economists often avoid this issue by saying that something is worth what people are willing and able to pay. But there's still the fundamental problem of quantifying things that are really qualitative. Because of that, and because price really depends on perceived value, which (to put it mildly) can vary, economists have long known that price is not the same thing as actual value. Perhaps this is a gross simplification, but it certainly speaks to the problem of speculation.

In any modern economy, investment is necessary, so what is the difference between a constructive and principled investment and speculation? Simply put, if an asset is purchased merely on the expectation that it will inflate in price, and especially if it is subsequently sold to reap financial profits, it is speculation. In other words, if the whole purpose of an investment is to extract profits based on price inflation of the asset itself, we have a speculative investment. Notice that I'm not equating price and value here. Some investments, say a business that grows over time, do increase in actual value. That sort of increase in value is what stock investors and investment advisors often look for, or at least claim to look for. If the price goes up wildly due to extraneous factors such as “irrational exuberance” or just a bull market, most investors think that is just fine of course. Perhaps we could say, to be fair, that average investors, if there is such a thing, are often taking a strategy in which speculation plays a part, but not the whole part. It is hard, however, to categorize things like currency and commodity trading, and the recent hedge fund craze, as anything but speculation. And the sort of speculation that brought down the house of cards this fall was beyond even ordinary speculation. It was an orgy of extractive market behavior at its worst. It was layer upon layer of questionable debt and esoteric financial instruments (so-called derivatives and the like) being bought, repackaged, sold and resold.

Extractive investment, by the way, is a much broader concept than this sort of financial speculation. The very conduct of a business can be extractive in nature, and often is. Exploitation of natural resources, of labor, and degradation of the environment are all features of extractive business models. Setting those major issues to the side for a time, the practice of rampant speculation in financial investments is the type of extractive behavior that has brought us to the crisis we now face.

It is intuitively obvious that everyone can't make a killing in a speculative economy, but why is that so? In answering that question, we come to a truly fundamental principle, namely the economics of scope.

Most people are familiar with the notion of economics of scale, which means that certain kinds of efficiencies do or don't occur depending on how much of an activity, say manufacturing an item, you do. This is a well defined and well understood principle of economics. What has not been elucidated so clearly is the economics of scope, which I define to mean the behavior of economic action in relation to the whole system in question. Although this may seem to be leading toward rather mystical territory, there is actually a very good example of the economics of scope in classic economics, namely, the monopoly. In the case of monopoly, it does not so much depend on the size of the market in question, but whether one firm effectively controls the entire market. If that is the case, it is called a monopoly and certain very serious problems come up.

Economics of scope as a general principle has huge implications for the sorts of economic problems we face in the present day world. It is, in fact, a useful umbrella concept for the crucial issues of our times: the environment, social justice, even economic war vs. peace. What we find with economics of scope is that inevitably our activity takes place in some kind of larger context, some kind of system. As we push to the edge of system scope (i.e. as our actions come to affect the whole system) , certain non-linear effects come about. Economics of scope is itself a subset of the more general principle of co-centricity outlined in my earlier posts. The notion of pushing the boundaries of system scope is a little difficult to explain. The closest analogy I can make is in comparison to relativity theory, where it is said that as a physical object approaches the speed of light, its mass starts to increase wildly. In our everyday world, we would expect changes of speed of an object to have no effect at all on its mass. And that is more or less what we observe. But approaching the speed of light is some sort of fundamental system boundary of the physical universe. Different stuff happens on the edges of systems. And so it is with economic, ecological, and social systems, in so many ways.

Classic macroeconomics actually addresses the issue of economics of scope, though I don't know that the term has ever been used before in this way. In Keynesian macroeconomics, the central government attempts to use its powers of spending and taxation to impact trends in the overall economy of a nation. The problem in today's world of course it that we have a global economy. (I'm not implying that the lack of global government is a problem; I'm just saying that Keynesian macroeconomics can't be practiced on a global scale, though Keynes himself of course was instrumental in building some of the international economic institutions that try to operate at the global level.) All this is not to mention the fact that Keynesian macroeconomics never worked all that well anyway, even when it is not, as it has been in recent times, grossly distorted by political incompetence and hypocrisy.

But I digress. The point to made from the perspective of economics of scope is this: if an insignificant proportion of economic actors in an economy engage in speculative behavior, it is more or less insignificant. They may incur some sort of moral failings on an individual basis, but the overall economy will not be effected. But when everybody or close to everybody is involved with, or exposed to, speculative risk, it simply does not work out. When your whole banking system is sucked into wild speculative investments on “securitized” (a very ironic term) mortgages for real estate that was itself involved in a wild and unsustainable spiral of price inflation, mortgages for which “we did not correctly price the risk,” (to paraphrase Greenspan's quaintly understated admission of failure) you have a whole economy falling into a vortex of illusion. It's the pervasiveness of the speculation that collapsed the house of cards, and that's a good example of economics of scope. It is a system-scope level of failure.

I don't believe I've said anything truly original about the crisis here, but at least it's an opportunity to introduce the key concept of economics of scope. And by looking at what is truly a toxic and corrosive style of investment, we may be able to move toward a glimpse of the characteristics of a healthy investment paradigm.

For more on the roots of the current crisis, see this very informative (and not too long) article about the current crisis by Herman Daly.

(If you don't know who Herman Daly is, he's worth studying, to say the least.)

And for an article on the recent Greenspan testimony that's a lot harder on him than I was above, but with which I fundamentally agree, see this David Corn piece from Mother Jones.

Tuesday, October 7, 2008

The Six-Fold Economics of Compassion

Is it possible to build an economic theory based on compassion? From a Buddhist point of view, the answer would be yes, especially because compassion is considered to be inseparable from wisdom. If we were to ask the same question about wisdom, i.e., “Is it possible to build an economic theory based on wisdom?” the answer would be, “Of course.” In fact, if we didn't build it on wisdom, it would simply be invalid. Well then, if wisdom and compassion are inseparable, it looks like compassion is a valid basis for our theory. This is obviously not meant to be an exhaustive justification of an economics of compassion. Sometimes raising questions is enough. What does it really mean that compassion is inseparable from wisdom? If that is true, what implications does it have for our ordinary understanding of compassion? And what does it really mean to develop an economics of compassion?

The classic definition of compassion is the wish to relieve a being or beings of their suffering. It is the thought that, “May they be free from suffering.” In many ways, this simple definition is enough for all that will follow, but I would like to use a slightly more elaborate definition, one that is a summation of what is known in Mahayana Buddhism as The Four Immeasurables. The first of these is the aspiration that all beings without exception may have happiness. And interestingly enough, the Tibetan prayer that makes these aspirations adds "and the causes of happiness." The second is that beings may have freedom from suffering and its causes. The third is that beings have the higher forms of joy associated with the spiritual path, and finally may they have the profound equanimity associated with wisdom. This is a very simplified explanation of the Four Immeasurables, but it adds depth to the simpler notion of compassion as aspiring that others have mere freedom from suffering. These four facets of aspiration are called immeasurable, by the way, because they apply to all beings, and because they are immeasurable in depth and profundity even for one being. Thus you could say they are “immeasurable to the immeasurable power.” I use this more elaborate definition of compassion because it support the full range of human aspiration. It works well with a post-materialist viewpoint of human culture, one of going beyond mere material sufficiency to areas such as learning, the arts, creativity, and spirituality.

Generating compassion in an unbiased way, which means having an impartial outlook towards all beings, can be seen as an essential expression of the co-centric wisdom, the wisdom that includes all, and excludes nothing. Much more can and should be said about unbiased compassion in an economic context. Often, of course, in our economic behavior human beings display great kindness for people we are close too, especially family members or members of a larger social unit or country. But often the reverse is true for people we regard as “other.” We often treat such people with at best indifference, or quite often with varying degrees of exploitation and downright cruelty.

The ability to be fully inclusive, to think in terms of humanity as a whole, as well as to regard each individual impartially, is part of the wisdom potential we all possess. This is not to say that everyone holds such an attitude, of course. Nevertheless, it is entirely possible for any one of us to do so.

An important point I'd like to raise here is that this body of writing (my blog and my upcoming book) is not an attempt to talk people into having compassion. Of course, I do advocate compassion. I hope people will develop it, maintain it, and increase it. It's just that I feel I would be talking down to people if I felt I had to push it on them. The reality is that compassion is inherent to our human minds. It is not a religious attitude, and it is not imposed by law or even custom, though of course social influence is important. But the bottom line is that this body of theory is most fundamentally about how to apply the compassion we already have to economics. I am still working on my own compassion, and I'm not a spiritual teacher. There are plenty of sources available to learn about compassion, far better ones than myself.

And of course there have been many attempts to apply compassion to economics in history. The original ideas behind socialism and the free enterprise system both contained elements of social compassion, though from different angles. The older idea of the “benevolent despot” is another form of compassion in economics, and the more recent concept of the welfare state derives from such a outlook. Even Keynsian macroeconomics, which boils down to rather abstract government actions around fiscal and monetary policies, carries this intention, since in theory it tries to make the economy better for everyone.

I will have much more to say about all of the above in the future, but the task at hand is to put forth a very general economics of compassion. In fact, the “General Economics of Compassion” was the original title for this part of my theory. But as I developed an explanation which uses the six paramitas of mahayana Buddhism as a framework, “The Six-Fold Economics of Compassion” seemed to be a much nicer title, so I'm going with that. However, note that what follows is a general description, one that doesn't make practical recommendations of a specific nature for the present day world. The special proposals that are at the heart of my pragmatic economic ideas will come somewhat later.

Let's say we have a general attitude of compassion, one that is intended to be unbiased. In some ways it may be easier to think in terms of “humanity as a whole” rather than caring for each individual, but really it is the same thing. And we are ourselves each part of humanity's whole, of course. In fact, as we explore the co-centric wisdom further, we will increasingly see that our individual fate, and hence our individual interest, is utterly tied up with “humanity as a whole.” We could say with real certainty at this point in history that a very significant part of each of our individual economic interests is the interest of the human whole. And conversely of course, the interest of the human whole affects every individual. This fact is extremely important in the considerations behind my special proposal, but for now we can view it as merely a reminder that compassion isn't entirely altruism, in the sense that it isn't entirely negligent of one's own interest. Still, generating unbiased compassion is a stretch, and it is something that should be contemplated rigorously. That's as far as I'll go in terms of advocating compassion. Let's contemplate it. If it works, let's put it into practice. And by the way, my practical theories to come don't depend on everyone having compassion, nor do they necessitate imposing compassionate behavior on people. That will not be necessary, and indeed it is not possible.

For the sake of discussion, let's assume there are some people who do want to practice an economics of compassion. Let's say there's at least one. Or maybe two: you and me. How do we go about it?

Mahayana Buddhism provides us with a set of six perfections (paramitas) which are the means of completing the much larger task of bringing all beings to spiritual enlightenment. They can be directly applied to positive economic behavior in the following ways: Generosity, Ethical Discipline, Tolerance, Diligence, Focusing, and Wisdom. These six economic virtues are named almost identically to the translations of the names of the paramitas from Sanskrit and Tibetan, with something of an exception on the fifth, so I will discuss that briefly first, then cover them in order.

Among the mahayana paramitas, the fifth is called dhyana (Sanskrit), samten (Tibetan) and meditation or concentration in English. Samten in Tibetan is literally “stable thought” which has the meaning of “stable mind.” It applies to the practice of training one's mind at a basic level. It involves focusing the mind (concentration) but also taming the mind to reduce the influence of negative psychological patterns (kleshas). All meditation practice in Buddhism is said to fall into the categories of shamata and vipasyana, and this fifth paramita pertains to the shamata aspect of meditation. Strictly speaking, it is not entirely accurate to say samten refers to meditation, because meditation also includes vipasyana, which pertains to the sixth perfection of wisdom or prajna. (Some accounts of Buddhist meditation, however, catagorize both shamata and vipashyana in the sense of their being practices, under the 5th paramita, and use the sixth paramita to refer purely to wisdom itself.) In any case, the economic virtue of focusing carries many of the same implications that the focusing aspect of basic meditation practice does in the Buddhist path, but applied to economic behavior.

Focusing as an economic virtue could also be called “focal application” or “appropriate focus.” In most general terms it means having the mental presence and direction that enables us to do anything properly. It is the natural focus of work, of study and learning, of planning and reflection, and all the work of the mind that pertains to economic thought. Without focus our minds are ruled by confusion and we will never see things clearly or get anything done.


With generosity, we find a starting point that is quite easy to understand, and it seems to pertain directly to economics. The only problem is that economists have generally not found a comfortable way to incorporate generosity into their theories at all. There is evidence that some of the early theorists of economics were frankly baffled by the concept, or specifically by the tendency of people to simply give things away. They could not reconcile the notion of an exchange economy with basic kindness. It didn't add up. Later thinkers of the socialist ilk, including those of the “weeping” variety, have tended to see economic inclusion as a political right, not as something that is particularly to be achieved by generosity.

And then there is the whole messy question of non-monetized transactions. Hazel Henderson has famously pointed out the “love economy” as practiced most notably by wives and mothers throughout history, and the importance thereof. The fact that such a vast amount of economic benefit is simply given away by unpaid or underpaid workers makes it very hard for economists. They like nice neat things that have numbers attached to them so they can put them into equations. Suffice to say that the significance of generosity at the family level has been underreported.

In any case, if we start with individual economic behavior, not broader theory, it is clear that generosity is a clear and valid way to practice the economics of compassion. In fact, without the generosity of parents to children in particular, and people to their close relations in general, human society as we know it would simply not exist. Although such generosity does carry with it the attachment (and obligation) that goes with such relationships, the fact is that is most typically also an expression of love and commitment. It's part of the “love that makes the world go 'round.” The fact that generosity of this sort is so pervasive, so ubiquitous, and so natural demands that we acknowledge it in our economic thinking. It also points to deeper possibilities of generosity as we (at least some of us) come to acknowledge the inclusive unity of the global human family.

Another aspect of material generosity is that of charity and philanthropy. Again, these areas of economic activity play a huge role in human society -- and increasingly so. People give so much, in so many ways, to people they don't know at all, and for so little (or no) return or recognition, that it is simply amazing. Although there are many shortcomings to charity and philanthropy, including the general criticism that it merely tends to perpetuate the existing system of haves and have nots, we still need to recognize that, in some measure, this type of economics of compassion has existed for a very long time. Whether human generosity can be further mobilized to decisively address critical global problems is one of the great questions of our time. The question is not just whether it can be mobilized, or how, but most pointedly, how can the natural generosity of humanity be utilized to transform the economic landscape?

Another dimension of material generosity is one not normally associated with generosity at all, namely conservation. If you think about it, what is the implication of not wasting resources? First of all, you save money. But beyond that, that resource is available for someone else. Simple as that. So, we could view conservation as an expression of generosity.

Conservation in its environmental implications also relates to another major category mentioned in traditional Buddhist accounts of generosity, namely the “generosity of protection.” Clearly if you protect someone from harm in some way, you have given them a great gift, perhaps the gift of life itself. The relevance of this to our contemporary economic activity is this: environmentally positive behavior is a form of generosity. Although this may seem to be just another way of talking about it, I think it is of significance. Any environmentalist knows of the great challenge of shifting human behavior (whether as individuals or in organizations) toward more positive environmental actions. Often there is a lot of guilt and blame attached to the old wasteful and destructive ways of doing things, and a lot of authoritarian righteousness associated with it all. Often the level of compliance and the willingness to change is rather shallow. We need new ways of encouraging each other to behave more in harmony with the planet and with a future that isn't going to be a total disaster. Framing the protection of humanity from environmental harm as a form of generosity is a positive way of approaching this, and it brings out the natural human heroism that we're all capable of.

The third category of generosity can be called the “generosity of truth.” It is actually generous to study, to contemplate, to look for answers, and to communicate those answers. It is generous to courageously proclaim the sorts of “inconvenient truths” we all need to hear. Again, this is another way of framing actions that we who are progressive minded already accept and honor. But again, if we see this in a new way, we may find new strength to practice this form of generosity. Often there is a strong flavor of criticism and anger in our proclamation of truth. Certainly there is blame enough to go around, but seeing the communication of truth as a form of generosity makes it more likely that we will temper it with understanding and kindness -- and maybe we will actually be heard. Maybe something will get done.

Ethical Discipline

Ethics and morality are of course deeply intertwined with economic behavior throughout history. If you study the subject economic history, you will see fascinating shifts in what has been considered ethical or moral. For example, in the Europe's Middle Ages, making a profit “for it's own sake” was deemed immoral and in fact illegal by the Catholic Church. Some cultures to this day regard usury (lending money at interest) as immoral. Then there are certain basic principles that can be regarded as universal, across cultures and history, such as the injunction against stealing.

In any case, what this discussion may contribute to this vast body of thought may just be a few significant points of emphasis. The first is simply a consideration of why we might want to practice ethical conduct. To practice ethical conduct out of compassion is a refreshing shift of emphasis from the heavy shroud of legalistic moralism surrounding the subject. Typically there is an emphasis on morality/immorality in terms of its consequences, whether they be legal or other-worldly repercussions, or spiritual outcomes, from whatever point of view you have. The eastern traditions emphasize the inevitable law of karma, which follows us independent of human retribution or even divine judgment. To avoid negative ethical or moral actions out of concern for their impact on one's own future is entirely justified. But even more powerful and profound is to do so out of compassion for others. And in some sense it is more natural too. You don't steal because you don't want to deprive someone of something that is theirs, not because you may get caught or suffer from bad karma in future lives. It is direct and simple. Although ethics can be quite complicated, compassion will usually steer us in the right direction.

Buddhism talks about morality in terms of avoiding negative actions and adopting positive ones. In economic terms, it is clear that some things to avoid would be stealing, deception, fraud, manipulation, cruelty, and exploitation. On the positive side we can enact ethical discipline by practicing fairness, honesty, and kindness in economic dealings.

Another dimension of ethics could be called the “morality of post-materialism.” Al Gore has made the well-known point that global warming is not a political issue, but rather a moral one. The kinds of actions that will enable us to stop global warming are indeed moral in their scope. To paraphrase another famous quote, we can't cure global warming “with the same mentality that is creating it.” There needs to be some sort of fundamental critique of materialism and realignment of values. The possibility of relaxing our obsessive drive for material consumption and convenience is a prerequisite for changing our economic way of life and gradually putting human values and human wellbeing first. That is the morality of post-materialism.
This leads directly to a last point, which can be called “the special morality of planetary-scope compassion.” We are at a point in history where some of us, at least, can see the possibility of human citizenship at a planetary level. There are many actions we can take in expression of that, some of them very simple. Just about any action that reduces environmental harm is actually an act of planetary citizenship, or planetary compassion. And there are many many other specific actions we can take at this level of ethical conduct. It is mentioned as a separate point because the co-centric approach emphasizes whole systems. Human society in the global ecosystem is one such whole system. To contemplate how to take compassionate action in relation to this whole system is a very high level of ethical engagement.


The third paramita is often translated as patience, but its essential meaning is actually closer to tolerance. Just as ethics are presented as a remedy for negative actions in general, tolerance is presented as the remedy for anger. It is probably not necessary to go to great length in discussing the tremendous dangers and suffering that anger and hatred bring to humanity. The world stage and the “news cycle” give us plenty of examples every day. The play of anger and aversion in economics may be a bit more subtle, but it is extraordinarily corrosive in effect. And tolerance in economic life can be correspondingly incredibly healing and transformative. In particular, tolerance can temper the negative effects of competition. There is a vast difference between pure economic competition in a free economy and the sort of competition that takes place in war--or even sports. Competition at a psychological level carries with it a great deal of anger and jealousy. It is destructive. It should be a no-brainer that cooperation is better than competition, or that economic competition should be fair and respectful. The reason cooperation and fair competition are so hard to achieve is that human beings carry a great deal of negativity towards those we perceive as “other.” We are fine with getting something at someone else's expense, especially when it pertains to our livelihood. On the other hand, there is a growing realization amongst at least some human beings, that there ultimately is no “other.” We're all in this together. Despite this growing awareness, non-aggression is a tough one. Those of us who seek justice and environmental sanity often develop a great deal of anger towards those who don't. And if we don't get angry, how are we going to motivate ourselves to change things?

These are hard questions, and I'm not going to patronize my readers with simple answers. However, it is possible to envision and create economic systems that don't emphasize harmful competition, and do emphasize cooperation. Generally speaking, it is rather radical to mention the notion of non-aggression in an economic context in today's world. It seems like a foreign concept. Probably it brings up the thought that if “we” behave with non-aggression, “they” will take advantage of us. There is a tremendous amount of thought and discussion that can and should go into this question of economic non-aggression. If appropriate ways of enacting non-aggression can be implemented, they could represent a potentially key turning point in economic history.


When we talk about diligence or exertion as an economic virtue, it does not mean simply working hard. It means applying hard work and perseverance in the context of truly positive and skillful ways of working, ways that benefit others and avoid harm. In fact, it can take a lot of work just to find modes of livelihood that are not harmful. A great deal of research is going on these days, for example, into how to do all manner of industrial processes in ways that don't harm the environment. That is a good example of proper exertion. Improper diligence, of course, happens all the time. People work tremendously hard to strip the world of its resources, to exploit the work of others, even to steal. In the movie “Heat,” Robert DeNiro plays a master criminal who works with great skill and meticulous planning and discipline. That's a fine example of the opposite of what is meant here by diligence. Unfortunately all such examples are not fictional. And it is interesting that so often the people who have good intentions for the world, gentleness, and ethics, somehow don't work as hard as the crooks. For better or worse, quite literally, it takes diligence to get something done.


We have looked at focus a bit earlier, and now we will look at in more detail in the economic context. The first point to be made here is that focus is the practice of disciplining the mind to promote stability of mind and attention as a basis for economic integrity in work, consumer behavior, and business behavior.

Integrity of work is perhaps the simplest to understand: to get something done, we have to focus on it. That is an ongoing requirement. Normally we don't think of “doing the job right” to be an act of compassion, but in reality it usually is. Think about the people who drive buses and trains, or fly planes. Think about medical people, teachers, financial professionals. In fact, all kinds of work affect others. Doing a good job in many cases can be a matter of life and death. Proper focus and attention are required to do the job right.

In consumer behavior, it is interesting to note that having a focused and trained mind will help avoid being swayed and influenced by advertising and marketing messages of all kinds, including peer pressure. It presents the possibility of being centered in one's buying behavior. The old fashioned term for this is being “sensible.” Being sensible in today's world doesn't always mean buying the cheaper product. It may mean not buying something at all, or buying a more expensive product that's better for humanity. Having the judgment and character to make such decisions requires a stable mind. A stable mind comes from focusing.

In business behavior, the main point to be noted is that focus brings about the penetration necessary to make correct decisions. By correct decisions I mean responsible decisions. And in the context of the economics of compassion, a responsible decision is one that is responsible to all humanity. That's a tall order, of course, but without the appropriate mental focus, we wouldn't have a chance to make such decisions. We wouldn't even have the ability to make correct decisions, say for our own business in the short term.

An even broader application of focus is in the general mind training needed for stabilizing compassion altogether. I use the term mind training intentionally here, because there is a mahayana system that has been passed down through the Tibetan tradition called lojong, which quite literally means “mind training.” Its emphasis is on making the attitude of compassion for all beings one of stable focus and commitment. This tradition is present in all the major lineages of Tibetan Buddhism, and has been championed by the great teachers of that tradition in present times. The importance given to turning compassion into a genuine discipline points out the importance of really establishing such an attitude in an unshakable way. Usually we have compassion that is limited in several ways. As mentioned above, we usually have compassion for people we like. According to Buddhism this may not be compassion at all -- or if it is, it is compassion mixed with attachment. The defect of this is that we are biased, and our minds easily switch over to total cruelty towards those we dislike. The other problem is that our compassion is sporadic. Sometimes we think very kind thoughts and try to do nice things, but just as often we behave with more or less total self absorption. Having a stable outlook of compassion does not mean living a life of martyrdom or ascetic sainthood, but it does mean finding some consistency in attitude and behavior. It means remembering compassion when things get complicated. All this comes from making compassion an object of focus, and training on that. By doing so, it eventually becomes thoroughly familiar. It becomes part of our very character.

Finally, we can discuss mental focus in terms of its being a condition for generating insight and wisdom concerning economics. The fact is that economics is a complex subject and presents a vast array of conceptual information, much of it confusing and much of it contradictory. Certainly the main schools of economics that have come down to us in the European tradition are seriously contradictory and indeed in serious conflict. We may be in an era of history in which the “free market” system seems to have won the conflict with socialism/communism, but that appearance may itself mask a deeper fragmentation of actual theory and practice. And the evident defects and potentially catastrophic flaws of a market system are glaringly obvious at this point in history, despite the ascendancy of the system itself. And in practice, the complexities of a globalized economy in crisis require a clarity that doesn't just come from more information or from following the opinions of so-called experts. Those who will provide real leadership in economics are not only going to be the professors (learned as they are) or the think tank pundits of C-span (often with very real ideological conflicts of interest), or the hired hand economists of investment banks and brokerage firms. Much has been said of the failure of economics as a profession. In many ways it is unfair to blame economists for the state of the world economy today, but at the same time it is reasonable to ask that those who study and profess to knowledge about the subject evolve in their insight and capacity to help humanity. Ordinary people are going to need to understand economics too, perhaps just to survive. Bringing a strong focused mind endowed with compassion to the subject of economics is a great service to humanity. Through such a focus, we will come to develop economic wisdom, which in my earlier posts I have described as post-materialism and co-centricity. Recently it has occurred to me that perhaps a better term for the second aspect of wisdom is “co-abiding.” I will explore this in future posts, but for the purpose of a brief explanation of the six-fold economics of compassion, these earlier posts will cover the topic of the sixth virtue, wisdom.