Freer Economy

If the problem with Managerial Capitalism is its ineffectiveness, then how ineffective is it? And how do we measure ineffectiveness anyway? Well, they pay economists way too much to worry about this stuff, but they’re usually wrong anyway, so why not have a go at it?

Flemming Funch, as usual, has wisdom to offer on this point, and calls it Free Economy. What else would you expect from a site declaring, An old rigid civilization is reluctantly dying. Something new, open, free and exciting is waking up. He suggests that more abundance would be developed if people and companies concentrated on making their stuff free. It’s a fair point. Even though companies don’t have a stated goal to make things more free, that’s the obvious effect of managerial capitalism. Perhaps if freer stuff were their conscious intent, companies would do even better with their stated goals of market share, profitability and stock price.

If I look at the resources available to me, and I identify what I can freely share with others, and I work on increasing the number and variety of resources I can freely share, and others do the same, then we’d gradually be getting somewhere. Somewhere where a lot of what we need is freely and easily available for everybody. I’m not talking about whether I might take time out of my schedule to work hard for some charity once per week. I’m not talking about sacrifice. I’m talking about arranging things so that it is perfectly feasible and comfortable to give something away, without particularly being worse off myself.

The production of goods and capital is so efficient in the so-called first world that we’ve already achieved a lot of this, compared to the so-called third world. Take salt for example. Salt was so precious in the ancient world that Roman Centurions were paid in little bags of salt, not coins. It was their salary. They were said to be worth their salt. We’re already well down the road to free stuff and constantly prove that what is dear under one system is abundant in another.

Perhaps the core problem is philosophical or spiritual: we tend not to value what isn’t dear, so we don’t celebrate the abundance we already have. Or, paraphrasing Einstein, We pay attention to the things we can count but which don’t matter, and we ignore what matters but cannot be counted.


So on Monday I was in the middle of riffing the above from Flemming Funch, the Masterful Ming, and I go to his site to check a detail, and there’s this embarrassing (but oh so welcome, give me more) admiration of my last post in his Inspiration category. I’m honored that he finds these rants reminiscent of the writing of John Perry Barlow, whom I quote repeatedly, and so should you. Barlow and I are both alumni of Wesleyan University in Connecticut, so maybe there was something in the water (I’m embarrassed to admit that I discovered Barlow only when I saw him on the cover of the alumni magazine.) He arrived the fall after I graduated, about the time I was swearing in at Dubya’s and my favorite USAF recruiting station in New Haven.

Here’s a sense of Wesleyan. A few years ago, I was visiting my favorite professor, George Creeger. I had been one of George’s series of student “slaves” who helped him restore 19th century houses and do odd jobs. More than most, I hung out at his home with George and Elva and Katie, Karl and Kit on summer evenings after my construction job. During this last visit, he pulled a book off his shelf and handed it to me. The book had been given to him by its author, another of his former students, and George thought perhaps I’d enjoy it. Which I did. The book was The Perfect Storm.

In the halcyon early 60’s, anything was possible, and Wesleyan was the epitome of that open potential. We were at a social turning point but didn’t realize it. Still an all-male college of about 1100 students, Wesleyan had the highest endowment per capita of any college on earth, a liberal arts curriculum that may not be reproducible today for any amount of money and a student body simultaneously adventurous, well informed but intellectually curious and willing to party on any occasion. My freshman dorm counselor was Bruce Corwin, my teachers, in addition to George Creeger, included Richard Wilbur and Norman O. Brown. I sat with Vance Packard at a fraternity dinner, because his son Randy was one of our pledges. I’ll spare you the prank played on them that day by Jim McInteer, who later took tea in Taos with Lady Brett just for the hell of it, pretending to be writing a thesis on D. H. Lawrence. While there, an authentic scholar called from town requesting an audience, but Lady Brett demurred, since she was having such an important talk with McInteer, the merry prankster of scholars. But at least Jim knew why Lady Brett was significant.

Just Give Us the Goods

OK. Back to our knitting. How do things improve, economically? I suggest that a key attribute of a successful economy is the Delight factor. That’s not just a New Age neologism, but an attempt to name the difference between what you pay for something and what you would have paid if you’d had to. In a freer economy, we’d expect the delight factor to be higher than in Roman times.

The secret of productivity is that experts can produce something for less than someone else will pay for it. But there’s always some other additional value. Economists talk about friction-free markets, where every seller and buyer is perfectly informed and everything is sold for exactly its fair market price. But the dismal scientists ignore the Delight Factor, where the buyer so relishes the transaction that the price is still not equal to its worth.

There’s not a lot of delight in commodities, but service-based products have the potential to delight and amaze the buyer (Midwest Express Airlines‘ wide leather seats and free champagne) or not (Sprint PCS‘ nonexistent customer service and, often, signal). What agency will help us grow the Delight Factor and, perhaps, our economy?

From The Peer Economy:

Corporations’ inability to keep people profitably on task is the key to the demise of the C
orporate Age. If you want to see people on task, stop by your local cleaners or bbakery. That’s where you find people who are close to their customers, sticking to their core competencies. They are blissfully unmanaged by overly creative managers dreaming up new line extensions to fritter away shareholder equity and their customers’ time.

The question is, how could the marvelous productivity of localized business become the engine of the next wave of democratic wealth? It happens when the global communications links forged by corporations serve the sole proprietor as well as the multinational corporations and interactive TV spuds they were designed for.

A ubiquitous Internet, unmediated peer-to-peer payments and eXtensible Markup Language (XML) are the building blocks of the Peer Economy, where you transact directly with another and not their company, although you’ve never met nor will, each with absolute confidence in your security and total satisfaction. The Peer Economy provides mechanisms for wealth creation which cut across corporate borders and are aggregated in the very fabric of the Internet, not locked inside the balance sheets of contending companies and mutual funds.

So, if great granddad toiled in the old country for half an hour for the loaf of bread you earn in one minute, when will your child work 10 seconds for her bread? It happens as soon as the means of production are on task six times as much (usefully tasked, as defined by consumers, not managements). This includes people in addition to the robots and computers staffing the impending golden age of automated slavery.

The point is not how many slaves we have, it’s how much they and we are deployed on tasks which are truly useful to each other, unmediated by clueless managers.

Do we really ask anything more of each other than that, for the moment we serve, we be truly on task? Delight is the result of being paid attention to, not commoditized into consumerism.

12:34:53 PM    

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