Systemic Thinking in Policy-Making: Key to Economic Sustainability

Introduction

Probably the main characteristic of modern living is concerned with the fact that, as time goes on, more and more social scientists grow increasingly aware that the functioning of human societies is highly systemic. That is, it exemplifies the validity of the main principle of the General Theory of Systems – the whole is greater than the sum of its parts. Therefore, there indeed can be only a few doubts that when it comes to designing social policies, policy-makers should never cease being thoroughly observant of the principle in question, which in turn implies that they should build in an understanding of complex systems into their thinking and planning.

In my paper, I will illustrate the full soundness of this suggestion at length while promoting the idea that the would-be deployed line of argumentation, in this regard, directly relates to the objective of ensuring humanity’s economic self-sustainability. To exemplify the argumentation’s legitimacy, I will discuss how the systemic approach to policy-making can be distinguished from the non-systemic one on both: the municipal and national/international levels.

Body of the paper

Within the context of establishing the main argumentative premise of this paper, we must first identify the rationale for policy-makers to indulge in thinking and planning, in the first place. This task will not prove particularly challenging – the reason why they do it is that they expect that the concerned activity, on their part, will have a number of the long-term beneficial effects on the society’s well-being.

In its turn, this presupposes that policy-makers do possess an understanding of the most fundamental principles behind the society’s functioning – something that puts the concerned individuals in the position of anticipating the would-be effects of a particular policy’s practical implementation well ahead of time. The above-stated presupposes that, in order for policy-makers to be able to prove themselves effective planners, they must be aware of the non-linear nature of the relationship between causes and effects within the society’s systemic framework (Hicklin, O’Toole, & Meier 2008). The logic behind this suggestion is as follows.

Whereas, just about any society (organisation) consists of individuals that are primarily driven by the considerations of self-interest, the interrelationship between these people as the fully integrated society-members, most certainly cannot be described in terms of the so-called ‘jungle law’ – something that would have been the case if the linear logic of people’s behaviour as ‘hairless apes’ defined the manner in which they go about addressing life-challenges on a ‘higher’ (societal) level.

The explanation to this seeming phenomena has to do with the earlier mentioned System Theory, which insists that the process of a particular system (such as human society) becoming progressively more complex, results in the emergence of the qualitatively new patterns of this system’s functioning. These patterns, however, do not directly derive from what used to be the same system’s operative principles, before it has reached a new level of complexity.

One of the main reasons for this is that, as a system grows ever more complex, its overall quality becomes increasingly affected by what happened to be the quality of the interactive relationship between this system’s integral elements, and less influenced by the actual quality of each of these elements (Uphoff & Krishna 2004; Provan & Milward 1995). Thus, one’s ability to indulge in the systemic/synergetic reasoning does positively relate to the measure of the concerned person’s ability to act as an effective policy-maker.

To illustrate the full soundness of this suggestion, we can refer to the currently popular idea (among neo-Liberals) that it would be so much better off for everybody if the system of public transportation in the suburbs/urban areas was to be abandoned altogether – all due to its presumed ‘unfeasibility’. As Rodrigue noted, “Low ridership makes many services financially unsustainable, particularly in suburban areas. In spite of significant subsidies and cross-financing (e.g. tolls) almost every public transit system cannot generate sufficient income to cover its operating and capital costs” (Rodrigue 2016, par. 4).

After all, it does represent a well-known fact that the urban/suburban system of public transportation in Western countries has effectively ceased to serve the purpose of allowing citizens to get from point A to point B en mass – the overwhelming majority of people use cars for this purpose. Instead, it now serves the purpose of making it possible for the governmental officials to claim that they do care about ensuring the well-being of even the most socially unprivileged of these citizens, which in turn comes in very handy for the former during the time of political elections.

However, due to the ongoing economic recession, the maintenance of the system of public transportation fully functional can only be achieved at the expense of lowering investments into the maintenance and development of other (more important) segments of social infrastructure in large cities – something that may hardly add to the extent of these officials’ popularity with ordinary people. Hence, the formally sound line of reasoning, in this regard – if people hardly use buses, why not to abandon the latter altogether and invest the saved funds into the system of public healthcare, for example?

However, once subjected to a systemic inquiry, this line of logic will be exposed utterly fallacious. The rationale behind this suggestion is that those who argue in favour of the public transportation system’s abandonment use a non-systemic approach to identifying the main reason, as to why people are not particularly fond of the idea of using buses to get around.

As some relevant sociological studies indicate, this reason has so much more to do with the long waiting-intervals between subsequent buses than with the fact that the experience of riding a bus can be hardly considered enjoyable, even if thoroughly affordable. If people were to choose between the options of having to spend 20 minutes riding a bus, or having to waste 1-2 hours being stuck in traffic, while trying to get to the same destination in a car, most of them would favour the first option (White, Sepe & Masconale 2014).

And, there is only one way to make it possible – expanding the infrastructure of public transportation to the extent when the mentioned waiting intervals between busses are no longer than 5 minutes. This, in turn, would have proven a much more cost-effective way of addressing the problem of traffic-jams, as compared to building new highways/widening the old ones – something that usually requires the budget of billions of dollars and consequently spawns corruption. Thus, it is indeed thoroughly logical to suggest that when it comes to policy-making even on as low as a municipal level, individuals in charge of the task must be capable of identifying what will account for the non-linear (systemic) consequences of the implementation of a particular policy (Kozhurin 2014).

Essentially the same applies to the process of policy-making on national and international levels. To exemplify the validity of this suggestion, we can refer to the earlier mentioned economic recession (initiated by the crash of the real-estate market in 2008), which appears to affect the economies of Western countries (particularly the U.S.) to an ever greater extent. The main reason why this recession was bound to occur sooner or later is that for the duration of the last few decades, it were namely the adherents of the neo-Liberal/Libertarian economic paradigm, who remained in charge of designing socio-economic policies in the West.

And, as practice indicates, even though the implementation of some of the neo-Liberal economic initiatives may indeed ‘liven up’ the economy for a brief period, the process’s long-term effects are necessarily disastrous. This simply could not be otherwise. The theory of neo-Liberalism/Libertarianism is strongly anti-systemic, in the sense that it refuses to recognise the role of the clearly societal factors on people’s continual ability to enjoy the ‘fruits of civilization’, while proposing that the task of ensuring the continuation of socio-economic progress is the prerogative of what Liberals refer to as the ‘invisible hand of the market’. According to Zafarullah & Huque (2012), “Neoliberalism – or the belief in the sufficiency of markets to secure human welfare – [is] the age’s default ideology. Neoliberalism advances individualism in terms of making choices and taking initiatives, the primacy of the market in laissez faire conditions, minimal state intervention in economic matters” (p. 21).

Because of the mentioned provisions of the ideology of neo-Liberalism, this ideology’s advocates promote the idea that citizens should enjoy an unrestricted personal (economic) freedom; even at the expense of undermining the society’s functional/structural integrity. There is nothing too surprising about it, given the fact that some of the most committed neo-Liberals (such as it used to be Margaret Thatcher) believe that there is no such thing as ‘society’, in the first place. As Thatcher once pointed out in one of her public speeches back in the eighties, “There is no such thing as society. There are individual men and women and there are families. And no governments can do anything except through people, and people must look to themselves first” (Brittan 2013, p. 9).

Apparently, the mentioned ideological approach to policy-making fails to acknowledge the fact that the overall quality of social dynamics within a particular society is so much more than something that merely reflects the current situation with the ‘balance of interests’ among this society’s individual members. The latter would have been the case it is was not up to the fact that, in full accordance with the provisions of the Systems Theory, there is a strongly defined bilateral quality to the relationship between the society, as a whole, and its individual members. That is, just as people contribute to the ‘making’ of the society, the society contributes to the ‘making’ of people.

The fact that this is indeed the case can be illustrated, in regards to a number of empirical observations of how just about any human society functions. For example, in the 18th century Adam Smith noted that the stronger is the factor of ‘division of labour’, within a particular economic system, the higher is the amount of ‘surplus value’, generated by this system’s functioning. Even today, this economic principle remains thoroughly valid, “The growing international division of labour helps to boost world economic performance” (Ukpere 2010).

The produced effect, however, is of the purely societal nature – by increasing the extent of its structural complexity (the ‘division of labour’ helps rather substantially, in this respect), the society is able to reduce the amount of systemic entropy within, which in turn makes it so much more operationally efficient. Thus, it is not only that the notion of ‘society’ is thoroughly objective, but also that the society influences the economy’s workings to a much greater extent than the proponents of neo-Liberalism would like to admit.

If it was not the case, the commercial transactions within the ‘free-market’ economy would be solely defined by the fluctuating ratio between the supply and demand variables. However, it does not take a particularly smart individual to realise that this is far from being the actual case – while indulging in the mentioned transactions, buyers and sellers never cease being influenced by what can be identified as the currently dominant socio-cultural discourse on the planet.

This is the reason why the actual workings of the ‘free-market’ economy often stand in a striking contradiction to the main postulates of economic Liberalism. For example, according to the proponents of neo-Liberalism, the ongoing escalation of political tensions between Iran and Saudi Arabia should have automatically resulted in the dramatic rise of oil-prices. We, however, witness something entirely opposite – these prices continue to hit new lows as we speak.

It is understood, of course, that the above-stated directly relates to the discussed subject matter, because it shows that as of today, policy-makers/politicians do not have any other choice but to design the would-be implemented socio-economic policies in the strongly defined systemic manner. Allegorically speaking, policy-makers must think at least a few steps ahead to what are going to be the non-linear consequences of the proposed social, political and economic initiatives, on the concerned individuals’ part (Room 2011).

This, of course, sheds a certain doubt on the validity of the Western practice of entrusting the task of policy-making to politicians, elected to the legislative bodies by the mean of a popular vote. After all, one’s popularity with voters does not necessarily confirm the person’s ability to think systemically, which in its turn is the main precondition for him or her to prove itself an effective policy-maker. In fact, it is very often the other way around – the earlier reference to Margaret Thatcher confirms the validity of this suggestion perfectly well.

Therefore, there nothing too odd about the fact that the West is now experiencing an acute socio-economic, demographic and cultural crisis, reflected by the decline in living standards in Western countries and by the fact that, as time goes on, these countries lose ever more ground in their geopolitical confrontation with Russia and China/BRICS. This is nothing but the ultimate price for the fact that the process of policy-making in the West continues to be so much more affected by the ideological considerations of political correctness, on the part politicians/governmental officials than by these people’s understanding of the main principles behind the functioning and development of complex systems.

In light of the earlier deployed line of argumentation, as to why it represents a matter of crucial importance for policy-makers to be able to think systemic, and why it is not even optional for them to consider acting otherwise, we can identify the following indications of heightened systemness in the process of a particular would-be implemented policy being designed:

  1. Policy-makers possess a ‘holistic’ (all-encompassing) view of the world, which presupposes the existence of many non-linear links between the integrated elements in a social system. This, in turn, makes it so much more likely for the concerned individuals to ensure that the proposed policies, on their part, are indeed systemically sound and therefore – capable of serving the cause of the society’s overall betterment. The essential part of possessing such a worldview is understanding that the higher levels of a system’s complexity predetermine the exponentially increased complexity of mathematical algorithms, used to describe the qualitative aspects of how this system functions.
  2. While designing a particular policy, legislators prioritise warranting the beneficence of the planned implementation’s long-term effects above everything else. What it means is that the highly systemic policy of a societal importance can hardly be simultaneously both: beneficial to the society’s overall well-being and emotionally appealing to the would-be affected stakeholders. In its turn, a policy-maker’s ability to think ‘long term’ reflects his or her awareness of the fact that it is wrong assessing the varying measure of a socio-political policy’s appropriateness, with respect to whether it can be considered economically feasible or not alone. Partially, this implies that to be systemically sound, such a policy must be ‘socialist’ to an extent.
  3. Policy-makers take into consideration the fact that the very process of a human society continuing to advance, in the economic, technological, and cultural senses of this word, exerts an ever-greater influence on how its members perceive the surrounding reality and their place in it, as well as the purpose of their lives. This reveals yet another limitation of the neo-Liberal approach to policy-making – it never occurred to the ideology’s proponents that there may be any other purpose to one’s existence than to consume products and services 24/7, as something that has the value of a ‘thing in itself’. However, even though many people do appreciate the joys of consumerism, it is specifically the sensation of being in the process of reaching some new heights of personal advancement, which makes them happy more than anything else does. The systemic sounding of this suggestion is quite obvious.

Conclusion

The earlier deployed arguments, in defence of the suggestion that policy-makers should incorporate their understanding of the main operating principles of complex systems as an integral part of the policy-making process, are hardly exhaustive. Nevertheless, I believe that they do correlate with the initially proposed thesis. Moreover, due to being concerned with the ‘real life’ situations, these arguments better than any other help to substantiate the suggestion’s soundness.

Therefore, it will be thoroughly appropriate to conclude this paper by reinstating once again that the very realities of modern living leave policy-makers with no option but to think systemically while on the line of addressing their professional duties. Unfortunately, only a few politicians/top-officials in Western countries seem to be aware of this fact – despite being in the position to design and implement new social-economic policies. This shows once again that the ongoing ‘decline of the West’ is indeed objectively predetermined.

References

Brittan, S 2013, ‘Thatcher was right – there is no such thing as society’, Financial Times [London (UK)], 19 April, p. 9.

Hicklin, A, O’Toole, L & Meier, K 2008, ‘Serpents in the sand: managerial networking and nonlinear influences on organizational performance’, Journal of Public Administration Research & Theory, vol. 18, no. 2, pp. 253-275.

Kozhurin, F 2014, “Systemic Productions of the Most Important Life Activities: Implementation Tools and Pragmatics”, Journal of Business Administration Research, vol. 3, no. 2, pp. 11-27.

Provan, K & Milward, H 1995, ‘A preliminary theory of interorganizational network effectiveness: a comparative study of four community mental health systems’, Administrative Science Quarterly, vol. 40, no. 1, pp. 1-33.

Rodrigue, J 2015. Urban transport challenges, Web.

Room, G 2012, Complexity, institutions and public Policy: agile decision-making in a turbulent world, Edward Elgar Publishing. Cheltenham.

Ukpere, W 2010, ‘Labour exploitation and division of labour: a meta-analysis of divergent ideological perspectives’, African Journal of Business Management, vol. 4, no. 10, pp. 2037-2041.

Uphoff, N & Krishna, A 2004, ‘Civil society and public sector institutions: more than a zero-sum relationship’, Public Administration & Development, vol. 24, no. 4, pp. 357-372.

White, B, Sepe, S & Masconale, S 2014, ‘Urban decay, austerity, and the rule of law’, Emory Law Journal, vol. 64, no. 1, pp. 1-70.

Zafarullah, H & Huque, A 2012, Managing development in a globalized world: concepts, processes, institutions, CRC Press, New York.

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StudyCorgi. 2020. "Systemic Thinking in Policy-Making: Key to Economic Sustainability." October 26, 2020. https://studycorgi.com/policy-making-systemic-thinking-on-various-levels/.

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