Armchair Economists, Unite!

[Thought]

Regarding your grammatical correction, please do not consider a public acknowledgement of a fault of mine to be a statement against you or your arguments. It would be horribly disingenuous of me to say "oh you are right and I'll change" if I then did not change. As neither of us are leaving the forum, there is a high probability that you'll continue to see my posts. If I said I would change and then did not, my every use of the word "aught" would be an offense. Rather than such insincerities, knowing myself, I admitted that though you are right, there is a small chance that such would result in a change in my behavior.

I suppose there is a degree of hubris in this; it is acknowledging defeat, but also doing so on terms that I get to set (as you noted). Though in this case I can see no way around such if I am to be honest as well.

If it might serve to help underline this point (that is, the unlikelihood of my changing), it might amuse you to know that I pronounce "disciples" as "discycles." Though I know that I pronounce it incorrectly, I find it incredibly difficult to enforce a correction; the mispronunciation slips out far too often (probably still 80%+ of the time). It "ought to be" easier for me to enforce this change, as I have the motivation of very real and very direct embarrassment, than it would be for me to enforce yours. But as I fail there where I feel motivated each time I blush for its use, I suspect with a high degree of certainty that I will fail here as well.

As for concessions, perhaps it is partially because I am quiet in defeat that you haven't noticed. I have made a great many concessions on stances since joining these forums as sparked by debates here. If you would like, I could probably produce a fairly substantial list of such. As for concessions on specific argumentative points, this is much harder to point to specifics, but is inherent in the concession of stances. However, it is true that I do not generally post a response saying "you are right;" perhaps this is something I "ought to" try to do more often. It hasn't been something I have given much consideration to.

And as an aside, if you are curious, I put “ought” in quotation marks in the above because each time I used that word, I typed “aught” first and only later, in editing, caught it.

Our disagreement seems to be a matter of perspective, though, and not one of substance.

Spot on.


Now, then, with all haste I must excuse myself to look over that RPG thread. It should be of no surprise that I recall it differently.

EDIT: Oh, and yes, you are correct in that my own pride and ego do often get in the way of making effective arguments. I am quite prideful, but I do try to work against that. But again, change is quite difficult to enact.

[Thought]

It was asked that I attempt to explain my economic model further. This is the first such endeavor.

However, I would like to ask you, the reader, to forget everything I have thus far said regarding it (if you had read it in the first place). I will endeavor to illustrate my model by displaying the various stages of my thinking that lead me to it. It is my hope that, by following along, you the reader will come to better understand that model. I also hope that the model has sufficient merits so as to cause you to adopt it, but my goal in this is to achieve shared understanding, not persuasion.

Some of what to follow may be more abstract that not, so I ask for your indulgence in that.

That Businesses exist is clear enough so as to not merit further discussion. However, allow me to ask what sort of “thing” is a Business that it might exist? Clearly it is not a plant, mineral, or animated creature. Whatever sort of thing a Business is, it is a human thing; I am aware of no Businesses arising out of the non-human world. So this is a human thing, but what sort of human thing? It is not an individual human, clearly, as no one is born a Business and Businesses do not inherently die when an individual human dies. Business, then, appears to be a human thing that is of a decidedly social aspect (as opposed to a decidedly individual aspect). A man or woman stranded alone on a desert island is not a business but it is possible that where there are two men or women stranded on a desert island, there also a Business might be (to note, this is just a possibility not a necessity). Business, then, is a human social thing.

Why did I bother going through that just to arrive at the very vague claim that Business is a human social thing? That is because Business is not alone in that regard. Starting from as little as possible, we have come to the first point where we can look to other things that are not Business, things that we may know better than Business, in order to find out information regarding Business.

 Governments are human social things as well, as are Religions and other such institutions. “Business” fits into a larger classification. To use taxonomy as an example, “Microsoft” may be of the species “Businessus” but it is also of the genus “Socialis.” This perspective allows us to consider the genus “Socialis” as a whole, identify those elements that are common (or should be common) to all members of it, and then apply that perspective to the species “Businessus.”

This perspective means that a Business must share some similarities with other members of its genus. It is here good to define what some of these other members are:

Governments
Religious Organizations
Social Clubs (Boy Scouts of America being an example)
Institutions of Learning
Academic Communities (such as the Scientific Community, or the Historical Community)
Armies
Discussion Groups (such as the compendium)

I am sure more examples could be found. Now if we look at this genus (excluding Business for the moment) we see a commonality; these social things exist based on the interactions between at least two sub-groups. Governments have those who are governing and those who are governed, religious organizations have the priestly classes and the laymen, the Boy Scouts have the troop and the troop leaders, institutions of learning have the teacher and the pupil, and so on. While we can consider the individual aspects of these things apart from the other, we cannot continuously do so. I can talk about those who govern but if I wish to have a full discussion about government, then I must also inherently discuss those who are governed.

So here we can define a key trait of the genus “socialis;” members of this taxonomical level are comprised of two sub-groups that interact with each other. We may add an addendum that members of this class may potentially be comprised of additional sub-groups, or that these sub-groups may themselves have sub-groups, but that two sub-groups is the minimum.

Now we can take this general trait of the genus and apply it to Business. A Business, then, is comprised of at least two sub-groups that interact with each other. Since we know that these things must exist in a business, we can then look for and identify them. However, as at this point some might object to the steps we have taken on this journey, I will stop for now and request feedback, concerns, comments, etc. Do you disagree with a step we have taken thus far? There is a very far way yet to go, but if there is disagreement here at the start of the journey it is better to address it now.

Josh, having now reviewed that RPG discussion, I do fully and happily acknowledge that my last post in that discussion was of incredibly poor quality; I shall endeavor to remedy that.

[Lord J Esq]

On the whole that was gracious of you, I think.

It would be horribly disingenuous of me to say "oh you are right and I'll change" if I then did not change. As neither of us are leaving the forum, there is a high probability that you'll continue to see my posts. If I said I would change and then did not, my every use of the word "aught" would be an offense.

A high probability indeed. But Thought! It isn't your use of the wrong spelling of a word that matters. It is the persistence thereof while in the knowledge of being wrong. I will return to this shortly.

Rather than such insincerities, knowing myself, I admitted that though you are right, there is a small chance that such would result in a change in my behavior.

While I personally favor defiance over dishonesty (and thus prefer your reasoning here), you did not admit that I was right. You admitted that I was technically right, and we both know the difference. To make it unambiguous, though, you then came right out and said that if you were to heed my advice it would only be for the sake of "technical correctness" and not because of the actual, relevant dangers to English functionality. If it's really a case of you not buying what I'm selling, you can check the claim that ambiguous denotations sharing the same word will tend to result in at least one of them being pushed out of popular use. This is highly evident in its purest form, the contranym, but can be observed all over the place with a good read-through of the dictionary. There are probably even books that focus on this, which would spare you the time and trouble. Someone as well-read as yourself might also benefit from looking at the changes in word meaning between books written in decades past and recent centuries, and those written very recently.

If it might serve to help underline this point (that is, the unlikelihood of my changing), it might amuse you to know that I pronounce "disciples" as "discycles." Though I know that I pronounce it incorrectly, I find it incredibly difficult to enforce a correction; the mispronunciation slips out far too often (probably still 80%+ of the time). It "ought to be" easier for me to enforce this change, as I have the motivation of very real and very direct embarrassment, than it would be for me to enforce yours. But as I fail there where I feel motivated each time I blush for its use, I suspect with a high degree of certainty that I will fail here as well.

It's hard to find sympathy for this. For my entire childhood I miswrote "forest" as "forrest" and "February" as "Febuary," among other things. And I have mispronounced all kinds of words in my day, simply because I encountered most of them in written rather than spoken form. Because of my desire to master the language and to communicate clearly, I reform my errors wherever I encounter them--unless I have a good reason not to. (I recently made a justification to a friend for capitalizing the word Earth when it is used with an article, which is in violation of standard usage.) It's not easy to change something ingrained, but, when the thing ingrained is indefensibly wrong, to change is worthwhile. Essentially here you are saying that some mixture of stubbornness or laziness is what's keeping you from changing, and although I respect the honesty I think we both know that you can do better.

As for concessions, perhaps it is partially because I am quiet in defeat that you haven't noticed.

So noted. I think you've even said this before.

If you would like, I could probably produce a fairly substantial list of such.

For no reason relating to this line of discussion, I'd like to see that out of simple curiosity. Supposing your time and energy permit, by all means please do produce such a list.

However, it is true that I do not generally post a response saying "you are right;" perhaps this is something I "ought to" try to do more often.

That would be helpful to your debate partners, but do not mistake me here: I'm not looking for any tribalistic display of obeisance. I don't need that; I don't even like it. It is a greater awareness and softening of your contrarian style that I seek. In the case of "aught," I was never looking for a "You're right, Josh," because I knew I was right and didn't need to be told it by you. I was looking for you to relent in being wrong on a point in which I knew beyond all reasonable doubt you were wrong, and therein demonstrate your ability to acknowledge defeat from without. To put it another way, even if you do proffer a "You're right" more often, that alone won't placate whatever discomfort it is that led me to this outburst in the first place, because it won't change your tendency of sometimes failing to consider (i.e., be open-minded about, and critical of) your opponents' arguments. We all want to be taken credibly in our assertions, if those assertions have merit, and so I would like to get a fairer shake from you more than I would like to be paid homage when I score a point. I know that I could have been more exhaustive (and clearer, and more empirical) in explaining this "aught" business, but like I said you're a very smart fellow and for my thrust to have gone over your head entirely is just not credible. Thus, it is obstinacy. What does it serve? Well, if you had been holding very specific ideas that were at risk of being lost in the act of accepting my language or premises, your obstinacy would have served that. But you weren't. Rather, you didn't buy what I was selling--like that proverbial negotiator who comes to the bargaining table determined not to strike a deal. Returning to my point at the top of this post, and bringing together my sentiments thus far, you should conclude from all this that what I desire from offering this criticism is for you to enter into debate with a concerted effort to be less quick to contradict and more quick to consider. Have you ever been in a conversation with a person where you are trying to make a point and, once you have said something that stirs a response in them, you can see it on their face that they are barely listening to anything more that you're saying and instead are just waiting to make their objection? How unfortunate!

EDIT: Oh, and yes, you are correct in that my own pride and ego do often get in the way of making effective arguments. I am quite prideful, but I do try to work against that. But again, change is quite difficult to enact.

Yes indeed. Let me tell you a story. I have a very egocentric style of thinking, myself. You can contrast my posts with those of the selfless FaustWolf, who is the ultimate humble peacemaker and would make a very good diplomat or councilor if this is his real style and not an affectation. But, getting back to me (heh): All of my adult life I've had something which sets me apart from most arrogant people. It's not strictly that my philosophy has a lot of integrity. It that I possess my own special form of humbleness, difficult to see as such, but recognizable in my respect for awareness. I am very keen not to commit the mistakes of conceit, not to close my mind to the possibilities, not to get caught up in myself...keen because I witness these flaws all around me all the time in all walks of life. They are case studies of failure in my exploration of power. I can see how egotism invites loss. In you I perceive a desire to maintain your position--in the sense of both argument and social status--which can be greater than your desire for self-enrichment. I expect that, if not for this sentence, you might offer a sentiment along the lines of "I learn by argument." That's fair; I'm sympathetic to people who are cursed to learn through argument, and I try to be accommodating. But here it would be an excuse, not a defense, because it conflates the desire to be honored with the desire to explore an idea in the fracas of contention. Those sound like two very different things, but I suspect they are hard to distinguish. That is the curse: People who learn through argument tend to suffer, not coincidentally, from the very misplaced pride to which you just confessed.

Our respective styles of egocentrism are different, but what is even more different is how we temper our egos. You seem to spend a lot of energy affecting an air of humility which I always suspected was a pure motive wrapped in an insincere attitude, and your Live Journal ultimately confirmed this. I have generally avoided trying to seem docile, feeble, or any of those things, because the very notion is so utterly fake that I worry the heavens would quake with laughter and kill us all with falling stars dislodged from the empyrean. This doesn't mean I don't try to be respectful or open-minded; indeed I try very hard to respect good thinking, new ideas, different perspectives, and emotional need. Instead I temper my ego internally, by focusing on being more aware, on the premise that increasing awareness will increasingly deliver me from illogical behavior. You on the outside won't readily see it; in fact I am well aware that I can appear much less kind and humane than I actually am. This is in contrast to your outwardly uncontroversial, benign posture, Thought. (Do please understand that I am not impugning the sincerity of your friendliness. I have no conclusive evidence either way, but I am very much willing to give you the benefit of the doubt in accepting you as a friendly person. I am referring only to the method by which you temper your ego.)

I temper my ego, then, by trying to be aware of what its nature is and how it would shape me if I were not to flee from my ignorance. I couldn't say what motivates you in your efforts to temper your ego, but I myself am driven in mine by a concern which is nigh inextinguishable, and that concern is to never have to be someone who must be humored. Perhaps it comes from the fact that I was socially awkward as a kid. I wasn't respected then, and I don't want to be fake-respected now. I do want respect, but I want to earn the real thing. I have made this elaborate outburst to you because I noticed, after you refused the other night to say which university you will be attending (which is characteristic of you), that I was on the verge of committing to a decision to humor you in our interactions. I don't want to do that, any more than I want it done to me. I hope you appreciate what I mean here. To me the most crucial supporting pillar of friendship is honesty, and it pains me ever to choose not to be unfetteredly honest with someone due to their personality flaws. Be certain that I would continue to enjoy your presence and conversation even if you do not change, but there is a much better relationship waiting to be developed between us if, in all bluntness, you can get over yourself. Does that seem too provocative? I hope not. You wrote "I am quite prideful, but I do try to work against that." Indeed you are, and indeed you should. I respect that, and I appreciate it. And I understand that it is hard to do. But here, in my sharing all of this with you, you have an opportunity to avoid one of the specific consequences of being egotistical--and I would not be surprised at all if better engagement with me would benefit your rapport with others, too. I hope that my criticism is on the mark, and that my sincerity motivates you toward greater success.

[Thought]

As there were no particular objections thus far, I will continue with our economic journey.

As you might recall, last time I established that a Business is a human social thing, a member of a larger genus. I then listed other members of this genus and identified a similarity that all of those shared, and I in turn said that a similarity of the genus must also apply to the specific species of Business. That similarity being that a Business is comprised of two sub-groups. As I will continue to reference it, allow me to also repost the list of other members of this genus:

Governments
Religious Organizations
Social Clubs (Boy Scouts of America being an example)
Institutions of Learning
Academic Communities (such as the Scientific Community, or the Historical Community)
Armies
Discussion Groups (such as the compendium)

Now there are two possible answers to what sub-groups compose a “Business.” The first is that a Business is made up of the subgroup producers and market; this is an understandable stance to take but it is in error. The Market, at this level, is what provide sustenance to the creature of Business; a lion is different than the rabbit it eats and while to fully understand the nature of the lion we must also understand the predator-prey relationship, when we discuss the parts of a lion we do not discuss the rabbit.

The second possible answer can easily be deduced from an individual’s base knowledge, but allow me to take the long way around and point back to that list of members of the genus. Again we see a common element in each of these groups; one of the sub-groups acts as the leaders and the other sub-group acts as followers. Those who govern direct those who are governed, the priests direct the laymen in worship and doctrine, a troop leader guides the troop, a professor instructs the student, the experienced scientists/historians direct those who are new to the field, and so forth. So too we find that in Business one sub-group directs the other sub-group. Let us call these two groups, then, the management and the workers (please note, for those of you who did read my earlier statements but didn’t forget everything I said, “management” here is essentially the “entrepreneur” I had talked of earlier).

By looking once again to the genus we can also detect a common element in the nature of how the Leaders and Followers of these groups interact. Though the Leaders are in a position of power, it is commonly understood that this power is not to be abused; such abuse results in an aberrant relationship between the two sub-groups and that this is not an ideal state. As this is perhaps not readily apparent in all the presented institutions, allow me to digress a moment to discuss those presented before this gets applied to business.

Perhaps most simply and readily agreed upon in the modern world is that those who govern do so with the consent of those who are governed. Though those who govern have the most power, those who are governed have the right to eject their leaders if those leaders abuse their position.

Religious organizations are a little bit more hidden in this regard, as generally such approaches have not been widely discussed in the modern world. However, as the Priestly class arises from the laymen, the beliefs of the laymen inherently influence the beliefs of the priests. Additionally, as the leaders derive their livelihood from the support of the followers, the leaders must maintain a friendly relationship with the followers so as to maintain their livelihood. A leader who abuses their position can be ejected by their followers.

Boy Scouts is also a little more hidden since one sub-group is comprised of adults and the other sub-group is of minors. However, as minors are always in the care of an adult, so too may their interests be so represented. The caretakers of the followers, then, are capable of removing the followers from a particular situation and they are capable of making an appeal to other leaders for the removal of one particular leader who has overstepped his boundaries.

With learning, again the leaders derive their livelihood from the followers. And so on.

Now, then, we may extrapolate that the management subgroup of a Business is likewise held in check by the workers of that Business. If the leader becomes aberrant, it is within the rights of the followers to address that issue. Thus, though the management has the power in a Business, that power is held in check by the workers.

This principle is essentially summed up in the Social Contract, though here it is being specifically identified as relating to all “human social things.”

Once again we have reached a point where individuals may have objections to what has been said thus far, and so I would like to once again pause and give people time to voice their objections. Do you believe that anything I have said thus far is in error?
 

For no reason relating to this line of discussion, I'd like to see that out of simple curiosity. Supposing your time and energy permit, by all means please do produce such a list.

When I came to the forum I was fairly conservative. I was on the fence of the life/choice debate with a leaning towards being pro-life. I have subsequently come off that fence on the side of pro-choice. I was anti-same-sex marriage, I now support it. I was against teaching the use of condoms and birth control in schools, I now support that. Even more recently I was pro-McCain and anti-Obama, and while my position has not perfectly switched (I am not as pro-Obama as I had been pro-McCain, and I may be more anti-McCain than I was anti-Obama), it has switched. I had been unconcerned with human trafficking before, it is now something that I taken active steps to promote awareness of (still don’t have ideas for effective steps to take beyond that which can help eliminate it). I had been unconcerned with gender equality before, I no longer am. I think there are more examples, but they are not coming to mind presently.

Two less ideological concessions come to mind as well (though again I suspect there are more). Radox Redux corrected my misuse of the word “paramount” (I had been using “paramount” to mean “tantamount”). And then more recently there was my objection to placing the pro-choice standard on what seemed to be to be the unreasonable ground that a “biomass” becomes human at birth; this I maintained as a public position until you, Josh, pointed out that even if it was a more rigorous position in itself (not conceding the point that it was, but for the sake of argument you supposed), it would be detrimental to other pro-choice stances. With such a realization I thus withdrew my objection.

You admitted that I was technically right, and we both know the difference.

Allow me to upgrade my concession, then! You were not only technically correct, you were actually correct as well, correct in the fullest sense of the word.

To note, if I might offer a small explanation (not to be mistaken as an excuse) for why this was so long in coming: you used the analogy of talking to someone and seeing that they weren’t paying attention an account of their eagerness to reply. There is another similar situation, however, that I think better reflects our disagreement. You were talking rather extensively and passionately on a topic that I had no interest in. Actually, I think such a statement doesn’t fully represent the full magnitude of this. To offer an analogy that might help illustrate this point: I like plastics, I like thinking about the nature of plastics, their various properties, their various glass-transition temperatures, etc. When you were arguing so exhaustively and diligently in this manner, I was as about as interested as VP Joe Bidden would be if I cornered him on the train and started to tell him about the different qualities of polyethylene and polypropylene. If I was contrary in this regard, it was a passive contrariness. You were unable to persuade me just as I would be unable to persuade the VP that polypropylene should replace polyethylene for tupperware containers. The interest of the individual must first be engaged before that individual can be persuaded.

What changed? You dogged persistence in discussing this matter finally sparked an interest, and so I could then be persuaded.

As an aside, if you are curious as to why I keep putting these comments in a smaller font, it is to help distinguish them from the main discussion and theme of the thread.

[FaustWolf]

Wow, in some corners the phrase "Great Depression II" is being used. I'm very surprised at the (as far as I can tell) prevailing reaction to the US jobs data: +25,000 jobless claims last month. Where's the army of Neoclassicals who are supposed to trudge out and wave their hands, telling us it's a good thing, because marginally attached people are being inspired to re-enter the labor force? It's not reasoning I necessarily agree with, but that's usually what they say, and those voices have a major role to play in the "animal spirits" that seem to drive the New York Stock Exchange.

I mean, we're supposedly in a recovery here, so I predicted the talking heads would pull something like this:


Economists: We predict unemployment benefits claims will fall, which means the economy is growing! It's a recovery!

(US jobs data show that claims on unemployment benefits rise instead of falling as predicted)

Economists: Ah, well, the economy's growing, so those unemployment benefits are being claimed by people who weren't looking for work before, but are now looking for work because businesses are hiring! It's a recovery!


Such a rationale would hinge on the requirement that one has to be looking for work to receive unemployment benefits. I think that's how it works here in the US -- anyone know offhand? We talk about this precious little in economic theory classes (go figure), so it's a matter of policy you have to experience firsthand to get a proper feel for how it works, not to mention, to get a feel for what's really going on beneath the surface of the data. The fact that economists aren't trying to spin the news positively has left me with an unsettling, eerie feeling. Good thing I don't have stock in my hands, or I'd probably sell it! Mwahahah! Ah, that was morbid of me. Sorry.

[FaustWolf]

Harumph! It takes a lot to get me riled up, but this will do the trick:
"Out-of-work job applicants told unemployed need not apply."

It speaks to a wider truth in this economy: companies aren't so much concerned with putting available resources (including human capital) into productive use as they are with weeding out everyone they possibly can. From the micro perspective of each company this might make sense, but on the macro level it produces mass unemployment. An unemployment rate of 9.7% is much bemoaned in the media, but in truth it's only a few ticks up from the "natural" unemployment rate of 4~6%, which varies over time and with which economist you ask.

I feel all this talk of a "natural" unemployment rate is only a psychological nicety economists have developed for themselves so that they can ignore structural inefficiencies in our current system and sleep soundly at night. We need not just government stimulus, but government-funded structural change. Some mechanism for taking stock of what skills lie in the great pool of unemployed and how their skillsets can be utilized.

Robert Reich recommended (tongue-in-cheek, I'm sure) hiring all the unemployed to clean up the BP oil spill. This isn't a bad idea, but still a hamfisted approach to what is essentially public works projects. I think we can do better than that, using the Internet as a microcommunications backbone to find out exactly what each locality's needs are and organize currently unemployed resources to meet those needs as closely as possible.

[Lennis]

As you might recall, last time I established that a Business is a human social thing, a member of a larger genus. I then listed other members of this genus and identified a similarity that all of those shared, and I in turn said that a similarity of the genus must also apply to the specific species of Business. That similarity being that a Business is comprised of two sub-groups. As I will continue to reference it, allow me to also repost the list of other members of this genus:

Governments
Religious Organizations
Social Clubs (Boy Scouts of America being an example)
Institutions of Learning
Academic Communities (such as the Scientific Community, or the Historical Community)
Armies
Discussion Groups (such as the compendium)

Now there are two possible answers to what sub-groups compose a “Business.” The first is that a Business is made up of the subgroup producers and market; this is an understandable stance to take but it is in error. The Market, at this level, is what provide sustenance to the creature of Business; a lion is different than the rabbit it eats and while to fully understand the nature of the lion we must also understand the predator-prey relationship, when we discuss the parts of a lion we do not discuss the rabbit.

Now, then, we may extrapolate that the management subgroup of a Business is likewise held in check by the workers of that Business. If the leader becomes aberrant, it is within the rights of the followers to address that issue. Thus, though the management has the power in a Business, that power is held in check by the workers.

I'm not sure I want to get involved with this, but I'm sensing a problem with the structure of your argument.  Everything you've been discussing has been in the context of the relationship between leaders and followers.  I'm not sure that argument works when discussing the nature of business (though in fairness you really haven't gotten to that part of your argument yet).  It's more complicated than that.  Who are the leaders and who are the followers?  You could say that management takes on the role of leadership, but in business the decisions of management are largely dictated by market forces.  If the market says that product A has run its course and would rather see product B, does management disagree and keep making product A?  If they did, the business would quickly lose financial strength and might fail alltogether.  The argument could then be made that the market is in the real position of leadership, and the management are the followers.  But then you would run into the problem of actually making the product.  The market often doesn't really know what it wants or how to make it, it only has a vague notion.  So it falls on management to develop a product that the market may be unsure about and might reject completely.  Does that put management in the position of leadership?  It's difficult to say who leads whom in business, and this isn't even taking the labor question into account.  Assuming that the worker is the real follower, how much power does he really have to affect change in leadership?  Labor laws differ from country to country, and a strike may not be a legal option.  The workers could simply quit for good, but that would be an impractical solution - especially in an economy where jobs are scarce.  This isn't really the issue, however, since I don't believe the worker is the real follower in this dynamic.

You say that the management are the leaders and the workers are the followers in business, but this relationship is fundamentally different from some of the other societal institutions you mentioned.  By itself (meaning as a self-contained entity) the business serves no real purpose.  Management cannot propose products for the workers to build if there is no market to tell them what that product should be.  And the workers cannot build products unless there is a market to sell them to.  Therefore, the business cannot exist by itself.  Contrast this with governments: you have those who govern, and those who are governed.  That is a self-contained entity.  It can function by itself without an outside force telling it how.  The same thing applies to organized religion and social clubs, who - functionally speaking - provide exactly the same service: a place for like-minded people to organize and share insights.  There are those who organize, and those who are organized.  They do not require an outside force to function.

Armies are another thing that don't really apply to the strict leader - follower dynamic you're describing for societal institutions.  You can have officers dictate how wars should be fought (the leaders), and soldiers who carry out those policies (the followers).  But without a territory to defend or enemies to attack (which is determined by a government - i.e. an outside source), an army serves no purpose.  It cannot exist as a self-contained entity unless that army also serves as a government, in which case the govern - governed relationship would then apply.

I guess what I'm saying here is that you're trying to build your argument by finding similarities in social institutions that aren't really that similar.  I'll gladly accept intellectual chastisement if you think my thoughts violate the spirit of the argument you're trying to make, but you might want to reconsider the foundation of your hypothesis.

[Lord J Esq]

That was probably the most thoughtful post on the Compendium this month. Well done, you! I give you the Lord J Earl Grey Award for Cogitation to a T.

[Thought]

Thanks for the very thoughtful reply, Lennis; it is always hard to see the flaws in one's own argument, so thank you for the input. Please, allow me to think upon this over the weekend, to try to ensure that my reply is as thoughtful in turn.

[Lennis]

I appreciate the kind words.  Being an Earthbound, I was afraid I would trip and fall on my face. 

[FaustWolf]

Awesome site where you can see unemployment county-by-county in the US. I wonder if there are similar sets of data for other countries.

[Thought]

Thanks again, Lennis. Anywho, the time has come for me to formulate a reply to your post. But first, please allow me to confirm that I am understanding your position correctly. It seems that you have two major points, as follows: 1) the follower/leader dichotomy is too simplistic, 2) business is different than my other examples (government, religion, social clubs, etc) because it isn't a self-contained entity and they are.

Is that a fair assessment? If not, please let me know and the rest of this post can largely be discarded as the product of my misunderstanding.

But if it is, then I would agree with you to a point. The follower/leader dichotomy is simplistic; the relationship is more complex than that. However, I think this is the product of trying to build up a more sophisticated perspective on business. Who are the leaders and who are the followers? In reality, often these groups overlap and are greatly diversified, but for getting a better understanding of the structures it can be useful to pretend that they are separate, distinct entities.

Additionally, this perspective is fairly idealistic. Social Contract theory generally claims that those who govern do so with the consent of the governed. However, it is utterly foolish to think that every member of every nation has a say in its government, or that every government to have ever existed came about due to the will of the people. Rather, the Social Contract theory is a way of explaining how proper governments and organizations might be formed. In the same way, there are indeed businesses that exist today in which workers can’t be classified as followers, nor management as leaders, especially not in the way I am using these terms and the interactions they imply. My goal is not to describe what exists but rather to describe how things should be in a civilized society. This is much in the same way that I might describe the proper behavior of a citizen while there are many citizens in the world who do not behave in that manner.

So to summarize, regarding your point #1, I agree that it is too simplistic. But I would counter by saying that simplicity is necessary and prudent at this stage. However, is there another reason, beyond the high degree of mixing, that you think this dichotomy doesn’t work?

However, you brought up markets, which I haven’t yet addressed, and you went on to mention that businesses are not self-contained entities. The third installment of my monologue here was to actually address this very point, so thank you for giving me such a splendid opportunity to expound upon it. The Follower/Leader dichotomy is too simplistic partially because it is ignoring the outside world. Yes, businesses are not self-contained, they need the market. To use an animalistic analogy, the Follower/Leader dichotomy is essentially a discussion of the relationship between the body and the brain, but of course the whole animal body can’t exist entirely on its own means; it needs to relate to the rest of the world as well. There is the internal dichotomy of Follower and Leader, but there is also the external dichotomy of the organization and “the other.”

I hope you will forgive me for being amused, but my argument for reaching this dichotomy is very similar to your arguments as for why business is not like government. That is, I am once again extrapolating from other human social institutions and applying those principles to business. You stated that Government, Religion, and social clubs are self-contained. I must reject that assertion; they are not self-contained in the least. If businesses are not self-contained, then that actually helps establish the similarities with these other organizations.

In a government we have those who govern and those who are governed. However, if it were just those two groups, then actually the first group wouldn’t be needed, as the government would dissolve. I think we would all agree that a government is not merely laws, but also the thinking actor behind those laws; government creates laws, but it also revises them, enforces them, etc. If there was a single populace of those who are governed with a law code, then there would be no need for those who govern since they would have no duty once the laws were established; the citizenry would follow those laws, as per their commitment to the social contract, that that would be that. This is not how things happen, of course. People break laws and so those who govern exist in order to arbitrate between those individuals and the citizenry. Breaking a law is the same as a person saying that they are not bound by the social contract, that they exist apart from the rest of society. The government attempts to reassert the laws by capturing the criminal and putting them through due process. If no one ever tried to leave the “those who are governed” group by disobeying the laws, then there would be no need (in this regard) for there to be “those who govern” in order to arbitrate between the governed and this “other” group.

Government doesn’t end there, however. Governments often also regulate business practices. Even if a business is comprised of members of the “those who are governed” group, the business itself isn’t such an entity. A business does not have the same rights as an individual who is governed, it does not cast a vote, etc. Though it can be comprised of the citizenry, it is not itself a citizen and it is not bound by the social contract. The government arbitrates the interactions between the citizenry and this “other” institution. This is all the more true of international businesses, where the company is not even comprised of the citizenry of a particular government. Of course, governments also interact with other governments and religions and other organizations. No, a government is not self contained; if it were, it actually wouldn’t be necessary. A government exists to arbitrate between itself and “other” institutions.

So too is it with a religion. A religion is comprised of the priestly class and the worshippers, but that does not end there. Religion is specifically intended to be a way for people to interact with a metaphysical universe. For many religions, this even takes the form of the religion interaction with their god, though there are religions in which the metaphysical focus is more abstract. It doesn’t matter if you reject the notion of the divine; the people in the religion do not, and so to their perspective they are interacting with an “other” entity. Of course, many religions also don’t exist perfectly in the natural world, and so the world that is could be said to be an “other” entity that it must interact with, as well as other religions and institutions. No, by its very nature, religion is not a self-contained entity.

Social clubs? I think I had used the Boy Scouts of America before, so allow me to use them as a specific example again. In particular, I would like to draw your attention to their oath: "On my honor I will do my best to do my duty to God and my country and to obey the Scout Law; to help other people at all times; to keep myself physically strong, mentally awake, and morally straight." The BSA is a social club designed specifically to interact with individuals outside of that group.

But perhaps the BSA are an anomaly? What of other social clubs? I think we could call Hollywood's Magic Castle a social club, and a very private self-contained one at that. It seems rather self-contained, yes? Attendance is by membership or invitation only. Ah, but even though the group may seem private, it serves a public function by promoting young talent; many individuals in the Junior Group go on to become professional entertainers, who fundamentally interact with those outside of the institution. This function of the Magic Castle isn’t to merely serve its own members, but to interact with those outside of the organization.

The Society for Creative Anachronism? No, they desire to put on reenactments for the public and generally promote knowledge of their favored time period. They are not self-contained.

The Democratic Party? Nope, they interact with the government and swing voters.

And all this brings me to armies, which as you noted are not self-contained. They rely on governments to direct them (or they create their own governments). And, of course, they interact with the “other” entity called “the enemy.”

Every human social institution I can think of, both of general types and specific instances, exists not only as an interaction between the leaders and followers, but between the organization and “the other.” Since it exists in all other instances of the genus, I think we can apply it to Business as well. You already identified it as the Market.

So to summarize, regarding your point #2, I would agree that business is different from the other organizations I have mentioned, but not in this way. They are all similar enough to draw out important concepts that can be applied to economics and business models.

People often approach business as some unique, alien artifice. The behave as if what we know about people as they interact in governments, as they interact in armies, as they interact in religions, does not apply to business. There are very important differences between these organizations, just as there are many important differences between me and you. However, there are a lot of potent similarities as well, similarities that allow us to live in the same world together, to use the same medicines to the same affect, etc. So too, I am claiming, with business.

People treat business as if it were not a human institution. I am arguing that no, it is a human institution; people don’t stop being human when they enter into a business. They’re the same creatures, so the same concepts that exist in other human institutions apply to this one as well.

Generally, I find modern perceptions of business to be rather medieval. People seem to approach them with the same assumptions that nobility approached government just a few hundred years ago. I am hoping to bring our thinking about business into the modern era.

[FaustWolf]

Another great article on the phenomenon of the unpaid internship. This is a huge, huge, deal in the US economy. I haven't seen data on it though, like how many internships are paid vs. unpaid; gotta start sniffing for some.

[FaustWolf]

This was really interesting: Chicago Sun Times columnist chides girls for operating a free lemonade stand.

My question is: Were the girls so very wrong, indeed? This is ignoring the larger question of whether the Sun Times columnist justifiably extrapolates their behavior to US government policy. I'm interested in the sustainability of that one lemonade stand. One could imagine that their parents or a Girl Scouts of America chapter gave them the materials for free, but somewhere along the line money was injected into the equation. What does it take to peel that "somewhere along the line" back further and further, until we're operating on the kind of economic system Captain Picard describes in Star Trek: First Contact?

A Hollywood writer's pipe dream as expressed in movie dialogue, maybe. But I have to stand back in awe, thinking about how these little schoolgirls - without a day's training in economic theory, as the columnist would have us believe - successfully eliminated one link in the giant chain that keeps things the way they are. How easy it is, and how hard.

[Lord J Esq]

Wow. Okay, first of all, the columnist makes a good and under-appreciated point. Second of all, I'm not sure she could have picked a lousier example to make that point. She rolled down the window--couldn't even get out of her car--to chew out those little kids? Then proudly reported it to the nation? That's Three-Star Assholery right there.

I see this happen to columnists. As time wears on, they get constrained by the limitations of their worldview and the quantity of topics they've written about in the past. Rather than repeat themselves, they become progressively more extreme, eventually to the point of becoming a parody of themselves without even realizing it. From her point of view, Savage thinks she's being cheeky, but what she's really being is a Three-Star Asshole.

Out of five, if you're wondering. The "Lieutenant General" rank of Assholes.

But it is a good point. A lot of people seem oblivious to the fact that private businesses are supposed to make money, or at least break even. This economy won't run on t-shirt sales. I wish our friends on the right weren't such hideous exemplars of everything that's wrong with capitalism, because it turns people off to the incredible vitality of private enterprise as an economic engine.