Spot the Chairman

Corporates aren’t democracies. They have shareholders who employ (or are) managers, who set the goals and manage the performance of their teams. Corporates also aren’t free markets. Once you are hired, central decisions get made up the chain and strategies set. The most obvious exhibit to demonstrate this is salaries. If there was an internal market for skills and knowledge, then whoever needed something done would have to bid for their team. Instead, in most companies I know of, the bosses would be irate if a Spreadsheet of everyone’s pay got leaked. Like Chairman Mao managing the iron supply in a 5-year plan, the central powers need to trust the train of information about who is doing what. Layers of grades and metrics can be added to maintain the illusion of price (salary) and value bearing a relation. The beauty of free markets is the lack of pretence. Price isn’t value. It is a way of matching supply and demand. It is very noisy, but if both parties are happy, value is created. In Corporates, this falls apart because (1) the employee is full time, and (2) we don’t talk about pay. In some ways that is good. Imagine your pay moved like the markets? To cope with that you can’t live hand-to-mouth. To cope with noise (transparency and truth), you need to create space to breathe.

Can you handle the truth?

Keyhole Solutions

Keyhole Surgery is a minimally invasive approach to fixing a problem that restricts the collateral damage. I had my appendix out when I was a little guy. Embarrassingly (now) I was quite excited about it. My Gran used to bring me sweets when I was sick, and my older brother seemed to have such fun when he had his out. Balloons, TV, comic books. Hospitals aren’t scary. I turned out not to have appendicitis, but just an ulcer. Fortunately, the surgeon still felt the surgery was necessary. I still have the scar. Mine was small for the time. Now they are tiny. We are getting better at dealing with the specific problem. Immigration would be a massive financial boost to the global economy. Economist Bryan Caplan calls it “Trillion Dollars Bills on the sidewalk”, but people have concerns. In his book “Open Borders”, he takes the concerns seriously and provides keyhole solutions. The step forward with Capitalism was realising win-win wealth creation beats win-lose wealth extraction. The same is true of Property Rights. Freedom of Movement (Capital, Goods, Services, Labour) doesn’t take anything away. You can surgically remove Global Apartheid while protecting the things we rightly value. Wealth Creation doesn’t require oppression. Holding someone down doesn’t lift anyone up.

Release Prejudice

In a simple world where you did what your parent of the same gender did for a living, your path was decided. Our paths are still decided partly because of a coordination problem. We don’t know the complete menu of options, different people face different obstacles, and our GPS giving the route (skills and knowledge required) is like the glitchy ones that said, “you have arrived at your destination” when you are in the middle of the highway. Race, gender, sexual preference and class are slowly becoming less foundational in deciding what menu you have. Nationality is a horribly persistent sorting mechanism in a world of Global Apartheid that prohibits free movement of people (while treating capital, goods and services more kindly). Part of the advantage of building an Engine of Capital is that prejudice falls away. Money is fungible. Meaning it can change form in a laugh-in-the-general-direction of identity politics way. You can treat it like an Avatar. Send it off to work on your behalf prejudice-free, with the widest menu possible.

Let your Capital loose