The governments of the most powerful countries in the world have failed because they are forced to deal with the extremes of social policy. They are pulled in one direction by the extreme conservatives who want no government influence. They are pulled in the other direction by the extreme liberals who want complete government influence. This has led to extraordinary political conflict which has forced political leaders in the world’s richest countries to advance policies designed to treat the complicated symptoms of problems instead of the root causes of economic, social and environmental challenges.
The tragic result of treating symptoms has been chronic high global unemployment, sub-standard health care, wide-spread illiteracy, uncontrollable crime, global military conflict and environmental decay. It is time for the political leaders in the most influential countries in the world to use the principals of Intelligent Influence® to advance policies designed to address the root-causes of the world’s most significant problems.
Influence Awareness analysis tells us that the two-party system driven by powerful conservatives and liberals has led to a policy focus on short-term solutions designed to achieve temporary political gains instead of long-term improvements. Influence Impact analysis tells us that this approach to government has failed because high unemployment, poor health care, crime, war and poverty continue to be major problems.
Influence Management analysis tells us that every developed country is made up of neighborhoods and communities each with very different populations, characteristics and problems. However, the one factor that determines the relative success or failure of these communities is the percentage of people of working age holding living wage jobs (where an individual makes sufficient money to cover reasonable food, clothing, housing, health care, education and retirement expenses for their household).
I believe that there is an unexplored subset of economics that I call “Neighborhood EconomicsTM” that has not received the focus and attention it deserves. Tip O’Neil, the late Speaker of the US House of Representatives, was famous for saying that “all politics is local.” It is clear that “solutions to global problems are local” as well. History has proven that a “strong” global economy does not mean healthy communities around the world. The only way to effectively solve the most challenging problems in the world is to develop solutions that are custom designed for the unique needs of local communities and neighborhoods. One size does not fit all in politics or social sciences.
Communities with high living wage employment are more likely to have low unemployment, higher literacy rates, better health care, lower crime and less poverty. Consequently, the measure of success of local, state and national government policies should be the extent of living wage employment in a community. I call this Neighborhood CapitalismTM because it is based on free-market economic policies targeting local communities. Most economic theories fail because they are focused on using aggregate economic indicators and applying them to local communities. My theory of Neighborhood Capitalism is more reliable than these theories because it is focused on using local economic indicators as the foundation for assessing the health of the national and global economy.
The one indicator that most accurately measures the success of government policies is the Peace Influence IndexTM (P2I) (which is frequently called the “Caldwell Peace Index”). Every rational human being is striving for peace of mind, peace in their communities and peace in the world. It is therefore essential to have a measure of peace and prosperity that can be applied to communities everywhere.
The equation for P2I is: P = L – G/W where P2I is symbolized by the letter “P” which represents the percentage of “Peace” (and prosperity) in a target area; “L” represents the number of people in “Living Wage Jobs” in the target community; “G” represents the number of people employed in living wage jobs subsidized by 51% or more government funding; and, “W” represents the number of people of “Legal Working Age” in the target community. It is important to note that I subtract living wage jobs subsidized by 51% or more of government funding because these positions rarely serve as the foundation of a community’s long-term financial well-being. They are simply recycling tax dollars in a way that usually does not lead to sustainable economic growth.
Influence Maximization analysis tells us that if every government in the world were evaluated based on this relatively simple equation applied to key large communities they would be influenced to move more rapidly toward peace and prosperity. The beauty of this approach is that it does not matter how neighborhoods are determined geographically as long as the same geographic boundaries are used when identifying P2I trends. Public policies would be focused on providing incentives for large and small businesses and nonprofits/NGOs to hire unemployed workers at living wages. These new government programs would incentivize free market employment in a way that would reduce crime, improve health care, enhance public education and lead to the elimination of terrorism and war.
In a relatively short period of time this measure of free-market prosperity would move the world toward peace by significantly increasing the quality of life for every person on the planet. It is time for average citizens to ask their government leaders for the Peace Influence Index (P2I) trends in the communities where they live and work. This would enable them to measure the success or failure of their political leaders and make more informed political choices on election day.