Ideas in the Open

I have mixed feelings about Intellectual Property. I think we would be better off if we did our thinking in public. Open to the error correction of a million eyes, if what we are doing is worth their attention. Property allows investment. You can ring-fence the rewards.  It also restricts the knowledge to a smaller set of people. We don't always know what connections our ideas will allow others to make. We all see the world differently. In a world with zero transaction costs, perfect transparency, and the ability to replicate anything that has been done before - the rules of reward based on ring-fences will fall away. We will have to switch the economics of scarcity for the economics of abundance. The only thing that can't be copied is human relationships. Trust. Time. Context.

Fences

Self-Made

Who invented Calculus? Newton or Leibniz? Who first thought of Evolution? Darwin or Lamarck? At most, our individual contributions nudge us forward pulling together the thoughts we have had cumulatively. No sharp rock, no fire, no numbers, no language, no society... then no Calculus or understanding of Evolution. We love the idea of being self made, particularly if we had trying circumstances when we were young. These make great rags-to-riches stories but miss the point. GDP per capita in the UK was less than £2,000 up till the middle of the 19th century, then exploded up. A coming together of ideas empowered people born in the place which the Industrial Revolution ripped from being a backwater. Still today, we like to believe we are essentially special. We have something no one else can provide. The only thing that is true of, is emotional connection. Everything else can be found elsewhere. No one is self-made. We don't need any individual. We do want them.

Merit & Nudges

'A pretty reliable rule is that everything you think was invented somewhere other than China was probably invented in China' (Tim Urban). Part of the enlightenment and humanism was the raising of the individual, and crediting people with merit rather than divine rights mixing feudalism and religion to entrench hierarchy. Mostly good. Except most of the credit for what we do IS hereditary. It just doesn't belong to any individual, or because of any bloodline. Social Capital - the tools at our disposal like language, money, laws, professions, science - is cumulative with each generation nudging it forward. Our personal merit is tiny. A thin slice that is mostly the connecting of other people's ideas. No one, ever, was or will be self-made.

 

Playing Live

One massive change brought about by communication technology is the ability of decisions, and control, to scale. Senior executives earn way higher than front line workers now, partly because the workers are paid their cog value, and partly because a decision, made once, can be replicated. A musician who can record something once, but keep 'Intellectual Property' over it can make far more than someone who only plays live. Labourers play live. In a world that is perfectly transparent, and where it is easy to replicate whatever anyone does, the only control those at the top have is property rights. Those have become easier to enforce (for now). In the past, there had to be delegation of control, and reward, because of distance. Communication technology changed that (for now). In a world where everything you can do can be copied and repeated immediately, the power will shift back to playing live. The real value people add isn't in doing things a second time. It is in relationships and creativity. It is in being present. You can't replicate that.

Making New Mistakes

Don't talk about Religion, Politics or Sex. Don't mix friendships and work. Barriers start to become harder to enforce as information starts to flow freely. They also become harder to enforce when the people around you don't come from the same place, look the same, have the same broad beliefs etc. We spend so much time at work that if we don't share something of ourselves, there is the chance that you lose it. You end up spending significantly more time at work than with your friends and family. The things that really define you in your eyes become the things you don't talk about with the people you spend the most time with. Professor of Business Ethics at NYU-Stern Jonathan Haidt (@JonHaidt) studies the intuitive foundations of morality. His work is trying to find the common ground that we can't find through rational thought. He is the one who came up with the Elephant-Rider metaphor I love so much. In The Righteous Mind he looks at why good people disagree. I think it should be prescribed reading for politicians, religious leaders or anyone who is attempting to steer a path towards improving peoples lives.

San Francisco seems to be at the epicentre of one of these clashes of people trying to figure out how to reconcile conflicting ideas. Getting more involved with Twitter recently (@trevorblack), I am amazed how many American's define themselves very strongly in their profiles as being Anti-GOP or Anti-Democrat. I am sure those are just the noisy ones, and there are more silent pragmatists in the middle. America has conquered a lot of the big ticket barriers to liberty and so these points of common ground are forgotten. California is very Democratic but is right at the front of some very cut-throat Capitalism.

'If he had not become a Communist at 22, I would have disowned him. If he is still a Communist at 30, I will do it then.' - Clemenceau talking of his son

The heart of Capitalism is a recognition that we don't know how to price things because we all want different things and there isn't enough to go around. Enter Adam Smith and the theory of the invisible hand that helps us out by with supply and demand. The price of something has nothing to do with the effort that was put into making it. It has to do with how much there is of it, and how much people want it. As it turns out this is a really effective way of driving resources to where in reality they are most wanted.

In doing this though there are incentives to affect both supply and demand. In 'Hide & Don't Speak' I spoke about how appealing the idea of collaborative work is. The Netflix documentary on '3D printing' looks partly at this idea and the conflict between Open Source and Proprietary Development. This is a conflict between our romantic idealism and the competitive fuel that keeps us running. The documentary is also an interesting look at some of the other areas of conflict in the capitalist approach. One interesting one is how an employee can invest themselves in a company and receive payment and at some point be thanked and asked to leave. The rationalist in us believes they have been paid and that exchange means all is fair. We don't account for the unpriced/unpriceable part of themselves that they lose. It doesn't just happen to employees (although that is most common). Steve Jobs was famously ousted at Apple. Bill Gross has left PIMCO in the last few days after around four decades.

We aren't purely rational. In the Ultimatum Game, the first of two players is given a sum of money to divide and the second player can either reject or accept the offer. If they reject it both get nothing. In a rational world, the first player would offer a tiny amount and the second player would always accept a non-zero number. This isn't how the game is played by real people.

It is tempting to see our rational sides as the masters of our destiny and believe that by calming our emotional side, we make better decisions. In a world where the other players are people, I don't think that is the case. All this directly ties into our happiness and how we choose where to work, what work to do, who to work with, whether we want to grow, how we want to grow and what to believe in.

I think the work that Haidt and others are doing is fascinating. I also think looking at the stories of the successes and failures of others is a great way to avoid having to repeat the mistakes of others. We get to make new mistakes. You don't have to, and in fact can't, go it alone.