Author: ruminathan

An alien, observing a soccer pitch from above, might come up with the following theory: The soccer ritual is an elaborate dance, where 22 dancers collaborate to keep a small globe moving rapidly around, but never leaving, a rectangular field. After all, as soon as the ball exits the rectangle, the dance stops, one of three or four re-entry rituals occur, and the dance begins again. The theory describes what goes on and could be used to generate certain predictions. For instance – and here I’m going out on a limb, but I’d be willing to bet it’s true – the “best” and most prestigious dances – those observed by hundreds of millions of the Earth creatures – have relatively few interruptions. In the lowest – those observed by none or very few – the globe escapes the dance-floor much more frequently. The particular case where the globe exits between a kind of gate into a net is a puzzling complication, but it happens so rarely – especially in the high-prestige dances – that it can’t possibly be of great significance. Sometimes it doesn’t even happen at all.

An interesting theory, and illuminating in its way. A soccer game is a highly cooperative activity even between the two sides: they have to agree to show up at the same time and play by the same rules. And the movements of the players, individually and as a collective, are often graceful displays of the human body’s potential, just like a ballet.

Still, the theory kind of misses the point, doesn’t it?

I have long wondered how much time and attention I should spend on Marxism. I am interested in the capital return: Why it is possible to earn money simply for already having more than you need? Shouldn’t I investigate the historically preeminent alternative to our current way of organizing our economic relations? But Das Kapital is a bit daunting. So I deeply appreciated it when an acquaintance sent me his master’s thesis about an up-to-date reinterpretation of Marx by Moishe Postone. I had hoped it would be a kind of Cliff’s Notes on the Cliff’s Notes of Das Kapital, and that reading it would help me decide whether to take the plunge.

In that regard, the well-written thesis served my purpose, and it’s spared me a lot of trouble, for now at least. In short, Marxism seems to me beside the point as an economic theory, in the same way that the dance theory of soccer is beside the point.

In no way is this disparaging of my friend’s admirable work, nor of that of Postone. And certainly not of Marx, who, in his time, recognized a lot of the deeper structure of what was going on and that his contemporaries were overlooking. But I have to decide where to spend my limited time, and my admittedly and necessarily cursory glance has thoroughly discouraged me from spending it here.  

In the following I will channel the Marxian view, doubly indirectly: via my friend’s thesis, via Postone. I will refer to the “Marxian” view, hoping that you, the reader, keep in mind that a) my purpose is not to take down anybody, but to nicely set up an important piece of the puzzle as I answer my big question, and b) anyone may be misinterpreting the previous person in the chain. Feel free to attribute all misconceptions to me and me alone.

Here’s my rough-and-ready understanding of Marx: In a capitalistically organized society, there are those who exchange a commodity for money in order to be able to exchange money into a different commodity (C to M to C). Ultimately, what is being exchanged is the labor it takes to produce the respective commodities; that is what has given the commodities their value. People engaged in this form of exchange can be called the laboring class. There are others who exchange money for a commodity, then sell that commodity for a strictly higher amount of money (M to C to M’ where M’ is greater than M and M’-M can be called “profit”). Insofar as they do not immediately consume all of the difference between M’ and M – which would be the case if they were simple retail merchants, who would really be performing a service and so would actually be exchanging in the form “C to M to C” – we refer to those performing this kind of exchange as capitalists. The value added that allows for the profit had to be generated by labor and is not due to anything the capitalist contributed. In this sense, the extraction of profit is exploitative, although it’s not clear that Marx actually condemned it.

There’s nothing wrong with this description in the same way that there’s nothing wrong with looking at soccer as a dance with a ball within a rectangle. The all-important part it overlooks is that it’s possible to contribute to value creation – call it “work” or “labor” if you like – in three structurally different ways, and there is no straightforward uniform way to fairly compensate people for those differently-shaped contributions.

Consider tilers, firemen, and songwriters. A tiler can bill me based on square meters of floor tiled. Simple enough. But would we pay a fireman in portion to the number of fires he puts out? That seems obviously not the right way to go, if only because, ideally, there would not to be any fires at all. But then there would be no way to make a living as a fireman, in which case we wouldn’t have one if did need one. We pay firemen to be available. There is an overlapping consideration of incentives (a fast tiler can make more money than a slow one; we do not want firemen turning into arsonists). But even looking beyond incentives: It’s easy to compensate a tiler in proportion to how much value she contributes, but that’s not as clear with the fireman.

What about the songwriter? The songwriter may spend half her life before practicing and writing something that resonates enough with others to waken their desire to hear it again and again. She may succeed only once and nevermore. It’s entirely unpredictable when that key moment of inspiration will come, and it may never come for some who try to walk that path. Before and after lightning strikes, she needs to eat. So when it comes, she needs to make hay while the sun shines, which also means she’ll need a mechanism for storing that hay until the next time a composition happily converges with the zeitgeist.

How do you compensate those whose noticeable contribution comes in enormous bursts at unpredictable intervals? What mechanisms do you put in place so that they can reliably provision themselves before and after those bursts? And how do you compensate those who spend their time preparing to make a contribution during an event like the fire: one that not only might not happen, but that ideally never happens?

The fact that we can contribute to value creation in very different structures seems central to the question of how that value gets distributed fairly. A social contract that involves an ever-ramifying division of labor will lead to specialists whose contributions are heavily weighted towards one of the structures. Those specialists have to find ways to trade their differently structured contributions with each other.

An economic theory that ignores these facts cannot adequately explain the capital return, let alone question or defend it.  Maybe Marx raises this problem somewhere in his work, but he’s certainly not famous for doing so. One hundred and fifty-odd years later, there are too many other important works on political economy to spend time on one that doesn’t place these issues front and center.

At the recommendation of a friend, I watched the short German series Schlaf Schafe (best rendered as “Sleepy Sheep”). Its premise is that a family implodes as the mother descends into Covid-related conspiracy theories. It’s a dark comedy, and it takes a clear position against those theories. But the mother is portrayed sympathetically: Her motives are intelligible, even relatable. You can recoil from her actions and reasoning, but her heart is in the right place: the same place as yours.

Schlaf Schafe resurfaced one of the running themes of the Ruminathans: the right and wrong of how we communicate with each other. Specifically, how we choose to receive messages. The question the series raised for me is whether there are messages that we ought to disqualify from being entertained even before we consider their factual accuracy. Is there something about the structure of certain narratives – conspiracy theories for example – that requires us to disregard them without considering the arguments in their favor?

My question rests on (at least) three assumptions:

1. We are so bombarded with information and narratives that we cannot possibly entertain them all and have to triage them quickly into “ignore” and “consider” piles.
2. There is a “right” or “wrong” about how we choose to receive messages.
3. Ethical criteria can take precedence over logical and empirical criteria for deciding which messages to ignore.

The first assumption probably isn’t controversial, but the second and third probably are. They are worth several dissertations each, not counting all the debates about the basis of ethics. About the second assumption let me say only this: I think we have left the question of our responsibilities as receivers unexamined, and overemphasized the ethics of sending signals. When I say we have responsibilities as receivers, I mean that we ought to practice information hygiene not only to protect ourselves from harmful narratives but also to protect those around us.

Regarding the third assumption: There are obviously many criteria we can use when triaging information and narratives, but clearly they have to be criteria that aren’t fact-based, at least for sufficiently complex narratives: We have to decide in advance whether we should devote time and energy to a narrative, before weighing its merits, which is precisely what would take up time and effort. If someone tells me “two plus two equals five” I can still rule that out immediately. But if someone tells me that “Euler’s number taken to the power of the imaginary unit times pi equals negative one,” I can rule that out of consideration because it is irrelevant to me at that moment. (It happens to be true.) I do not need to spend the time to prove or disprove it myself, or check the credentials and trustworthiness of whoever is sending me that piece of information. So “relevance” or “interest” are criteria that we apply routinely under the bombardment of information. I see no reason to exclude ethical criteria when we triage narratives, as long as we have criteria that lead us to a quick decision and don’t suck us into giving the narrative serious consideration.     

Are there ethical criteria that urge us to disregard narratives before we even consider their factual merits? Consider the specific case of conspiracy theories: A conspiracy theory explains world events by positing that a select group – the conspirators – operate society’s levers of power entirely clandestinely, in parallel and often in opposition to whatever power structures are considered legitimate. If the US Congress gets together and passes a law that the President signs – I know, it sounds outrageous, but bear with me – then a select group is operating society’s levers of power, but they are not doing so clandestinely or illegitimately. Not a conspiracy! Additionally, a conspiracy theory attributes improper motives to the conspirators. Secret societies with beneficent motives are a feature of wish-fulfillment superhero stories. But a real conspiracy is not only secret, powerful, and illegitimate, it is also malevolent. Billionaires who hatch a plan to reduce world population with the one-two-punch of a virus and a Trojan Horse vaccine against it – now that’s a conspiracy!

An earlier post argued that we should, in everyday interactions, attribute to others the motives we hope they attribute to us. That maxim alone could insulate the mind against conspiracy theories. But I don’t think its enough, because it doesn’t address their allure.

What is it that makes conspiracy theories so attractive?

I confess: I am so attracted. I find myself all too willing to believe that the world’s ways can best be explained by the desires of the few, whose power is greater in proportion to how deeply it’s hidden. One reason I initially learned to resist the attraction is that I feel it equally from mutually contradictory conspiracy theories. That’s how I know that it isn’t their arguments that make them persuasive.

Life’s trials and errors have suggested to me another maxim of receiving messages: a maxim I try – and often fail – to live by.

Ignore narratives that flatter your in-group.

For example, I can’t get around the fact that I am a white male. So I try to ignore narratives that flatter white males. Of which there are more than a few. At the same time, I could also legitimately identify with some historically disadvantaged groups, and there are also narratives that flatter them. I try to ignore them, too.

By “ignoring a narrative” I mean something like this: I regard it as something whose truth is presently unknown and possibly intrinsically unknowable, like the amount of rainfall at my current geo-coordinates a million years hence. It’s completely irrelevant to any present thoughts and choices. You could go with a stronger option, namely to deny any narratives that flatter your in-group. But denying a narrative already grants it more mental space than it’s worth. It starts you on a slippery slope of marshaling arguments pro and contra… Instead, just let it be.

Conspiracy theories are particularly flattering narratives. You assume that there is an extremely powerful, extremely intelligent, and extremely select group. Your awareness of them makes you at least as intelligent and gives you a kind of power over them. You piggyback off of the intelligence you ascribe to them. But what distinguishes you from the conspirators is that you are pure of heart. You are both in on the joke and above it. You can have your cake and eat it, too. That’s why it’s such an attractive narrative.

Schlaf Schafe, the series title, explicitly plays on that self-flattery. Those who haven’t seen through the conspiracy are just sleepy sheep. You, who have seen through the intrigue, run with the wolves.

I suppose I could spend time and energy working out a more precise formulation of the maxim. Surely there are ideas or narratives that happen to flatter some dimension of your identity but that shouldn’t be dismissed out of hand for that reason alone. You could encumber the maxim with all sorts of softening qualifications, replacing “ignore” with “demand an extraordinarily high burden of proof from” or some such thing. A more interesting avenue of refinement might be to make “flattery” more precise. For example, maybe the truly problematic thing about a conspiracy theory is that it commits you to the premise that you are in some kind of privileged position, intellectually or in terms of access to information. Any argument that begins that way is just unsporting, if nothing else.

But a simple guideline is probably more useful than a complicated principle: Ignore narratives that flatter your in-group.

 Conspiracy theories try to explain why the world is the way it is. A conspiracy theorist could say that rejecting her favored theory leaves an explanatory gap. I firmly believe that we can explain the world – warts and all – resorting only to the behavior of people with essentially similar motivations and multiple, overlapping, and at times conflicting loyalties. No conspiracy necessary.

I’d like to call attention to an interesting site, “Our World in Data,” a nice aggregation of research on many different topics. The particular article that caught my eye was entitled “What is economic growth?” – I’m a big fan of revisiting elementary questions. They’re usually not nearly as settled as you’d expect, and need to be asked over and over.

Nothing in this article sparks disagreement on my side, certainly not the main thrust of author Max Roser’s argument in this article and others he links to: That further economic growth is needed to raise people out of poverty: Attenuating inequality alone will not do the trick, even if it is a worthwhile endeavor in its own right. Roser also says that “Growth doesn’t just have a rate, it has a direction, and the direction we choose matters.”

I couldn’t agree more, and I think this question of the direction is too often ignored. To illustrate what options we might have for directing economic growth, I’m going to pick apart a particular statistic Roser cites, namely that “just two centuries ago roughly three-quarters of the world ‘could not afford a tiny space to live, food that would not induce malnutrition, and some minimum heating capacity.’” (Roser cites a study by Mihail Moatsos from 2021.)

I’ve commented elsewhere that the height of the Industrial Revolution (1820, two centuries ago and the beginning point for Moatsos’s study) may not be a fair baseline from which to evaluate our economic models. But let’s assume that the circumstances in 1820 were representative of the previous two thousand years or so. Let’s consider different scenarios in which a statement like “75% of humanity can’t afford food and shelter” could be true.

Scenario 1: 75% of humanity has insufficient access to food and shelter, the remaining 25% has just enough to count as sufficient. In this scenario, clearly economic growth – growing more food and building more shelter – is necessary. There is no alternative if we want to raise the 75% out of poverty.

Scenario 2: 75% of humanity has insufficient access to food and shelter, the remaining 25% consumes four times as much as they actually need. On the face of it, this sounds like a problem of inequality, to which redistribution is an alternative solution to economic growth. However, what if at any given point in time, it is not the same 75% that have insufficient access to food and shelter? So let’s split this into two scenarios:

Scenario 2a: 75% of humanity has insufficient access to food and shelter, and year after year the same remaining 25% enjoys four times as much as they need.

Scenario 2b: In a given year, natural variation in weather, etc., ensure that a random set of 75% of humanity have insufficient access to food and shelter, and the remaining 25% has four times as much as they need.

Do Scenarios 2a and 2b differ in such a way that we would propose different solutions to the poverty problem in either case, both for practical and moral reasons?

For example, in 2a it seems clear that 25% enjoy some kind of structural advantage, and if so, it’s not clear that just producing more food and shelter is going to solve the poverty issue by itself: We’d also want to have a look at the root causes of the structural advantage, and at least in principle, we might conclude that “more stuff” doesn’t solve anything, but different rules of distribution would. And depending on the root causes of the structural advantage, we might also feel that redistribution is the morally right thing to do.

In Scenario 2b we might solve the problem by growing more food and building more shelter. Maybe then we’d have enough so that even the “bad” outcome that occurs to 75% of the population leaves them an adequate amount to survive comfortably. But there might also be an alternative to blindly making more stuff. Political and economic activity could be focused not on “more stuff” but on reducing the variability in the outcomes. Depending on what we measure when we measure “economic growth” we may or may not recognize reducing variability in outcomes as economic growth, because we may not actually wind up growing more food and building more shelter: we just get better at channeling what is there already.

In a business, a lot of activity is not actually focused on “more stuff, more cheaply.” It’s focused on reducing variability: smoothing both supply and demand of products, services, and cash flow. The value of a company – its stock price or the price an investor is willing to pay to buy it – tends to go up not only when it grows its top line and its bottom line but when it creates the perception that it delivers reliable payouts to its investors. There are times in a business’s lifecycle when it makes sense to focus on its reliability more than on growing its profits: What ends up creating value depends on the constraints imposed by customers, suppliers, competitors, etc., and that context can change over time.

Similarly, the direction in which we grow the economy overall should depend on which of the above scenarios we believe we are in. Only in Scenario 1 is it unambiguously true that “more stuff” will solve the poverty problem, because unambiguously, there is not “enough stuff” even on average. But in both variants of Scenario 2, there is “enough stuff” on average, but not enough for particular individuals. However, the causes of an uneven distribution of goods differ between Scenarios 2a and 2b, and the approaches to addressing them must differ correspondingly, both in terms of “what works” and in terms of “what is right” (or at least politically possible).

Whether reduced variability can only be achieved politically – with winners and losers – or economically – with win-win solutions – is an open question. But that question can’t even be properly posed as long as all our rhetoric is focused on economic growth in the sense of “more stuff, better stuff.” All too often – and Roser’s essay is no exception – stories about economic growth are told through simple exponential growth curves: “See, we are making progress on producing more stuff, especially since the Industrial Revolution. Let’s continue down that path.” And all too often, criticisms of growth-oriented organizations of economic relations – specifically, capitalism – focus on intentional, structural inequality: “Cutthroats have commandeered economic growth to their benefit and nobody else’s.” Both perspectives may have some merit at the same time, and yet be largely beside the point: The bigger and more urgent challenge may be to find better ways to deal with random fluctuations in the local availability of basic resources. Neither “more stuff” nor expropriation and redistribution may be helpful approaches to this challenge.

Who takes more risk: capital or labor?

Usually, we assume that contributors of capital – capitalists – take more risk, which is why they get compensated with the capital return, whether in the forms of interest, profit, or rent. People who contribute time, effort, and skills to the production of useful resources – labor – get paid wages or salary. Because workers produce the resources, they have initial possession of them. Suppose Alice’s capital is an axe, which she makes available to Brian in return for some of the wood he chops. Brian chops the wood, and then has possession of both the wood and the means to produce it. Alice relies on Brian returning the axe and relinquishing the agreed share of the production. He may not be able to – the axe might have broken or he might not have found enough good wood to cut – or he may simply choose not to. That is why Alice faces more risk than Brian: She faces the wood-cutting risk he faces plus the risk that Brian may cut and run. That is the basis of her claim on a share of the produce over and above the return of the axe.

The arrangement in which someone – a “capitalist” – provides stored up resources to someone else – a “worker” – in return for compensation is the keystone in how we structure resource-sharing. What ultimately supports the structure is our collective belief that labor ought to compensate capital because of the risk capital takes. This structure allows us to collaborate and share resources far beyond reciprocal kinship boundaries.

Or so the story goes. But let’s take seriously the underlying moral claim of capitalism: that it is right and proper to be compensated for risk-taking. If risk-taking itself – besides contribution of time, effort, and skill – is something that ought to be compensated, then we should look closely at who takes what risks. Hence the axe example: Tree-felling and wood-cutting are relatively dangerous activities. Brian, by using the axe, takes physical risks that Alice completely avoids. By the very logic underlying capitalism, Brian ought to be compensated for the risk he takes, namely of getting maimed or killed in the process of axe-wielding, over and above the share he gets for deploying his time, effort, and skills.

That is why I don’t think you can make a moral argument for capitalism without simultaneously acknowledging the moral claim workers have on health and disability insurance: These are not benefits that owners can generously provide once society is productive enough. They are necessarily implied by the social contract in which risk-taking deserves compensation.

To me, this is an overlooked point: Social security benefits of various forms are often characterized as patches to a capitalist system, things that we can use to soften capitalism as long as we can afford the luxury. But that is the wrong frame through which to look at them: Instead, they are claims whose legitimacy rests on the same grounds as capital’s claims to a return.

The next Ruminathans will look at other dimensions of capital’s and labor’s risk-sharing arrangements.

At a given moment, Alice has more resources than she needs. She can put that surplus – her capital – at Brian’s disposal: Brian has a current use for it. As a society, we’ve agreed that it’s right and proper for Brian to compensate Alice for that service, over and above just returning her resources to her at a later date. The justification for this compensation – the capital return – is that Alice may need the resources in the future, but Brian may or may not be able to return them to her. Or maybe he won’t be willing. Either way, Alice is uncertain about whether she will get back the resources she’s allowed Brian to use: She faces risk, and as a society we have agreed that she should be compensated for taking that risk.

This agreement is how we currently organize our economic relations. Obviously, there are very many other dimensions and complexities to the picture. But this connection between risk and reward lies at the heart of how we create and share resources with each other.

We take the relationship of risk and reward and the capital return for granted to such a degree that we overlook some puzzles it poses. My next Ruminathans will pick apart a few of them. One future post will probably have to disentangle the main forms of the capital return: profit, interest, and rent. But for now, I want to look closely at one dimension of risk/reward through the lens of the capital return we call “profit.”

Pretty much everything we value needs time, effort, and skill to acquire. Even picking up a freshly fallen apple takes a second and the effort of bending over and lifting. Not to mention the easily taken for granted knowledge that an apple is good to eat, when it is best to eat, etc., knowledge which again would have taken time and effort to acquire. But in addition to time, effort, and skill, producing goods requires a pre-existing stock of resources: If nothing else, you need to already have not just food in the belly to have the energy to work, but a belly to begin with. You start life with a physical endowment from your parents, and continue with endowments of various types, including knowledge and tools. Between generations, we “compensate” those who pass on the endowment mainly by paying it forward, but also by taking care of the aged.

Endowments can be made available not only intergenerationally but between unrelated people. And thanks to an endowment, the person receiving it may be able to produce more resources than just what she requires to survive. If Alice has a nice harpoon, she can make it available to Brian who can use it to hunt more food than he needs: That surplus can be shared back with Alice. The premise of the institution of profit is that all of the surplus of food over and above what Brian needs to survive belongs to Alice: She has a moral claim to it, a claim that Alice and Brian’s society will uphold, through enforcement of contract law, using violence if necessary.

Clearly, a lot hinges on what society considers an acceptable level of Brian’s needs. Brian will point out that he has to not only feed himself but also his family. That while he is harpooning, he cannot find wood for shelter and heat, so he needs to trade some seals for other items, which means he also has to find people to trade with and convince them that his seal meat is fresher than other hunters’. That he also needs to spend time and resources to maintain the harpoon or replace it if it breaks. And finally, while it’s not specifically necessary, he could spend some time thinking about better harpoon design and hunting methods. During that time, he still needs to be fed, but based on his reflections and experiments he may actually be able to come up with a hunting process that generates an even bigger surplus for Alice in the future. Brian’s “needs” really include the full range of accounting expense items in an income statement: cost of goods, sales and administrative expenses, depreciation, and even R&D. Sure, Alice can have whatever is left after Brian’s needs have been met. But will there be anything? Will Brian succeed in hunting more than he needs? Will he define his needs “reasonably” in some sense, or will he interpret his needs in a way that leaves nothing left for Alice? Or will he simply stop working when his own needs are met?

This is the risk Alice faces, the risk for which she expects a reward, which we as a society believe she ought to get.

Now here comes the puzzle: By using the word “ought” I have slyly reinforced an assumption that I built in at the outset, namely that this is a moral issue: that Alice has a moral claim on the surplus Brian generates. But isn’t it also part of our current collective agreement on how to share resources that we all do so freely, and negotiate whatever contract terms we want? Alice could act as a non-profit, demand no capital return, and hence also have no moral claim to one. Under the terms of the free market it is not that the provider of capital ought to be compensated for the risk she takes, but that, de facto, rational actors will only enter into agreements in which risk is compensated. Over time, people with capital (capitalists!) who do not negotiate that compensation will cease to have capital, which prevents them from making endowments in the future and may make them dependent on others’ endowments. Only those who get compensated for the risk they’ve taken will, on balance, cover the risks they take. It isn’t that Alice deserves a reward, it’s that she will only agree to make her harpoon available if she gets one. Morality has nothing to do with it.

That is the conclusion I arrived at some years ago. But in the meantime, I’ve decided that this argument is pure sophistry. Alice and Brian, capital and labor, are indeed in constant negotiations, and not just between each other but within the wider web of interaction we call society. In a negotiation, both sides make arguments to each other about what is right and proper, what is fair. In doing so they explicitly or implicitly draw on community standards of fairness. The most strident articulation of the owner’s claim on profits is Milton Friedman’s famous “the social responsibility of a business is to increase its profits.” Friedman’s is a statement about what is right and proper: a moral injunction, plain and simple.

As we negotiate, we make appeals to our partners’ sense of fairness and to what the wider community regards as fair. And, of course, the results of our negotiations also re-calibrate the community’s sense of fairness. A string of contracts that work in labor’s favor establish that as the new standard, and vice versa.

“You don’t get what you’re worth, you get what you negotiate,” the ads in the in-flight magazines tell us. But we stake out ideas about what we deserve as part of our negotiation position. I see no way around this fact. So we may as well take it as a starting point. That means debating in good faith about whether taking risks deserves compensation, which risks deserve compensation, and who is actually taking the larger risks in the capital-labor relationship.

A writer I admire, Andrew Sullivan, recently released a missive (now behind a paywall) about the media response to a mass shooting in Atlanta. Mass shootings are not a Ruminathan topic. But what struck me is Sullivan’s insistent use of the term “media elites,” and not in a complimentary way.

What grabbed my attention wasn’t the spectacle of a media elite trash-talking media elites. Hypocrisy is a highly forgivable vice in my book in any case, but in Sullivan’s would be a grossly unfair charge. The former editor of the New Republic and titan of the blogosphere has taken principled positions that risked ostracism from his ideological milieu, and with similar courage has declared independence from the traditional media “establishment.” What strikes me instead is the increasingly negative connotation of the term “elite.” Sullivan’s undertone of a sneer as he writes “elites” is not as pronounced as Donald Trump’s – it’s hard to match that – but it’s there.

What are elites, and what is wrong with them?

These are questions I’ve been asking myself for some time and for many reasons, not the least of which is that I surely count as someone’s idea of an “elite.” Just having the leisure time to write a blog puts me in rarefied company. Gallivanting around the globe to teach managers at multinational corporations about leadership and finance clearly makes me one of the cosmopolitan beneficiaries of globalization. In Capital and Ideology, Thomas Piketty describes how center-right and center-left parties around the world have become dominated by commercial and educational elites, respectively. By most definitions, I fit squarely into their intersection.

All this to say that my interest in elites and their moral standing is not merely intellectual. Mind you, I’ve never felt elite, especially because my life has run on tangents to society’s true inner circles. I know that I am no closer to pulling levers of power than your average bus driver. Maybe I know that more acutely because my path takes me within distant sight of the doors of the antechambers of power on rare occasions.

Here’s something else I know. Life sometimes throws several crises at you at once. When that happens, you go into fire-fighting mode. And when you’re sprinting from one fire to the next, you have neither the time nor the attention to devote to fire prevention. It’s only when you have time to catch your breath and stop worrying about surviving that you can think longer term. Not only can you turn to fire prevention, you can think about whether “No Fires” is the right goal to aim for, whether having a controlled little fire burning all the time might not actually be helpful.

When we don’t or can’t carve out time to allow our minds to wander freely we cannot give our lives direction and meaning. And it’s not only about time, it’s about the kind of attention you can dedicate. The fire-fighting mindset is irreconcilable with the mindset you need for thinking about direction and meaning.

What’s true for individuals is true for organizations, of all sizes. We tend to think of the division of labor in terms of breaking down production processes into the smallest individual steps, as in Adam Smith’s nail factory. But another division of labor occurs between those who keep busy on the day-to-day smothering of fires, and those who think longer-term about the organization’s direction and meaning. The latter are elites.

Elites are usually able to stake out a disproportionate amount of society’s resources, as Piketty documents exhaustively in Capital and Ideology. On one common interpretation, elites – who by definition are those who set direction for organizations – enrich themselves by shaping the organization’s rules to their personal advantage. That’s undoubtedly true, at least in some cases. The question is: Why do the rest of us put up with it?

I would argue that we put up with it because – regardless of their motives – elites need reliable access to a sufficient level of resources to allow for leisure. As an organization, we free some of us up from survival pressure and fire-fighting so that they have the time and mindspace to think about direction and meaning. In the language of game theory: In the strategic interaction between elites and non-elites, we have settled into an equilibrium in which both sides cooperate through a division of labor, both sides reap material benefits compared to the base case where everyone goes their own way, but one side benefits more than the other.

Both game theory and the empirical research from behavioral economics (and history!) show that these arrangements are remarkably stable even if they are not equally advantageous to all participants. It’s part of this notion of an equilibrium that it doesn’t really matter by what path you reach it, e.g., marauding tribal chieftains setting themselves up as landholding aristocracy. Once reached, it’s hard to perturb the equilibrium because the immediate alternatives are disadvantageous to at least one party and possibly to all parties. Equilibria can be perturbed, and a future Ruminathan will explore under what kinds of circumstances that is likely to happen. But the new equilibrium may be no more egalitarian than the one before, or if it is, it might also be to everyone’s material disadvantage.

So we can and should have debates about who plays the role of elite, and by what processes we promote people into those positions. But as long as we accept the underlying premise of the division of labor, we will have elites and they will enjoy material privileges, not because they “deserve” or “earn” them in any moral sense, but because material privilege is a necessary condition for elites to be able to play their assigned role.

Having acknowledged that I might be considered a member of an elite: Is this just a self-serving defense of my own privilege? Probably so. My self-doubt is too well-developed to categorically deny it. But as I have argued elsewhere, we don’t get very far by dismissing others’ arguments based on their motives alone.

And here is what I will say: I think we have for too long, with too little reflection, and too enthusiastically placed all our chips on the division of labor. No material gain may be worth pushing some people into permanent fire-fighting mode while outsourcing all direction-setting and the search for meaning to others. We may want to take a step back and carefully consider the true costs of the division of labor.

Of course, right now, only elites have the leisure to do that reflection.

“The reasons schools are being reopened are purely political.”

“I think it’s very cynical, the way the government is making decisions about Covid; it’s all about economics.”

I’m paraphrasing friends’ statements, and this is just a small sample of similar opinions. These two happen to be about the Covid crisis, but I’ve heard variants in a hundred different contexts, within all cultures I am intimately exposed to (US, German, French).

“Politics” and “economics” are dirty words.

I think I understand what people mean when they use politics and economics as dirty words. But doing so is wrong-headed and counter-productive. I have needs and desires which I cannot meet with resources at my immediate disposal. Meanwhile, I have a superabundance of other resources that happen to meet your unfulfilled needs, and you just happen to have more than you need of something that will scratch my itch. There’s a win-win solution here. The systematic ways we find win-win solutions are called economics. If economics is dirty, roll me in the mud.

Sometimes, no win-win solution is possible. Yet a decision has to be made, and any option – including inaction – will designate some groups as winners and some as losers. The systematic ways we designate winners and losers are called politics.

It is impossible to govern without picking winners and losers, not because government is dirty and not because those who govern are intrinsically corrupt: Government is simply the mechanism we set in motion to resolve situations where no win-win solution is available. In political philosophy this is called the “dirty hands” problem, and its name unhelpfully reinforces the perception that politics is unclean.

Nothing in my lifetime has pushed the dirty hands problem right under my nose like Covid has. We’re whiplashing around as we try to spread costs and benefits as fairly as possible, but there are winners and losers. Many people in my bubble characterize the pandemic as a scientific problem, and believe policy should be a simple matter of following the science. If we had but one goal, and that goal was to contain the epidemic, then that would be the best approach. But containing the epidemic is not our sole goal, not individually or collectively. The epidemic poses, by its nature, a political problem: who will benefit and who will bear the burden?

There is a wonderful book about how society has confronted the dirty hands problem historically: Paradoxes of Political Ethics: From Dirty Hands to the Invisible Hand by John M. Parrish. The title embeds the thesis that, over the course of Western history, more and more win-lose situations have been reframed as win-win situations that can be resolved economically. But something that caught my attention in the book is the idea that democracy is attractive because it is a kind of shell game of moral responsibility. The dirty work has to be done, the difficult choices made. Voters absolve themselves of the responsibility for it by blaming the politicians. Politicians absolve themselves by invoking the will of the people. It’s a stable arrangement that allows everyone to feel like they’ve kept their hands clean.

Maybe it’s fine to participate in the shell game. There are worse vices than hypocrisy. But I can’t help but worry that passing the blame and washing our hands undermines the mutual trust and respect on which our web of reciprocal relationships rests. And I can’t help but believe we’d find more win-win solutions if we all rolled up our sleeves and got our hands dirty instead of looking down at those who do.

At the bottom of the ocean, two tectonic plates strive against each other, titanic forces equally balanced. Above, the calm sea hides the tensions in the Earth’s heart. A rock fractures, unbalancing the system, and the forces are unleashed. But the sea disguises all for long after, until suddenly, an immense wave wrecks devastation thousands of miles away. The wave merely transports the tectonic forces to the distant shore, the same forces that, just recently, had been the guarantors of calm. 

My wife and I recently remarked on how hopelessly naïve we are after watching the very bleak series Babylon Berlin. Like most interesting series in the last decade or so, Babylon Berlin is a study in moral ambiguity: No protagonist, no matter how sympathetic, without a dark secret; no antagonist, no matter how loathsome, without a redeeming act of kindness.

Much like in real life.  

We feel naïve, though, because we have a hard time fathoming the darker motives that drive some of the characters. They seem like space aliens to us. They thirst for power for its own sake. They savor cruelty. It’s not that we believe these aren’t realistic motives for some people, it’s more that in Babylon Berlin – set in the Weimar Republic as it descends into fascist madness – those darker motives are portrayed as having world-historic import. It’s fiction, of course, but Babylon Berlin touches fact in many ways, and it suggests a worldview: The world is willed into disaster by humanity’s worst impulses.  

The same worldview runs as a common thread through many of popular series of the last decade or so: Breaking Bad, Game of Thrones, Westworld, House of Cards, Veep to name a few. It’s a worldview in which peace is not guaranteed by people’s desire for it, but by their worst impulses locked in a stalemate, until some inciting event throws things out of balance and unleashes a tsunami of violence.

That’s one way to look at the world and our own hearts. There’s another way, and it, too, is embodied in a popular series. The Wire is another study in ambiguity, and it also portrays a society, a polis (Baltimore) fracturing along a web of interlocking fault lines. But in The Wire – with one exception –the characters don’t seem like space aliens to me. They are driven by motives I can relate to; they want the same things I do, and that does not include power for its own sake and cruelty as enjoyment of that power. In The Wire, characters inhabit different circles of mutual obligation: to self, to family, to neighborhood, to teams, to organizations, to political parties, to the polis itself. Conflict emerges between those circles because not all obligations can be met. And because all characters inhabit multiple circles, the conflict is just as violent within individuals as between them. It’s heartbreaking, because no character’s heart can be in the right place; it has to be in several places at once.

Much like in real life.

There is a character in The Wire whose heart is unfathomable to me, the exception that proves the rule. The emerging drug lord Marlo is nothing but a raw will to power. Having achieved recognition, wealth, security, and even a kind of legitimacy at the end, he cannot help but put it all at risk again and exercise sheer physical cruelty for its own sake, descending literally into the gutter to knife a stranger.

I am not so naïve as to believe that no such characters exist in real life. The difference between the Babylon Berlin and The Wire worldviews is that the former places a bit of Marlo in all our hearts and makes it the motive force of all that happens, whereas the latter sees Marlo and his rise as an outcome of societal conflict, not its cause. Are society’s tectonic forces blind ambition and cruelty pushing up against each other? Or loyalties and loves pulling us apart?

I subscribe to The Wire version of things. We don’t need a heart of darkness in all of us to explain the world’s awfulness. Our obligations – to self, to family, to tribe, to polis, to the nation-state, to the globe – are in enough tension with each other to lead to a cataclysm when balance is lost. Alien hearts like Marlo’s, Hitler’s, Stalin’s exist, and they may be able to ride the shockwave’s crest, crashing destructively on our shores. Our tragedy is that our best motives, fragmented across many loyalties, suffice to unleash the disaster.

Now I’m not sure which worldview is naïve and which is bleak.  

What shape should you give your life: Single-minded, uncompromising dedication to a calling or dabbling in several areas at a slightly-above-average level?

My last Ruminathan began discussing the ethics of the division of labor, raising the same question, but from the point of view what we owe each other. Provisionally, I gave the pat answer: Specializing allows us to be more productive, giving us all a better chance of meeting our needs and desires as long as everyone plays by certain rules. The pat answer doesn’t do it for me, but that is another subject for another Ruminathan. In the meantime, I am interested in the same question from the perspective of choosing the good life.

At my age, I have pretty much placed my bets on dabbling. But it’s still a burning question as I raise my children. They will, of course, choose however they choose. But I can help them recognize that it is a choice.

There are different ways to specialize. The workers in Adam Smith’s nail factory divided up the nail-production steps, and by specializing, they became more productive. Yet it would be wrong to conclude that specialization always involves the separation into simpler and simpler tasks that require less and less skill. That kind of specialization can lead to productivity gains. But it also leads to the worst kind of drudgery. If that were the only variety of specialization it would clearly be a bad choice, offering neither intrinsic rewards, nor good pay, nor job security. We wouldn’t choose that specialization. We’d have to be forced into it by circumstance, as many have been and are forced.

That is one of the most powerful ethical arguments against a Social Grand Bargain built on a relentless division of labor. Whether that argument has been defanged by outsourcing drudgery to machines and programs is an important question that I won’t pursue for now.

But what about the “interesting” specializations, the ones that take years to develop, that involve a winnowing, both of contenders, and of the individual contender’s habits? Where – even when mastery is achieved – you have to spend an enormous amount of time just to maintain your level, never mind hone your skills further. Where you truly have to sacrifice at the altar of your dream. Professional musicians and athletes are examples, of course, but the same goes for most creative work, and wherever commanding a vast and evolving body of knowledge is essential. Is the single-minded pursuit of these specializations a good choice in the game of life?

I’m not concerned with recognition per se. And in any case, recognition and remuneration will not occur until after you’ve made your choice. Probably long after. I’m concerned with what questions will haunt life’s second half, after the die has been cast. And I don’t believe the only important questions are “If I had taken the other path, would I have received more recognition? Would I be wealthier?”

Nor am I concerned with “happiness,” whatever that may be. Maybe the best way to frame the question is: “Assuming that we have only one life to live, did I make the most of mine?” 

You might think natural talent plays a role in the decision. But it’s not like we can measure raw talent reliably before we put in the hours. In winner-take-all fields, you probably need both exceptional talent and practice, yet there are many fields where you can make a living on an average talent endowment, provided you put your nose to the grindstone. And then, if you don’t make it to the very top of your field, you may always have to ask yourself if it’s because you’re missing that secret sauce or because you could have devoted another half-hour a day to your calling: You may never know for certain that you are truly talented, to which “imposter syndrome” testifies. So the question of whether or not you have talent is separate from what shape you choose to give your life.

And of course, there are people who achieve excellence in more than one area. My own favorite is an astrophysicist and historian/practitioner of stereophotography who is also a musician of some repute. Often, these Renaissance people attribute their success in each to cross-pollination between their interests. But that probably just means the lucky bastards were endowed with many talents and can dabble at a superior level. The question remains: Would they lead a more fulfilled life if they pursued a single calling?

As an inveterate dabbler, I can always rationalize some ways to recommend the dabbling way of life: Single-mindedness is, in any event, always a matter of degree. Some time every day needs to be devoted to needs up and down Maslow’s hierarchy. But for the single-minded, any individual indulgence – the carefully prepared meal instead of the scarfed-down takeout, the late night with friends followed by the unproductive, hungover morning, the palette-cleansing fantasy novel read instead of slogging through Kant in the original – has to be not just a guilty, but a remorseful pleasure. At least from my outside dabbler’s perspective, it seems that the single-minded pursuit of a calling can’t help but overlay everyday joys with anxiety. 

Or maybe it’s the very theft of those moments that renders them truly exquisite in a way that a dabbler can never appreciate?

What’s for sure is that our Social Grand Bargain exerts pressure to specialize, so it’s at least possible that the voice inside you telling you to pursue a calling is nothing other than that social pressure, internalized. Then the persuasive force of that call is grounded in the argument that we owe it to each other to specialize: Single-minded specialists are the ones who cooperate fully in the social game, devoting all their energies to the domain in which they are the most productive. Dabblers are exploiters who fritter away their energy in less productive ways, while enjoying the surpluses produced by the specialists. If we buy that argument, and if we believe that participating in a society – in the sense of living according to its rules and expectations – is at least a necessary condition for the good life, then maybe specialization is the way to go. But those are very big ifs.

What if we’d all live fuller lives if we made music ourselves, even if we sing out of key; if we spent more time cooking, even if we boil noodles into a soggy mess; if we told each other stories, even if they aren’t as epic and plot-twisty as Breaking Bad; and if we put our kids in childcare for half a day while we work half a day at any old job, instead of paying someone to take care of them all day while we pursue a high-powered career?

A colleague of mine just announced he is leaving his current job to go to SpaceX, having dreamed all his life of working in space exploration. Pursuing his dreams involves uprooting his family and moving halfway across a continent. His is a choice I’d make very reluctantly, but it raises the question: Do I have a “dream” at whose altar I’d make that sacrifice? Does the good life require that intensity of worship?

Having written this, I admit I’m no closer to a conclusive answer. I may return to the question in a future Ruminathan, but I feel like I need to go back and read Kierkegaard first. And what dabbler has time for that?

My main preoccupation for several years has been the question “why is it possible to earn money for no other reason other than already having more than you need in the first place?” I’m not satisfied with the standard stories, and that is what motivated the Ruminathans. But lately, I have been thinking about another element of the way we’ve organized our economic relations: the division of labor.

Adam Smith’s Wealth of Nations opens with his famous description of a nail factory. Its workers are collectively more productive when they split up the steps than they would be if each worker took a nail through the whole process, from beginning to end. By specializing in just one step, a worker can become enormously productive at it, and if the collective work of specialists is well-organized, a factory of ten specialists produces many more nails than ten generalists working individually.

As at the nail factor, so in society. Collectively, so the story goes, we are much more productive and much better at meeting our individual needs if we specialize rather than trying to live autarkically. Of course, at the nail factory, it is somebody’s specialized skill to design and manage the overall production process. While that may work at the scale of nail mass production, no single person can coordinate the specialized contributions of teeming billions. Luckily, just a few basic rules can generate self-organization in complex systems, as long those basic rules are allowed to operate uninhibited. Although some individuals may not be able to meet their needs perfectly under those rules, the emergent self-organizing system meets individual needs better than the two alternatives: everyone living autarkically, or the central organization of the workflow of billions of specialists. The all-important rule is simply that each person should maximize their “utility” where utility is the aggregation of an individual’s preferences. And, according to some, this rule just happens to coincide with our natural inclinations.

In fact, even if those aren’t our inclinations and we set others’ utility above our own, according to this view, we should still follow the basic rule, even though it appears selfish. Two reasons: a) applying the rule is what allows self-organization to work, and b) we’re usually pretty clueless about others’ utility anyway, and we should let people just work things out for themselves. The latter will ring true for any couple who has ever tried to agree on what movie to watch when both partners try to put the other’s wishes above their own.

That’s the summary of the argument for free markets. Even shorter: We’re more productive when we specialize, but then we need to coordinate, and the best way to coordinate is to follow a few simple rules that allow self-organization to emerge in a complex system.

Put in terms of first great question of ethics (“What do we owe each other?”): We owe each other to specialize ever deeper, getting more and more productive so that we can meet everyone’s needs better, collectively. But by specializing, we throw ourselves at each other’s mercy: Giving up the ability to meet our needs on our own is a big risk. To manage that risk we also owe it to each other to put systems in place to ensure that everyone holds up their part of the bargain and that, amidst all this specializing, we don’t leave big gaps in the supply chain.

That is society’s Grand Bargain. We don’t individually find food, water, and shelter. We break down delivery of goods into ever longer and more ramified supply chains, let prices fluctuate freely in order to signal what stuff we need more of and what we need less of, and hope for the best.

We don’t just outsource our provisioning of water, food, and shelter. To focus on that one little sliver of the Great Supply Chain we actually get good at, we need to clear our schedule: We send our children to childcare and education specialists, pay cleaning specialists (trash collectors at least, if not housekeepers), and let restaurants and consumer goods companies take on food preparation. Rather than make music and tell stories ourselves, we pay specialists to do so for us. After all, by specializing they get much better at making music and movies than we ever could.

So much for the division of labor and the first great question of ethics. I’m not satisfied with this story, but that’s a larger topic worthy of many a Ruminathan. In the meantime, what has caught my conscious attention in the last few months is the second great question of ethics: “What is the good life?” Does focusing on one thing and doing it extremely well constitute a life well-lived? I know how I have chosen to live my life, and in the “About the Author” sidebar you can see that I have resisted specialization. But did I choose well?

A future Ruminathan will explore that question. One thing is for sure: I won’t settle quickly for a flabby “do whatever works for you”-type answer. That is the last refuge after trying like hell to find the good, the beautiful, and the true.