Archive for the ‘society’ Category

Are Older Workers Marginalized in the Workplace?

10/30/2012

Lorrie Clark of the Permanent Search Group in Toronto, Ontario, Canada started a dialogue in the Canada Jobs, Careers and Networking, a subgroup of Job Openings, Job Leads and Job Connections!  group on Linked In.

Are Older Workers Marginalized in the Workplace?

Do you think that aging workers become less valued and even marginalized in the workplace as they grow older?

The thoughtful comments there got me thinking. Here is my point of view of the underlying dynamics leading to this.

Funny how things changes as the years accumulate. When I was in my 20’s, 30’s, 40’s, and 50’s, I never really thought about hiring folks who were older. I just hired the folks that fit the jobs I needed filled – and generally age reflected required experience.

As I gained experience, and moved into more senior positions, I tended to hire folks who were the same age or folks who were younger than I was.

Because I moved into senior ranks (CIO level) in my early thirties, I also often hired folks who were older than me – but even then I realized that this was not the usual pattern in the companies in which I worked. People tend to hire folks who are the same age or younger. Most folks are just not comfortable hiring folks who are the same age as their parents.

Then I entered my late 50’s and 60’s. Suddenly, head hunter acquaintances were politely telling me that I was a “hard sell”. The socially polite ones used the words “too experienced”. But a few of them were a little more straight  with me. Here is the kind of thing I heard from them.

“Can’t place folks pass 55 in most of my assignments – people want the appearance of youthful energy – even when it is an illusion. The other reality is that folks don’t tend to hire people that are older than they are. It’s is the exception, rather than the rule. Most of my clients – the folks who make the hiring decisions – are in their late 40s, early 50’s and they hire folks who are younger than they are.”

So I believe that things have not changed all that much in the past 50 years or so on the hiring side.

But things have sure changed on the demographic side, and on the economic side. There are more folks who are healthy and wanting to do productive work who are in their late 50’s, 60’s and 70’s than ever before. And there is a talent crisis coming, as well as continuing economic turbulence. This in and off itself is not enough to produce real change in the hiring marketplace. Things won’t change however till companies, and even more importantly, politicians, do three things.

1. Companies need to stop expecting HR recruiters in their 30’s and 40’s to present candidates who are older than the HR recruiters to hiring managers. Put some recruiters in their late 50’s and 60’s into the recruiting department if you want to see that change.

2. Companies need to stop the hiring myth that we as a company are hiring you for the rest of your career. The employment marketplace and social stats are clear. People will work for a number of companies and have a number of careers in the 21st century. Problem is most companies’ pension plans, even if they have made the move from defined benefit to pay out what your plan is worth, are still structured on the 20th century expectation that you will work  for this company for most of your career.

Cut pensions loose from companies, make them portable, belonging to the individual. Let’s see serious tax and legal frameworks that encourage companies to do that. Politicians take note please.

3. Create a job market place which encourages and supports “interim” or contract assignments which are strongly differentiated from full time or career assignments.

Again this will not happen until appropriate legal and tax framework changes are in place. For one thing, individuals working in this “contract” marketplace need things like income averaging to help manage the risks involved. They also need a simpler “business expense” framework than the one which works for companies / corporations.

But, personal opinion – given the mess that politicians have gotten into by running up big deficits – we are not likely to see this kind of forward thinking from most of them. On my more morbid days, I sometimes think that democracy is a con game in which politicians buy votes with a voter’s neighbor’s (who can vote) and voters’ kids (because government deficit financing of current programs ==> future taxation of people who cannot vote) dollars.

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Four Core Things I Believe About Life in Organizations

04/04/2012

I learned something important about myself on the weekend. I am less patient with myself now and much less accepting of some of the things others in my society believe about life in organizations. I don’t expect to be seen as being any more “right” in my views now than in my earlier years. I don’t expect folks in general to agree with me any more than they did in the past – that is up to them. But I do find that I am not prepared to engage in as much dialogue about these beliefs with those who see things differently, unless that dialogue leads to real constructive action that benefits both of us.

I have worked for a long time. Over the course of my career, I have kept up a constant involvement in academic life – as a night student, graduate student, part time lecturer and distance education participant. I have and still read widely in management and workplace psychology. I have thought hard about what I was doing at work and how I was leading the folks who worked for me.

I have come to these four conclusions by reflecting on both the reading and the experience. I have quietly held them for years. They underlie all my consulting work and business related writing.

1. Performance appraisal is a waste of time if you are looking for business results.

Our evolved instinctive approaches to living in tribes makes power based interpersonal relationships vey much part of the way that we work together. We like tribally defined hierarchies. We need leaders and followers. We need to know where we stand in these tribal power structures. Performance appraisal does a fine job of addressing these needs. But it does nothing at all to increase an organization’s ability to generate results.

I have personally appraised dozens of direct reports. I have directed the building of innovative computer based performance appraisal systems. I have led the implementation of such performance appraisal systems in large large IT organizations (> 1500 professionals).

But I now accept very little of my work around performance appraisal contributed to improving the results we delivered in the organizations for which I worked. I now know that backward looking performance appraisal simply does not justify the energy it takes to do and the anxiety and mistrust that it creates in the people who were appraised.

Forward looking performance contracting is different. Performance contracting means looking ahead, not looking back. It consists of:

  1. negotiating what an individual will do in the coming months and year,
  2. clarifying how this relates to what others, including the person whom the individual is dependent on, are doing,
  3. agreeing on how the to be delivered by the individual are going to be measured  by both the person and the boss (i.e. they each need independent access to the data that makes up the measures);
  4. and then getting together regularly to review delivered personal results against the agreed upon performance objectives.

Managers who do performance contract in this way lead at work. They inspire. They shape the future through the actions of the people who work for them.

It worked for me. I have twice created IT organizations that outside auditors independently judged to be “world class excellent”. In both organizations, I did performance contracting with my direct reports, and encouraged them to do so with the people who worked for them. Together, we supported the cascade of this approach down our organization.

Performance contracting is not easy. The boss must make a personal commitment to simultaneously treating the people who work for the boss as problem solving peers and as results-responsible direct reports. Doing so involves accepting and working with the dynamic contradictions between these two roles. As power solving peers, the two people share power and a kind of equality. As direct report and boss, they are in a clearly defined power hierarchy. Recognizing and respecting these differences, and dealing with the conflict they create, takes self awareness and self containment on the part of the boss.

Bosses must discipline themselves to continuously clarify when they are behaving as a problem solving peer and when they are behaving as a results evaluating superior.

At times, bosses must negate the “power surge” that comes from being a results evaluating superior so they can effectively coach as a problem solving peer They must resist the temptation to use the power component of the relationship to simply dictate the solutions to problems when the two of them engage as problem solving peers. They must accept that simply telling does not always lead to understanding on the part of the direct report. They must act as if this is the boss’s failure, not the direct report’s, when this occurs.

At other times, particularly at the end of the performance period, bosses must take on the tough challenge of carrying though on negative consequences when the direct report’s performance has been lacking. This is not easy if the boss has developed a “liking” for the person through working with the individual as a problem solving peer. It will be even harder if the boss has failed to coach effectively in the regular review meetings between the two.

Human beings’ instinctive approach to managing performance in organizations – power based performance appraisal – is much easier, especially on bosses. It just does not motivate the folks who are appraised to produce “above every day” or excellent results.

2. Organizations waste the dollars they spend on interpersonal skill training (e.g. programs on leading others, resolving conflict …).

If behavior on the job does not change as a result of training, the money spent on it is wasted.

Very little interpersonal behavior training leads changes on the job, despite the millions of dollars spent on managerial, supervisory and interpersonal skills training. Every one “kind of” knows this. That is why there is so few systematic follow up programs to measure actual “on the job” behavior after such training programs. As long as we don’t have to face the facts, we can continue to believe.

There are two reasons why behavior change back on the job after participating in interpersonal skill type of training program is so hard.

1. Unless individuals are personally motivated, they are not going to change their behavior back at work (or in their personal lives), even it they learn the underlying ideas and concepts.

Self selection and self initiation of participation in such training is a good indicator of the needed motivation. Personally enrolling oneself in this type of course is a good predictor that the individual might have the needed motivation needed to actually change behavior back on the job. Expending personal resources to pay for the training is an even better one.

Being “sent” on such program by your organization has very little to do with having the level of personal motivation needed to actually change behavior on the job. Yet many organizations ask people to attend such training programs because the “boss” thinks it is a good thing, or because it is the norm for all people who first enter a certain job level, or because some executive has come to believe that this type of training has pay back.

2. Individuals behave in interlocked patterns at work. If one person changes his or her interpersonal behavior, the others the person interacts with have to change theirs as well. These other people are often not motivated to do so. Instead, they put group peer pressure on the person who changes his or her behavior after attending a training program to revert back to the old behaviors the person had before they went on the training program – the social extinction effect. Most individuals who try to implement new behaviors do revert back to the old behaviors in the face of this implicit social pressure. The training investment is lost.

The individuals who persist in wanting to change their behavior after such training often respond to the peer pressure by finding new people to work with. Usually, this means moving to a new job. Often, that new job is with another employer. The training investment is lost.

Organizations who want to really change interpersonal behavior patterns need to engage in systematic culture change programs. As well as training, such programs involve visible recognition and compensation programs that reward the “new behavior”. These programs also involve specific activities that counter “resistance” to change on the part of current members of the culture.

Such programs are difficult to plan and to execute. They must work from the top down and the bottom up in a coordinated way. They are intensely resource demanding. They require persistence over extended periods of time. Few organizations succeed at such culture change programs at the level of “walk”.  Most organizations though engage in “talk” as if they are doing such things, even if they don’t really do them.

There are a couple of simple things to consider as a result of these dynamics.

If you invest in an individual’s interpersonal behavior change, you need to move them into a new job to have a reasonable chance of recouping on your investment.

When individuals are motivated to spend personal resources on changing their interpersonal behavior at work, they are also at high risk for leaving your organization in order to find another job where they can practice those new skills.

3. Interview based recruiting is all about “good enough” hiring, not future performance excellence on the job.

The academic research is clear – talk during recruiting interviews is not correlated with eventual final candidate performance on the job. But everybody continues to do to use talk based interviewing as their primary recruiting tool. Why?

Talk based interviewing finds “good enough” candidates – both on the technical skill level and culture fit level. Talk based interviewing does not systematically succeed in finding the “best candidates”. It does not need to. Good enough is good enough for most organizations. Few organizations are really excellent. Most organizations talk ‘excellence”, even when they don’t “walk” it.

It is possible to recruit for excellence. It takes “show us how you will perform with the people that you will be working with” recruiting techniques. This means crafting work based role plays and work based simulations. They are more difficult to set up and to facilitate than interviews. Creating them, and then facilitating them, is far beyond the skill of most recruiting professionals.

The best way to see how a person will behave in the future – on the job, is to get them to behave currently.  Get candidates to do, not talk about what they have done. Even “behavior based interviewing” does not do that.

Job based role plays and work simulations go some way to allowing the assessment of performance fit. Involving future peers in interacting with candidates and then systematically collecting their impression of fit allows some level of assessment of cultural fit.

The best hires – excellent performance fit to a particular job and superb emotional fit to a specific organization’s culture – are often temporary folks who have already “demonstrated” how they will perform on the job. You see what they can do and how they will interact with their fellow co-workers during their temporary assignment. The best predictor of future behavior is always past behavior.

Bringing the person in on a temporary basis is the best way to assess both performance fit and culture fit. It remains the best hiring tactic if you are hiring for excellence. If you are not, and most organizations do hire for good enough, then the talk that happens in recruiting interviews will do.

4. Many human abilities are as much instinctive as thoughtful. Excellence at work requires thought rather than just responding instinctively.

More and more, modern research is showing how much of our human capability to do and to interact with others utilizes ability systems that located in the pre-conscious parts of our brains. These evolved ability systems let us become the dominant species on the planet hundreds of thousands of years ago.

Somewhere in the past 40,000 years or so, we began to move from being tribal creatures to being societal ones. We started to live in conglomerations of individuals which were bigger than one tribe. Previously, as simple tribal members, we might have had occasional interactions with members of a number of other geographically local tribes. But as societal creatures, we developed (i.e. added) the ability to be concurrent members of a number of tribe-like social collections that exist within our societies.

As societal creatures, we developed organizations that specialized in achieving at least some of the objectives of each of their members. We shaped these organizations in which that reflected our evolution as tribal beings. Our organizations have hierarchies and insider/outsider dynamics that we developed as tribal creatures. At the same time, as societal creatures, we developed shared mechanisms and processes for collaborating within and across these organizations.

Organizations traded with other organizations for the resources needed to achieve those objectives of each organization’s members. Thoughtful, structured, planned ways of interacting with individuals in these other organizations became as important a part of our human abilities as our instinctive ways of interacting with other individuals in families and in tribes.

Today, we have all these types of ability. Our gene based evolutionary history adds new abilities to our competency repertoires. It does replace the ones we already have with new ones. Neither does evolution act to integrate new abilities with old ones in balanced way. As a species, we have simply added the new more thought based organizational abilities to our older instinctive interpersonal familial and tribal ones.

Stress is a large of our organizational and societal life. Under stress, we tend to fall back on our instinctive abilities, even when they might not be as effective for dealing with a given situation as our thoughtful abilities. Our instinctive abilities often define our business and societal interactions. Much confusion and turbulence occurs in organizations and in societies as a result.

Understanding and mitigating the results of these dynamics requires that managers in organizations consciously override their instinctive first responses with careful, thoughtful, analytically-based responses. The next generation of organizational behavior writing and business professional development curriculum needs to be much more clearly explicit about the evolutionary nature of human abilities. We need to move from theories of “emotional intelligence” to ones that more clearly reflect the additive evolution of our abilities. We need to make sure that managers understand that they concurrently have instinctive interpersonal and thoughtful organizational abilities. We need to help them recognize that our instinctive abilities, the ones we all move to under most levels of stress, are not the best ones to use to respond to the demands of organizational and societal life.

Conclusion

There is tremendous hope for us as human beings. Our evolution has given us the ability to shape our collection future through collaborative, thoughtful organizational action. But we often do not. Our evolution has also given us the capacity to interact in ways that are firmly embedded in the pre-conscious instinctive abilities that evolved when we were members of families living in tribes. We need to move beyond the familial and tribal in organizational and societal life in order to have a future of hope, not one of self defeating strife.

Facing Our Future: The Age Driven Dilemma in Western Society.

03/26/2012

Let so many of my contemporaries who are past 55, I am finding harder and harder to find interesting work. The next generation of managers – the folks in their 30s, 40s and even 50s, are simply not comfortable working with us. As a result, they tend not to hire us as employees or engage us as contractors / consultants.

The “freedom 55 myth” that pervades our societies makes that reality for many members of my generation even worse. These marketing myths suit the pension plan industry and the banks but do not really mirror social reality. Surveys have shown that many folks do not have well crafted or stable pension plans. Some of us simply had careers that meant we did not stay with one firm long enough. Others saved and invested in the stock market, long considered a haven for retirement saving. The stock market’s main purpose used to be raising capital for business enterprise. Today, speculative and computer algorithm based short term profit taking dominate its dynamics more and more. Retirement oriented investments are often not stable enough or generate enough steady return to provide adequate income for retirement time periods that get ever longer. Life expectancy is steadily increasing. More and more people are staying healthy for longer periods. Modern medicine now leads to recovery for things that used to mean death.

Retirement income needs are increasing. The actuarial pool model that underlies most pension plans – many people contributing over a long period of employment but not all of them living for a long retirement periods to take out their benefits – is being progressively undermined by the reality of our social dynamics

Many of the folks who expect stable pensions will be rudely impacted in the next 1 to 30 years as their pension plans struggle with demographically based declining contributions at the same time as more people live to expect benefits for longer periods of time. Many apparently stable pension plans will simply collapse under these pressures.

Income from a pension plan is not my problem. I don’t have a comfortable pension plan that is managed by someone else. I chose to invest in entrepreneurial ventures in my late forties and fifties. I did not succeed in them as I had hoped. So generating income in some way will always be part of my life.

But then I never expected to retire either. I always wanted to continue working as long as I had the health to do so. I seem to have lucked out in my genetic endowment. Three of my four grandparents lived long productive, socially active lives into their eighties and nineties. More and more, the evidence indicates that genes combined with exercise, diet care moderation and modern medicine increase the probability that I, and many others, will, live longer than most folks in previous generations. If I want to work, I am likely to healthy enough to be able to do so.

My model of my life’s progression, and the continuing place of work in it, was different from the one inherent in the “freedom 55 myth”. I experience work as providing me with dignity, a place for being creative, an environment in which I continuously learned continuously and a sense of personal joy in who I was professionally. It was not a “grind” from which I needed freedom

So, it is with some surprise that I am facing my current situation – a social climate that does not support many of my contemporaries and myself in our desire (and our need to) work actively in the later stages of our lives.

The shared employment models common in our societies have not kept up with this growing social reality. Jobs are still seen as part of a career leading to retirement. Instead, we need to start thinking of them being a life long need. The numbers of hours may decrease with the age, but not the need to emotionally engage in meaningful and income generating work.

Corporations still staff their human resource executive posts with individuals who hold the “freedom 66 myth”. They fill their recruitment teams with younger people who don’t really have a sense of the new social reality faced by a large number of people in their 60s and beyond.

Not all of these older folks find fulfillment in travel or babysitting grand kids or going to the community center. They describe themselves as “young minded” in a way that is new in our societies. For many, their sense of personal identity is strongly connected to making a valued contribution to the society they live in through some level of meaningful work. In addition, they will need the income generated to live with dignity and a sense of self resourcefulness.

Increasingly, such folks will become more important in the voting dynamics of our modern democracies. Unfortunately, our politicians are out of touch with much of this. Their own pensions plans are among the best sheltered in our societies. But as keepers of the public purse, they are beginning to panic about the growing strain this age driven change places on our collective social finances. So, we hear then talking about limiting public pension benefits, supporting the change corporate pension plans from defined benefit to earned value and so forth. They do all this while blindly assuming that their own pensions will be inviolate in the hands of future politicians.

Today’s politicians do not seem to understand the needed deeper social changes that are required to cope with these age drive societal dynamics. These changes need to start with an update in our shared model of what constitutes a productive life in our society and how this relates to employment.This change will require a long period of sustained dialogue at all levels of our societies, public, private and individual.

Politicians are more reactive than proactive. Their short term orientation, driven by the next to win the next election, blinds them to longer term social dynamics. They are not leading, or even just facilitating, the dialogue needed to create the “new solutions” – solutions with involve some fundamental changes in the shared way that we think about the age related progression of our lives in our societies.

Neither are the “associations” of older people in our societies providing productive leadership. They are still largely oriented to lobbying current politicians to get the “benefits” of being older – stable, inflation protected pensions, government paid medical benefits, and stable social conditions in which they enjoy traditional view of retirement – as a time to “stop” the grind of work and travel and relax. But this will change.

The crisis faced by the part of the older generation who today do not have the pensions they need to live with dignity will expand as more and more pension plans cannot cope with financial demands placed on them. When that happens, a new political dynamic will emerge in our society – that of the older voter angry at the failure of social contracts they felt they could count on. The time to start addressing this dynamic, and making it a positive one, is now. If we do not start and sustain the societal dialogues needed to make changes in our current models of retirement and employment, we as a society risk an angry backlash by older people. That is not a good prospect in democracies in which older people’s share of the popular vote is increasing.

The Jobs and Technology Elephant in the Room No One Wants to Talks About

03/10/2012

A Little History

It’s 1965. I am working as a junior clerk in the research and development department of a national railway in Montreal, Quebec, Canada. My main task is to type up the results of pricing estimate calculations done by one of the approximately 125 men who sit in 10 ranks of desks behind me, 12 to a rank. They all work on the most advanced Friedan mechanical calculators. Their job is to use the local knowledge that they developed through practical train handling experience on parts of the cross country rail network to work up price estimates for the point to point potential movement of goods for customers.

These men share some important traditions. For the most part, they are all older men with a long career working around freight trains on the railway. When one of them retires, they all move up a desk. Understanding your career path is easy in this department.

Whenever this happens, a new recruit is found out on the rails. Many men out there want this desk job. It pays better, and the work is warm – office work. But not all of the who want the job have the math skills needed to do the job. Only the ones that can demonstrate them get a chance.

The department chief clerk also takes care to ensure that knowledge of the rail configuration for entire railroad is always present in the room. Understanding your career path is easy in this department.

Once here, the new man rapidly learns to take part in the group’s Friday afternoon tradition.  They called it “the train leaving the station”. At 4:30, the most junior of them, sitting at desk one in rank one, entered 999999999 times 111111111 into his calculator. As his Friedan started chugging out the calculation, the man behind him did the same, and then the next man and so on. The sound in the room sounded just like an diesel engine picking up speed as it started out of a train station. By just before 5PM, the last calculator sighed to a stop. The men got up and go home for their weekend.

Then along came a young engineer called Russ. He has just learned FORTRAN at a special course for engineers at the local university. He thought he could program an IBM 60s mainframe computer to do these calculations.

It took Russ just three months to write a computer program which estimated pricing for movement of various goods from point to point in the network. It took him another 3 months or so to capture the local knowledge of the 125 men in the desks behind me in a variety of tables that he used in the program.

The men and the program work side by side for a month. At the end of the month it is clear.  The program can produces results at least as accurate as the calculations done by the men. And the program can do it must quicker, even in a batch card mainframe computer environment. Beside speed of calculation is not that important. Overnight results are perfectly acceptable. That is faster than the fastest of the men, who usually took two days to complete a pricing estimate.

The computer program is implemented. 126 jobs disappear overnight (theirs plus mine). It’s the first first time in my career that I experience the ability of technology to destroy jobs. My response is simple. I learn how to program computers.

Since Then, I Have Been in the Business of Destroying Jobs

First as a computer professional, and then as an IT executive, I have delivered on countless technology project. Every time, the business case was based on replacing the cost of people time with far less expensive, and often much more reliable, machine time And I am not the only person to do so. Business has been doing this steadily since the beginning of the industrial revolution. But computers made it possible to extend this from the factory floor to every aspect of enterprise.

At First, We All Benefited

The tremendous increase in productivity that we have experienced in the Western world since the Second World War is the result of the applying technology to making of things, the growing of food, the harvesting of useful things from nature, and the management of information in offices. The resulting productivity growth has driven a dramatic increase in our quality of life. Every thing became cheaper at the same time as average income increased. To most of us who grew up after the Second World War, it seemed like this would never stop.

But I never forgot that first lesson. The economics of technology investment is simple. Replace something that costs more in the long run – human labor – with some that cost less in the long run – machine labor. As long as we lived in a world where we could endlessly expand – because we were trading with the underdeveloped economics that were far behind us – or because there seemed to be no ecological cost to exploiting natural resources, our societies just boomed along.

Technology Ruled, and Had a Hugh Impact on Defining our Society’s Culture

We live in societies where jobs, as well as being the source of family income needed to maintain the family’s members, are an important part of our identity as social beings. More and more, after the beginning of the 20th Century, a job defined who a person was. Job based income was the primary way to support a family. Sometime during the 19th century, for most people, who you were socially became less a function of the land you owned and more a function of the work that you did.

And this trend continued during the 20th Century. By the end of the century, this was true for most of the women in Western societies as well. Women entered the labor force in large numbers after the Second World War. Their jobs, as well as the job based income they contributed to their families, became an important part of their personal identities as well.

Increasing Productivity, and Aggregate Growth In the Size of the Gross Domestic Product, Became the Core Way We Defined Progress in the 20th Century

Throughout the 20th century, we kept finding new ways to use technology to reduce the hours of labor (which translates to the number of jobs) needed to produce the products we needed, the food we eat, the raw resources we harvest, and the services we consume. As we were doing so, we were also constantly increasing the “quality of our lives”, measured largely by disposable family income, and an ever increasing supply of products, food and services. We knew that we had it good. And in the short term, year over year, we did.

Human Beings are Not Great Long Term Anticipators

We are human. Our evolved strength as individuals is to look out over this season, and do some planning for next one, and maybe the one after that. A few of us think about over longer periods of time – as measures by generations and decades. But most of this is speculation. Of all of the speculation that was done in the 20th Century about the future, only a very small percentage turned out to be accurate, as evaluated by the passage of historical time.

Even when those of us who speculate about the future share their speculations in writings and other forms of communication, most of us don’t act on what they say, either as individuals or as societies.

The Consequences of the Destruction of Jobs by Technology Has Built Up Steadily

In the last five decades, we destroyed jobs in manufacturing, in agricultural, and in harvesting natural resources. When we first realized that this was happen, we talked about becoming a service based economy. The productive use of technology in manufacturing, agriculture and harvesting allowed us to create more jobs in the service sectors in our economics.  We took some of the economic “wealth”[1] created by this growth in productivity, and used it to “finance” the creation of these jobs.

Then toward the end of the 20th century, we started to apply technology to office and other service jobs. We began to have some sense of what the inevitable impact of this trend. But we were not clear about it. So we talked about becoming a knowledge based economy.

We still needed jobs, both for the identity they created, and for the job based income we needed to support families. As we used technology to destroy office and service jobs in the public sector, we created more and more new jobs in government. We also expanded tax financed service sectors such as health care and education. To pay for it all, through the magic of money, we also started to accumulate growing government debt. We used money to put off the real bill for all of this somewhere into the future. We believe that the growth boom we had been on for the past 100 or so would never come to an end. We believed that future productivity increase would somehow allow us to cope with this debt.

The Internet and the Export of Jobs

Then in the last decade of the 20th century, we created a technology which made distance largely irrelevant to doing work with information focused work – the Internet.

The relentless economic logic of our short term, year over year, profit maximizing capitalistic investment models led to us continued to kick in. We use the Internet to export more and more of our remaining manufacturing and agricultural jobs to “offshore” economies where the lower cost of living generated a short term profit maximizing advantage.  Communication over the Internet, combined with the technology of air travel, allowed us to effectively manage these distance jobs.

We are now doing the same with public sector information based and other service jobs. Only political pressure, exerted through lobbying on our politicians, has slowed the pace at which we export agricultural, health care, education and government jobs to the lower cost of living parts of our globe.

A Short Term Blessing, Long Term Pain

Our dedication to the relentless economic logic of short term, year over year, profit maximizing investment that has helped us become more productive over the past 5 decades is being to catch up with us. It had huge benefits. We expanded technology under its logic. We increased the quality of life for most Western people under its influence. It is a classic example of the vision strength that our evolution has given us – the ability to act energetically this year’s seasons, and to look ahead to next year’s seasons, and perhaps the year beyond. Sure, the theory for looking longer is there. We do 5 and 10 and 20 year return on investment calculations. But we act in much shorter time frames. We are not really very good at anticipating the longer term consequences of our short term smart actions. Most decision makers did not want to create global warming and environment destruction and resource deletion. But we did anyway.

The Same Pain is Now Starting to Happen With respect To Jobs.

As we destroyed jobs in manufacturing, agricultural and natural resource harvesting, we compensated by creating more jobs in government and tax-finances services. The consequences of doing so are now become dramatically clear.

  • The more government jobs we created, the more government gets involved in the day to day detail of our commercial and private lives.
  • The more health care and education jobs we created, the larger their proportionate cost when compared to our gross domestic product became apparent. We are being to become concerned about our ability to pay for all of them out of tax based finances.
  • The more jobs we exported to lower cost of living economies, the less national family income there is to support our families and the smaller our tax base for paying for those government, education and health care jobs.

No One Openly Talks about this “Elephant in the Room”

We don’t talk about this “Jobs and Technology Elephant in the Room” dilemma in our public discourse. We can’t blame anyone for it, tempting as it is for some of us to blame big business or political leaders. It is simply another consequence of our evolved strength as human beings – act to shape this year’s seasons, and next year’s, and maybe the seasons after.  We might talk about longer time frames.  But we find it almost impossible to collectively come to consensus about how we should act in the short term to avoid negative impact of job destruction in the longer term[2].

Instead, our politicians talk about investing in innovation or in small business or in new infrastructure programs as ways to create new jobs, and solve the loss of job problem.  They are out of touch with the longer term dynamic inherent in investing in increasing productivity through the use of technology.

It is a Deep Structural Problem that Comes From Being Human

None of our current political talk will solve these basic underlying structural problems.

Some people reading this essay will respond by saying “your logic is too simple”. But like all such logical simplifications, it has one great value – it illuminates.

Because the logic used here is rather simple, you can point out lots of specific counter instances. Unfortunately, doing so does not invalidate the relentless reality of the following logic.

  1. As human beings, we extract things from nature, through harvesting or through growing, to meet the needs of our lives – sustaining ourselves and creating and supporting our next generation.
  2. As tribally evolved creatures, we have invented complex forms of social collaboration to make that process more productive – the sum of what we accomplish in groups through specialization of labor and trade of goods / services is far greater than what we can produce as individuals.
  3. We now use work based income as the main means to distribute the economic results of that social collaboration. We use jobs to allow individuals to get the income they need to participate in the highly symbolic societies that we have created in the past 10,000 years or so.
  4. We participate in those societies because we evolved as human beings to develop ourselves (I-Me), take part in relationships (We Two), live in families to nurture the next generation (Our Family) and belong to tribes in order to define our social identities (My Tribe).

Of course, we no longer do all of these things as simply as our ancestors did millions of years ago. Most of us belong to more than one tribe for instance. But the underlying psychodynamic of being a human being has not changed all that much in that time.

  1.  In the past 150 years or so, our ability to develop and to apply technology in an ever more productive ways has resulted in the integration of our societies into a global network, inter-dependent on trade in goods and services to ensure our collective well being.
  2. In the past 50 years or so, the relentless logic of our short term, year over year, capitalistic pursuit of profit in our integrated global economy has led us to substitute technological labor for human labor, or to export human labor to the lowest cost part of the global.

We will of course eventually use substitute technological labor for human labor there as well, once the cost of living standards become more equal across the global.

But this whole approach to managing technology – substituting technological labor for human labor while using job based income to support individuals and families – is no longer sustainable in its current form. It is destabilizing our societies, both nationally and globally. The signs of this are all around us.

The Signs of Global Destabilization

  1. The global debt crisis threatens international stability and personal well being.
  2. The growing loss of employment opportunities for our youth threatens the stability of our societies.
  3. The growing pension crisis threatens the well being of the older part of our population. This will undermine the stability of our societies.
  4. Global warning, which is the result of the unanticipated consequence of our current ways of producing and using energy to mobilize our societies,  can undermine our societies.
  5. Our collective inability to control our societies’ dependence on the limited natural resources like oil and gas and the ocean’s clearly declining fish stocks will undermine our societies.
  6. The unlimited exploitation / destruction of forests could have a negative impact in the natural process that refreshes the air that we breathe. Our collective inability to address that and institute a substantial approach to the harvesting of resources form our forests can undermine our societies.
  7. The growing political instability in parts of our world and the associated confrontation dynamics engaged in by leaders at the national level fuels the constant nagging concern that that we could experience fuel nuclear based confrontations that could dramatically alter the nature of our globe, at least in part.
  8. The growing distrust of the average citizen in the ability of their governors / governments, whether elected or imposed or hired, to address these dynamics, never minds solve these problems is undermining our societies.

So what is the solution? 

I have ideas, but I fully accept that I DO NOT KNOW. I also do not believe that any other INDIVIDUAL knows. The issues need collective responses. The only thing that I can do is express my ideas on these issues in order to contribute to this collective dialogue. If others agree, then I have done what I can do. If others have been ideas, then I need to listen and be persuaded by them.

I believe that we need new forums (and also forms) of dialogue that bring people together, both within and across societies, to talk about these issues and invent new ways of address them collaboratively[3].

Collectively, we have evolved as collaborating tribal creatures.[4] We need to come up with new shared models – ways of thinking – new forms of culture – new shared ethical norms –  which allow us to tackle the following challenges.

  1. Move beyond the relentless short term, year over year, pursue of profit, while retaining the positive aspects of capitalism – its fostering of innovation, its creative destruction of old ways of doing things so that they are replaced with new ways that produce more with less and do so in a way that is not destructive of either people or the ecology of our globe.
  2. Create ways of living that allow human beings to live as dignified family members that are committed to the successful rearing of next generations, however the family is defined and takes into account personal sexual preferences.
  3. Create models of work that allow human beings to excel as individuals while as the same time recognizing the vast variety and variability of individual capacity, motivation, and drive, which at least in part results from the differences in the genetic and rearing endowment we each receive before we can exercise effective personal choice.
  4. Create political institutions that recognize limitations of our “I-Me, We Two, Our Family, My Tribe” psychodynamic inheritance from our evolutionary history, while more effectively dealing the needs to plan and to anticipate the consequences of our social decisions on our ecology over time spans that exceed the current and next generation, so that we don’t inadvertently destroy the future quality of life of our descendants not yet born.
  5. Replace the current societal definition of personal identity as being partially dependent having (or having had) a job that is current in at least Western societies with one that is more focused on making a contribution to society over the course of one’s life in a variety of ways.
  6. Replace the current use of job based income as the way in which the majority of individuals get the economic resources they need to support themselves and their families with an alternative that still fosters personal initiative and a sense of responsibility for self (i.e. not living out of your neighbor’s “wallet” by saying that the “government should” support” your or provide services and resources you need at no cost to you).
  7. Create forms of economic, governmental, and personal accountability, based on complete transparency of information, that essentially eliminate the large amount of intended fraud and societal posturing that allows those of us who are most self serving to take advantage of those of us who are more narrowly focused on the meeting the needs of our personal and family lives.

None of this will be easy. But we better start, or we will lose control of our future, both as individuals and as members of our societies. If we start to do this, we will also come up with solutions that make the “Job and Technology Elephant No One Wants to Talk About” go away of its own accord.

I believe that the Internet, and talent from the so called underdeveloped world, will be a large part of meeting this challenge.

I also believe that our understanding of the nature of leadership will need to be completely redefined, moving from a model that is based on “I am the leader of the tribe and therefore you follow” to one that asserts “I am highly skilled at facilitating, both through my personal persuasion of others and through my use of Internet  to facilitate dialogue which allows people to collectively invent and communicate new ways of thinking and acting about how we live on our globe”.

We are an amazing species. We have the ability to recognize our limitations. At our best, we cope with any long term dynamic our short term strengths create for us. At our worse, we engage in mutual destruction (e.g. war) fuelled by fantasies[5] of what the world and others are like.

We have a choice. We have free will when it comes to the future.  We can create solutions out of collective dialogue that will also get beyond all of this. Or we will not. It is simply a question of choosing in our personal lives. The other amazing thing is that we now have a technology, the Internet, where personal expression has the potential to persuade others in a way never before experienced on our globe.


[1] The role and nature of money, a form of shared social meaning created by human beings to facilitate the development of ever more complex forms of social organization, really needs to be part of this story. But this is beyond the current scope. As a result, I use worlds like income, wealth, finance, and economy knowing full well that I am avoiding explaining how the human creation and use of the idea and social reality of money impacts this all.

[2] Our ongoing collective failure to respond in a coordinated fashion to climate change and the over exploitation of the ocean’s natural resources are the two clearest examples I know of this dynamic result of our evolution.

[3] These forums and forms of dialogue must be much more effective that the current international set of meetings in which politicians and bureaucrats (the governors) engage (e.g. on international trade, climate, regulation of the oceans …). These current gatherings are really just meetings of the privileged. Unless they become far transparent and far more accountable to the world at large, not nation’s internal political elites, their only real result will be to continue to convince the globe’s people at large that politicians and governments are completely ineffective in dealing with the globe’s real dynamics.

[4] As well as warring ones – but that is a topic for another day.

[5] I wanted to say “paranoid fantasies”.

Why the planned Facebook IPO is not really about creating value?

02/03/2012

Roger Martin, Dean of the Rotman Business School in Toronto, recently wrote about the problems plaguing capitalism in the 21st Century. Among other things, he calls for us to focus more on “creating value, rather than trading it”. The current news frenzy about the impending size of the Facebook IPO is a prime example of how our media and investment communities have become fascinated with “trading value” rather than creating it.

What things of value has Facebook really created in its history? Not much really, in my opinion. All of the technology that Facebook uses already existed, or has been created by human beings not associated with Facebook. Zuckerberg and his team have not really created anything new. They just applied existing software and hardware technology to something it has not been applied to before. That is not the same thing as creating some fundamentally new – creating value.

The innovation that Facebook can claim is that it has allowed individuals to engage over computer networks in a form of communication that has been important to human being for generations that go back past recorded history. Let’s go on a bit of a bio-evolutionary sidetrack to understand this, and then come back to the planned Facebook IPO.

We evolved as social and abstracting, language-using beings. Our multi-layered, complex brains developed over many millions of years and endless generations to cope with the complexities of our lives. Our evolutionary history has resulted in our having brains that can do more than one thing at a time. We have continually added capabilities to our brains, adding the new abilities to while retaining old ones. As a result, we have many capacities that occur at a preconscious level. We have others that result from the interaction of old abilities with newer ones. As a result, our internal psycho-dynamics involve 5 highly intertwined streams of capability.

  1. I- Me

We live with a sense of self (I-Me) that is capable concurrently of being-in-the-moment (I) and dissociated from that immediacy through conscious reflection on my immediate being (Me). We are probably the only species on the planet that has this ability. (Although our inability to communicate intelligently with some other highly social species – whales, dolphins, and perhaps elephants – means that we cannot really know for sure.)

  1. Us Two

We form and thrive in complex multi-layered pair-bond relationships that last over long periods of time. We form them not just for the purpose of reproduction, but also for enhancing our personal survival, sharing physical and emotional pleasure, increasing our personal growth, and enhancing our status in our social world.

Although other species form pair bond relationships, we humans invest them with a level of meaning and importance that seems unique. We bring our concurrent I-ME psychodynamics into them. We are the only species on the planet that is consciously obsessed with the moment to moment and long term elements in our pair bond relationship.

  1. Our Family:

We raise children for an extended number of years, taking them through a complex series of development stages that equips them to live as adults on all of the levels captured in the phrase “I-Me / Us Two / Our Family / My Tribe / If –Then”. We are a unique species in this regard. We have the longest and most complex developmental history of any species on the planet. As a result, the importance of, and the amount of time we spend being aware, of “our family” history and connection is also a defining characteristic of our species. We cannot separate our sense of self (I-Me) from our being a member of “Our Family”.

  1. My Tribe

We lived in tribes for far longer than we have lived in societies. Tribes are collections of human beings that number in the hundreds. Each person in a tribe knows, at some level, all of the other members of that tribe. This is the most fundamental characteristics of the tribal human psychodynamic.

Societies are far larger than tribes. Societies are collections of tribes. Societal dynamics are the result of the fact that when living in a society, an individual can be a member of multiple tribes. For instance, when you go to work, in participate in the life of your “work tribe”. When you go to a sport bar and cheer your favourite team with your friends, you participate in the life of your “sports” tribe. When you participate in the activities of a political party, you are a member of your “political” tribe. This is a fundamental characteristic of a society. It allows individuals to concurrently participate in the life of multiple tribes.

Human beings have lives as individuals, as members of families and as members of tribes for millions of years. They have lived in societal groupings for thousands. Although no doubt, evolution is adding capabilities to our brains for participating in societies, we are the very early beginning of this evolutionary process. Most of the time, we cope with the pressures and issue of societal life by using our tribal psychodynamics.

Many of the difficulties we face in current societies come from the fact that we evolved as tribal creatures, not societal ones. War for instance started as an inter-tribal dynamic, when tribes competed for limited resources. We now live in a world where our grasp of technology and our application of it to the tribal business of war threatens our existence as a species. Today in war, our internal psychodynamics, including our emotions, are tribal, but our probability of survival is based on the enormously destructive application of science to the technology of war. War has become disconnected from its first purposes, ensuring the survival of the tribe. War now threatens our survival as a species, something it has only done in the past two centuries. Yet we seem unable to stop war.

We evolved complex in-group / out-group psychodynamics that allow us to participate effectively as individuals, as pair-bond mates, and as family members in tribal life. Our ability to exchange good / services (trade) and our capacity to bind our behaviour through contracts (live by law) developed from our living in tribes and from our interacting with members of other tribes.

We respond to tribal based normative patterns that govern our I-Me, Us Two, and Our Family behaviours. We follow leaders that are necessary for the success and survival of our tribes.

But often the limitations inherent in these tribal capabilities seem to distress the societies we now live in. Just look at the negative parts of the current political process, of which the negative advertising current in the US Republican race for the Presidential nomination is only the latest example.  in the US.

  1. If-Then

As well our abilities on these four human levels (I-Me / Us Two / Our Family / My Tribe), our evolving brains also developed the ability to abstract and to reason using language. We have the capacity to think and to reason about space in that that is not limited by the fact that we live, like all living creatures, in an immediate here. Our sense of space transcends the immediate space we are acting in. We think and talk about the here and the there naturally, without questioning the wonderful thing that this ability really is.

In same way, our sense of time is longer than the immediate moments in which we live. We abstract from this immediate now, just as we abstract from the immediate here in which we live. As a result, we have a conscious sense of time that includes the past, the present and the future.

These two capabilities are the basis on which we evolved our ability to logically reason. If-then reasoning involves putting things in past-future sequences. It can only develop if we have a sense of time which includes the past and future – an abstract sense of time.

In the same way, spatial if-then reasoning can only evolve once we have a sense of here and there – an abstract sense of space. Language was necessary to, an evolved as part of us having a Us Two, Our Family, My Tribe level of psychodynamic capability. Language is the framework within which we developed to have ability to do past-future and here-there if-then reasoning. Our ability to logically reason is the result of our complex lives as I-Me, Us Two, Our Family, My Tribe creatures.

Our evolved logical, reasoning abstract consciousness interacts with the preconscious many systems we use to deal with the needs of ““I-Me / Us Two / Our Family / My Tribe” lives. We are not consciously aware of much of this interaction.

Side Note:

But we are developing the ability, through our societal creation of disciplined forms of communicated thought (i.e. science). to gain insight into these dynamics. Our creation of technologies that allow us to examine our brains’ functioning from the outside in (e.g. thermal and magnetic of brain functioning) is contributing to this growing insight.

It will be interesting to see where all of this will lead. More and more, we applying the “if-then” – logical reasoning part of our mental abilities to generating insight into the way that the “I-Me / Us Two / Our Family / My Tribe” parts of our brains work. We are only just beginning.

We also use time and space abstracting, shared logical reasoning to create technologies which have and are dramatically restructuring the material conditions of how we live on this planet. We are being to realize that not all of this may be positive for our future as a species. But we have evolved over millions of years, and barring a self made planet wide disaster, are likely to continue to do so for millions of year to come.

Personal Note:

The only reason that I might want to travel in time is to see where this fascinating l I-Me / Us Two / Our Family / My Tribe / If –

Then evolutionary process might take us in a million years or so. Ah well – it is not to be.

So how is all this relevant to Facebook? What Facebook did was automate one of the two integrating capabilities that evolutionary human beings have developed to cope with the needs of their complex internal psycho-dynamics – gossip. Telling stories about our selves, our partners, our family members and the folks in our tribes is profoundly important to re-affirming who we are on the “I-Me / Us Two / Our Family / My Tribe” levels.

Our other great integrating capability is story telling. Stories, starting with the family stories we hear as children, help us make conscious the results of the complex, intertwining of our I-Me / Us Two / Our Family / My Tribe psychodynamics. Stories, both historical and fictional, also educate us about “what we might be” as a result of our intertwined internal psychodynamics. This explains the tremendous importance of all forms of businesses related to story telling in human history, e.g. writing, publishing, entertainment, movies, etc.

Facebook uses existing technology to make gossip – personal story telling – easier for people. Facebook extends their ability to do so over distances and times that exceed our physical limitations. Suddenly, using Facebook, you could tell a story about yourself or another individual that could be access by other people even though they were far away or not connected to you in you’re here and now time. Given the importance of gossip and story telling in human life, it was no wonder that Facebook took off once people realized what it could do.

As it matured, Facebook the organization then used the size of its community to attract high levels of advertising revenue. Advertising is a form of human story telling devoted to selling products and services.

As a result, Facebook makes billions of dollars annually. But it is from doing nothing something fundamentally new. I personally believe that Facebook almost blundered into this combination of  success factors, using technology to extend the reach of human gossip – personal story telling. But I cannot be sure. After all, I was not there as Facebook the organization developed and grew. That also explains why I am not as rich as Mark Zuckerberg.

I am not the first person to say that Facebook “really does not need the money”. So why is it bothering? How will Facebook use the almost 4 billon in cash it has on its balance sheet and the new 5 billion that financial pundits are saying an IPO will raise? Will Mark Zuckerberg and the other folks who control Facebook use this money to “create new value”? My bet is no.

Instead, I believe that we will see Facebook “trade value” through acquiring other technology companies. That will be unfortunate. But Facebook’s has a history not really creating anything fundamentally new. Instead, it almost blindly applied technology that already existed to parts of human life that had not been automated before. The founders of Facebook seemed overwhelmed by the fact that Facebook’s appeal extended far beyond the universities that they saw as their marketplace just 7 or so years ago. All of this leads me to believe that “trading, rather than creating, value” is the most likely future use of all of this money.

Crucial Myths About Talent in Our Society

03/09/2011

I believe that talent is everything in achieving organizational excellence. Single or simple-minded talent approaches will not work in the competitive world of the 21st Century. The world is a more inter-related place. The global integration of the world’s marketplaces has brought new opportunities, and new challenges and threats. The impact of technology has shortened time cycles and decreased the impact of distance. A society’s ability to nurture and effectively align talent with appropriate opportunity is its ultimate and only source of competitive advantage.

Unfortunately, many of the social myths about talent that were developed and proved effective in the 20th century world, and earlier, still hamper our ability to do this. Some of these myths cripple our ability to provide a sustainable standard of living for all. They need to be replaced with new ones. Five of the key ones follow.

1. Psychological “employment” contract

Old

The psychological contract between employer and employee works best if it includes the idea of long-time employment and employer responsibility for such things as benefits and pensions. A part of an employee’s wage must be held back by the employer to provide such “employment” benefits.

New

Adults, if educated and provided with appropriately structured and regulated service providers, can take responsibility for their short and long-term benefits and long-term pensions. Employees (full time and contract) should receive all of the payment achieved through their use of talent.

Note:

Employers must focus on the short-term (this year) and long-term (over the next 5 to 50 years) social and economic survival of their enterprises. They do not have the energy to also “provide” for the life-long benefit needs of their employees (permanent or contract).

Governments need to provide “enabling legislation” which facilitates and regulates the specialized service providers who do so as part of the social contract, just as employers used to do this as part of the employment contract.

2. Capital and its management

Old

The individuals in society who have access to,and who manage, capital do so because of some innate or acquired superiority of talent. They, therefore, have the right to expect a substantial premium payment for their use of capital

New

In the 21st Century, the lottery of birth and the market place has as much to do with access to capital as individual talent. All individuals have the right to be reasonably compensated for their productive use of talent, in whatever way they use it.

Notes:

Although the market place must recognize the contribution of capital (resulting from the past deployment of human talent), capital does not have some inherent right to be compensated at rates markedly higher than talent. Society can and must set these limits in ways, which reflect the underlying fact that talent is the source of all value in human society.

Financial capital cannot exist without society. It requires the common acceptance of financial exchange and social contract mechanisms (money, credit, contract law, and contract enforcement. Even slavery is ultimately a form of social contract). Without these, the only form in which capital can exist is in the products which an individual or cooperating group of individuals can produce or utilize by their use of their own talent, (largely personal tools, personally-harvested land and nurtured livestock), or through what they can “take = steal or inherit” from others.

3. Talent and its compensation

Old

Some forms of talent are inherently more valuable than others. The market place is a “fair adjudicator” of these differences. Therefore, some forms of talent desire to be compensated at rates that exceed others in large multiples (in the hundreds and thousands).

New

The market value of talent reflects “current” and “local” conditions, as well as social myths and stereotypes, not the innate nature of talent itself.

Note

Just like many other things in the market are “regulated” for the greater good, the range of compensation of talent can also be regulated for the greater good. This regulation will never be perfect, and must be subject to continual social dialogue about its nature and form.

4. Some talent is innately exceptional

Old

Some individuals have exceptional talents compared to the rest of us. They deserve to be compensated for their use of this talent at rates that far exceed the rest of us.

New

The exceptional value assigned to some levels of talent reflects social myths, trends, and stereotypes, not anything in the inherent nature of the talent itself.

Note

The folks with “exceptional” talent reflect what a society values at some point in time. They are not innately “worth more” than people who have their talents at average or less than average levels. (I hope that all college-educated individuals will have been exposed to the idea of the normal distribution by now, even if they reject it.) Some people have exceptional levels of talent in some areas that do not receive exceptional compensation, simply because “society” does not value their talent at that point in time.

5. An adult’s talent

Old

Some people simply do not have talent they need to be socially productive.

New

Every person who is capable of functioning on an adult basis on a day-to-day level in a society possesses the talent needed to contribute in some way to that society. The fact that some are not “valued” reflects the limitations of the society, not of the individual.

Note

It is clear to all of us that some people who are physically adults (i.e. they are older than 16 ,or 18, or 21 or whatever age is defined as the age of the onset of adulthood by the society in question) are not capable of functioning as adults in that society. They should be treated and cared for as if they were children.

Adults who function on a day-to-day basis in a society deserve to be treated as adults. Some societies are still strongly impacted by pre-21st century myths about talent. In such societies, people treat the inability of some of these adults to “use their talent” to earn sufficient compensation to support themselves as something for which to blame the individual.

Other societies (well, maybe only in the world of “Star Trek”) recognize that the choices that we make collectively through our political and enterprise processes have a great deal to do with the differential valuing of human talent. These societies provide appropriate social safety nets, which provide the basic dignity of survival (food, clothing, shelter, and health care) for all adults. Whether or not to do so is a choice we make through our social and political dialogue, not a “natural fact”. Such societies also recognize that all human adults have the capacity to make a useful contribution in some way.

People will argue that the existence of “criminals” invalidates this. However, it is both historically and sociologically clear that most forms of crime are socially defined. Most criminals only exist as a reflection of the current status of what they do in their society. (The best example that I can think of in this area is the lottery. In the 1920’s, the numbers game was criminal in North America. By the end of the 20th century, when in the hands of the government, this form of crime has become “non-crime”.)

Interpersonal violence may be the result of the fact that a person with the physical form of an adult cannot function as an adult. A society needs to cope with these folks in some humane, restraining way. We generally treat such folks as if they were violent criminals. Sometimes, individuals functioning as adults lose control and behave violently towards others in ways that we do not accept as “reasonable” in society. All societies set such limits and create social mechanisms to deal with it. But none of this invalidates the fact that all individuals functioning as adults have the potential to contribute to society in some way.

Concluding Note:

A social myth serves an important function in our society.I labeled it a myth because it is not about the physical or material world, and therefore cannot be true or false. You can observe and count and make statistical statements about a social myth’s adherence and relevance. These are facts – “x percent of the people in group y say they believe this myth”. You can evaluate whether or not this statistical fact about the social myth is true or false. But, you cannot state that the myth itself is true or false. You may believe it to be, treat it as an important value, but in doing so you are implying that social myths are the same category of thing as a fact. They are not.

I label them social because they serves an intensely important integrating function in society. People believe these myths. These beliefs impact the way that they structure their own lives and interact with others. Durkheim, the French sociologist, termed such integrating themes as being part of the “collective social consciousness”. I prefer to think of them as high integrative social myths or stories that shape our society.

What a way to start the New Year

01/03/2011

Friend of mine sent me this article this morning: http://www.dailywealth.com/1573/How-America-Became-a-Communist-Nation

Here is my response.

The authors of the above commentary has got it both right and wrong. It is not communism that is the problem. That is just their red herring.

I think the following trends have got us into our troubles.

1. State- ism:
the idea that the state is ethically, morally and intellectually superior to individuals. Senior civil servants and the politicians have become the new political elite, replacing the aristocracy and if you look back far enough tribal leaders who have exploited the other members of societies for their own ends.

2. Combined with utilitarianism – the idea that progress occurs when wealth is shared more equitably across a nation’s citizens. It did when it created a consuming educated middle class which drove the technological progress of the last 150 years.  But now it has become the idea that we can all live off our neighbors by appealing to the state to finance us, either as private citizens through welfare and tax grants / advantages / breaks or as corporations through transferring some part of our legitimate costs to the state (e.g. education, disaster recovery, start up and innovation incentive grants and tax breaks etc).

3. Combined with annual general ledger accounting – the idea that everything can be reckoned up and managed with on 2 sided profit and loss ledgers based on a calendar year,at both the state and commercial level.
This has allowed both governments and organizations to substantially discount future cost – e.g. climate warming, destruction of ecological assets, education of needed workers …. At the same time, it focused our civil and commercial  investment thinking into short term profit and loss instead of long term sustainability and generation over generation quality of living increases.

4. Combined with deficit spending for democratic governments funded by current and future income taxes
the idea that current spending can be financed by future taxes; really escalated to the point where we are now spending the next generations’ (who don’t have a vote) income.

If all current government income was current value tax based, the average person would be paying a sales tax of 65 to 70% on every dollar they spend to finance current government. That level of current value tax would not even begin to address accumulated government debt.  This level of taxation would provoke a psychological revolt that would quickly undermine existing democratic parties.

5. Combined with party politics in democracies: the idea that locally elected individuals – who should represent those who elected them – should be disciplined to the party line – the line set out by the party leaders. This has essentially replacing electoral democracy with tribal psychology based party politics.

Raising the red flag of communism is a kind of ideological Ludditism, which really does not help anything other than the previous commentator business. They are obviously trying to appeal to folks who response to that red flag label for his wealth management business.

However, as I keep telling myself – “give me solutions, don’t just define problems”. I believe that some of the solutions to mess we are in are relatively easy to state,  but very hard to implement, given the current state of our world.

1. Make government deficit financing illegal – legislate that governments must always balance their books within the period for which they are elected. That will eliminate their current practice of looking good today at some future governments’, and tax payers’, expense.

2. Eliminate income taxes – go to a value added transaction tax on all personal and commercial current transactions that occur in a society. That way people will really feel the current cost of the governments they elect. It also reflects the real role of government – create a sustainable, understandable, safe social framework within which both private and commercial citizens can contract and conduct business, live their lives.

3. Combine this with income support for the most poor 20% of society to eliminate poverty and want.  That allows those who will not / cannot support themselves the opportunity to survive while discouraging the kind of gross exploitation of the very poor that has characterized so much of our history once we moved from tribes to societies.

4. Move from annual commercial profit and loss accounting to something that reflects commercial reality more realistically – say 3 to 5 year profit and loss accounting. It is not a perfect solution but creates a better balance between the needs of short term / long term pressures that all commercial corporations need to address.

4. Allow individual vote, not party based votes, in the elected houses of government, on all issues in democratic governments at all levels. That encourages consensus seeking not party based control in government. It creates a much more complex dynamic for political leaders. But dealing with and successfully managing that dynamics is really their role.

5. Move to not-for-profit service delivery corporations for services that benefit the common good – e.g. transportation, health, education – without eliminating the need of such corporations to buy innovative products and processes from the “for profit” marketplace.- That will attract good service oriented quality talent to their leadership ranks. Make sure that they need to compete based a variety of unit-cost-over-time reduction and “service quality survey” metrics over the same 3 to 5 year time frame as commercial corporations are evaluated on their ability to generate profit.

6. Keep the “state” from delivering any service what so ever except for defense. Its job is to look ahead, plan, provide legal frameworks, coordinate, regulate – not do – in every area except for defense. Turn all existing government services – including law enforcement – over to competing non-profit corporation. Use the metrics laid out above to evaluate them. Have them responsible to boards that include representatives from government, the public at large and the “audiences served” (e.g. students, patients, parents, workers in these service corporations, suppliers, people impacted) and publish every decision they make, the minutes of every meeting they have, the views of every members of their board on the Internet.   Broadcast every meeting these Boards have on the Internet. Simply make high transparency a simple fact of their ability to govern these service corporations.

These would be my New Years resolutions, “if I were king of the forest”.

But since I am not, I will focus on an ever more important one for me in 2011. “Get on with turning my business round.”

Best to you all for your 2011.