The Virtue Of Violence: “We do not forego violence in exchange for democracy, we forgo violence in exchange for creating and accessing the market. Democracy is simply a means of hiring and firing the administrators of our markets. We do not exist to serve democracy. Democracy exists to serve the market. And should it cease to do so, it ceases the only reason for its legitimacy or use, and is simply a means of whereby the masses destroy the accumulated prosperity of the market in the greatest act of theft and ruin that a humans can perpetuate. If we are no longer cooperating in order to maintain our market. Then we no longer need to cooperate to maintain our government. And as such, we no longer need to restrain our violence, so that we may recreate a market and a means of administrating it. The principles of non violence and non aggression are a means of stealing from us whenever the market is circumvented by those we hire to administrate it. It is an act of deception and fraud. It is an infinite discount on our contribution of forgone opportunity for the purpose of creating the market. That is the true meaning of the word ‘freedom’: to spend the currency of our violence in creation of the market, our respect for property such that we may cooperate in a division of labor, our time and efforts in the creation of products and services to participate in the market, and our rewards for having done all of the above. Violence is the source of the market, and the market the source of our prosperity, cooperation, and happiness. Violence and it’s use in creating and maintaining the market, is man’s greatest achievement. Violence is a virtue because it is the amount of violence possessed by men, and their creativity in and capacity for using it, and the use of it to create the market, that is the prerequisite for prosperity, and division of labor.” And there is no other argument for the source of the market, our actions in maintaining it, other than we are slaves or children instead of free men, capable of any creative or destructive act we choose. And I will not surrender my violence, and pay the cost of forgone opportunity to create a market from which I, my family, my friends, my tribe, my culture, may prosper, so that someone may enslave me.” – Curt Doolittle Curt Doolittle’s writes on libertarian economics and conservative politics at Capitalism v3.0, and hosts the Libertarian And Conservative Roundtable news feed – a set of syndicated articles opinions and news in the english language from across the web. (From Our Facebook Page)
Theme: Institution
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Conservatives Can’t Remake Society Either.
Leftists wish to remake society. They want to return us to the “homogenous tribal redistributive society” (HTRS) on a large scale. They will fail. They have failed. They cannot make a homogenous redistributive and tribal society from a multicultural empire of vastly unequal groups of people who who act as competing groups of people. ( See Putnam’s article on the impact of diversity ) The only result of any government over this diverse set of people will be a totalitarian one. While in our fantasies, we believe that we could have immigrated only a certain class of people, or a certain race of people, or both, but the continent is too large, and the chance to profit by importing cheaper labor in each generation diluted the chance to become a large, powerful and single-class-single-race society. The import of the vast numbers of Europeans who then in turn used the new land and ready capital to produce cheaper goods to ship back to europe at a discount was not an insignificant cause of the collapse of european civilization and the resulting european civil war we call the world wars. Status is epistemologically necessary social construct — we couldn’t live without it — and Status also controls access to mates, networks, and opportunity. Since a large and diverse population would doom most people in the population to a status discount in exchange for economic solidarity, they fracture into factions where status within the factional group gives them access to mates within their group, opportunities within their group, and influence in their group. In other words, this factionalization creates an increase in the opportunities for any individual to obtain status. (Islam and Buddhism solve this problem by making status spiritual rather than material. This is the ;primary attractiveness to these religions. They create mental rather than material status. Jews work the inverse methodology: the achieve status by group persistence. Whites are torn, and that is their problem. ) Each little faction in the world seems to desire that they make their whole society homogenous, equal and tribal. OUr tribal instincts, and instincts they are, compete with our status instincts to form an equilibrium between the comfort necessary to maintain a group, and the innovation needed to strengthen the group. We call these the masculine and feminine, but that is to apply gender bias to a problem where gender is meaningless. The only societies who achieve the comfort of tribal equality do so by embracing that feminine tribal homogenous egalitarian principle at large, and oppressing attempts at disruptive status attainment, is the poor, ignorant, and despotic monotheistic societies. And in doing so they embrace the virtueless cycle of degenerative decline. So no, liberals cannot remake society. And if they succeeded we would simply decline in prosperity. They would not make the utopia that they dreamed of. Or rather they might make the feeling of coming utopia, but actually cause decline. Whereas conservatism forces us to face material reality and in doing so we create a utopia we had not planned to. But conservatives cannot remake society either. We never could. Conservatives live by the fantasy that they can create a society where they can legitimately rule, without violence, by merit alone, and that merit the act of denying the accumulation of power, by the force of rules of consent, rather than the promise of violence if those rules are broken. In other words, conservatives who are not willing to use violence to maintain the rules are attempting to get others to pay the costs of maintaining those rules. In more economic terms, conservatives are as unwilling to pay the costs of preventing the accumulation of political power, as liberals are unwilling to pay the costs of enforcing the extraordinary discipline needed to control breeding rates, to work and save, and to build a meritocratic society. So, in this light, conservatives are either foolishly believing the documents of their religion of the American Founding Documents If someone breaks the rules you must resort to violence. The purpose of the rules is to avert violence. The threat of breaking the rules is that we will return to our use of violence. On a regular basis we allow liberals break the rules. Conservatives do not use violence against the state because it would be violence against their church. Yet liberals use violence and protest and insurgency and capital disruption and undermine the constitution, undermine the courts, by-pass the legislature. And conservatives sit by, wondering why their god does not enforce the scripture of the founding documents. Conservatives believe that we can aspire to make everyone noble – a member of the fraternal order of soldiers of equal suffrage. They believe that we can live according to the founding principles of the american republic, rather than those documents only survived seventy years, until the civil war. Afterward it became a useful myth by which the attainment of power could be justified by popular consent. The American founding civilization died with the civil war. Since 1914 we have taken over the role of the british empire. Our ‘god’ died with that war. For a brief period in human history, we created the illusion that a majority of people could join the civic republican tradition. Any man who could fight and could own a bit of land, could call himself noble. Because of our vast division of knowledge and labor, which has freed us from physical labor, and which rewards merit, status, and prosperity to the result of genetic gifts, our citizenry is no longer equal enough to form a large class of lesser nobility and soldiery, that is the social construct necessary for political unity, and cultural and territorial expansion, and the maintenance of an empire. There is no equality of man. There never was. There never shall be. We are unequal. We are unequal in physical ability and intellectual ability. (( Human capital is an asset that is worth investing in: when educated in large numbers, african americans only improved in IQ slightly, they did improve. )) We cannot have a government of equals unless that society is extraordinarily small and homogenous. The republican form of government was always a minority form of government. It was simply a meritocratic minority form of government, that desired a constant expansion of and rotation of the elites in order to keep the homogenous society competitive and the elites prosperous. To attempt to make a homogenous tribal redistributive society out of an empire of heterogeneous is simply an impossible act. THe question then, is do we fragment the empire so that each fragment may have a homogenous tribal redistributive society, or do we rule the empire in self-defense, to protect ourselves from it? Any group that wishes to maintain power must in the end do so by its willingness to use violence. Any group of meritocratic individuals must maintain power or become the subject of extortion by less meritocratic groups : usually the priestly class or their modern version the public intellectual class. THis is another instance of the ancient battle between those who coerce by words and those who coerce by force, and those who coerce by trade. Conservatives are, by and large, the remnants of lesser nobility. They practice military epistemology. (( Military epistemology is the most accurate epistemology because the outcome of taking risks is very high. Nassim Taleb discusses this topic in The Black Swan. )) The questions we must answer are : 1) Whether we will use violence to maintain the meritocratic society, or become enslaved by the Bonapartist (( Bonapartism: democratically elected totalitarians )) ambitions of the politically active minority. (Contemporary Russia is a Bonapartist state.) 2) Whether we will break the nation into regions which may choose different approaches to government and allow people to vote with their feet, or whether we will stay an empire and attempt to force people into the Civic Republican Model. (( Immigrant urban areas will choose Bonapartism, the south, and middle of the country will choose meritocracy, and the west coast democratic egalitarianism – at least as long as the center of world trade remains the pacific rim. ))
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Conservatism Is Not A Longing For The Past – It’s A Capitalization Strategy.
Being a conservative simply means taking a gradual approach to social change and particularly with respect to the financial, family and military traditions that affect status and political power, which they are skeptical of. Conservatism means being skeptical that our visions of the future will come true, and looking at the world as what people ACTUALLY DO not what we WISH they would do. In that sense, conservatism is historically scientific even if linguistically archaic. Conversely, while liberalism is linguistically modern, it is utopian, idealistic, contra-observation, contra-history, and therefore anything but scientific. The differences between these two philosophies are vast and numerous, but the one that is most important, is the difference between the reliance abstractions from experience in conservatism, and the reliance on abstracting experiences in liberalism. This may seem a complex idea, but liberals try to extrapolate the daily experience into the extended order of human cooperation. THis is called ‘induction’. Conservatives synthesize the actual experience of aggregate human activity from history. This is called ‘deduction’. Induction is a process that we are not sure, despite the vast effort of philosophers, exists. In other words liberalism if faulty on scientific grounds. It is a religion. This language problem has always been an issue for conservatives. Liberal dictums may sound scientifically sound if one induces from experience. Conservative (dictums) are sensible when one deduces from abstractions of history. And everyone must use these shortcuts, because too few of us possess the knowledge to make rational judgements and therefore must rely upon basic principles when making decisions. In fact, rational thought is applied to the vast minority of choices. Most decisions are made by habit. The rest according to shortcuts. For the vast majority of people from either conservative or liberal, neither induction or deduction is a rational process of choice, but instead, a process of identifying analogistic sentiments: it’s the act of pattern recognition rather than reason. Pareto called this process of pattern recognition “residues and derivations”, others called them “Metaphysical Judgements” or “Sentiments”. Contemporary thinkers and public intellectuals call them “beliefs” or “biases”, or “science or religion”. And our language incorporates these different sentiments. Our arguments do as well. Our narratives, myths, popular fiction, entertainment, status aspirations do. But so do your political rhetoric, which, because reason would be a technique unavailable to the masses, rely entirely on a complex web of constantly warring sentiments wherein the citizenry seeks confirmation bias, rather than a simple argument consisting of reason, where the citizenry seeks both consensus and falsification of their biases. In other words, where people are skeptical – conservative and rational. Utopianism is a technology that people use during periods of prosperity. Because we have been artificially prosperous due to the discovery and exploitation of a continent, we as a nation are notorious for predicting an optimistic future that cannot or has not occurred. The public dialog over the causes of our prosperity is often inaccurate and self-congratualtory rather than factual. We have transformed our culture of evangelical christianity into one of evangelical democratic secular humanism. Conservatives are skeptics. They may speak in antiquated language, because antiquity is their source of their language. They may fail to articulate their position effectively in contemporary terms because of that language, but regardless of the source of their language, the content of their language is strategic, intelligible and rational. And it is not just a language, but a methodology that represents their strategy for social order. They ACT conservatively, think conservatively, and treat the world conservatively. This conservative strategy and conservative activities are why conservatives are, in general, more prosperous – and frankly, happy. And the sacrifices that they make in order to be prosperous are material to them. They remember them. And therefore they resent those sacrifices being ’spent’ by others who do not make the same sacrifices. Monetarists and capitalists are not conservatives. They may hide under conservatism. But they are not conservatives. The conservative class is a military, middle and craftsman class and it always has been and always will be. It is the ‘residue’ of the european fraternal order of soldiers at the bottom, and at the top, it’s a ‘residue’ of the middle class movement that revised and adopted civic republicanism during the enlightenment as a way of transferring power from the kings and church to the middle class. it is an alliance of the military and middle class. Liberalism (socialism, communism) is a ‘residue’ of a union of the priestly cast and the peasantry. Academia is simply an outgrowth of the church. The peasantry has always allied with the church, and the church has always had power because of it’s support by the peasantry. And that said, we do not have a separation of church and state. Our state religion is now democratic secular humanism. We are now a state-run-religion using the myth of division of church and state to oppress (or reform) religions so that we can have a state sponsored church. That’s it. That’s the articulated conservative position. The republican party collects conservative coalitions. The republican party is not a conservative party. conservatives join the republicans because they have no choice. They see the party as corrupt. People are complex and only join parties because of limited choice mandated by our ‘winner takes all’ form of government, which fosters class warfare. In fact, all political decisions exist on a spectrum or bell curve. There are a myriad of political decisions to be made. There are a myriad of people with different abilities to understand each political opinion. Each person is interested in a myriad of decisions. Parties are collections of people with opinions. Very skilled people tend to be highly unsatisfied with party choices. Very unskilled people tend to simply support their party of nearest interest. Parties therefore pick platforms that make enough people happy that they can get into power. Arguing that conservatives want to keep things asa they are, is a silly argument. The objection is simply illogical. The question instead, is whether liberals propose a solution that conservatives can live with, and wether conservatives can propose a solution that liberals can live with. The difference between social classes are differences in Time Preferences (between “consume” or “capitalize”, or gratification now versus gratification later). Longer (lower) time preferences are only possible if you have the ability to comprehend long term time preferences. This is another reason why social classes are organized by intelligence, and why a market economy tends to organize us into economic classes according to our application of intelligence to the satisfaction of OTHER PEOPLES WANTS, instead of our own. Time preference affects not only a dimension covering an individual’s perception of gratification. It’s a second dimension that describes whether his gratification now or later is served by providing solutions to himself or to others. This is the moral lesson of Adam Smith – that capitalism creates a virtuous cycle. If we had listened to the liberals in the last century we would have ended up like either Russia or China. If we had listened to conservatives we would not have had our progressive social changes, but we would not have corrupted our financial system using Kenesnian inflation. It’s the competition of ideas that gives us the choice as a body politic. It is the combination of LIBERAL OBJECTIVES and CONSERVATIVE METHODS that provides the means of achieving shared goals. Lets say that again. Liberal objectives are moral desires. Conservatives methods are moral means. It requires both these tools to achieve moral ends. The problem is, conservative methods take time because they require the learning and adaptation of people to calculative processes. These processes have nothing to do with religion. Christianity is largely a religion of the poor. Protestantism is perhaps the most important religion for generating wealth in the west as it is a class religion. Secular humanism is a feminine religion just as Aryanism (expansionist civic republican tradition of the initiatic fraternal order of city-defending soldiers) is a masculine religion. We do not need all to believe one thing, share one goal, work according to the same rules. If we did, we’d break the principle of the division of knowledge, labor, time, and intelligence. WHat people really want when they seek universal agreement is to concentrate labor, knowledge, time and intelligence on their goals at the expense of other people’s goals. Since people are unequal in their ability, in their class goals, in their cultural goals, in their age and experience, in their knowledge and in their intelligence, then we must divide up our actions into bits and pieces which we cooperate with each other to achieve. Democracy as we have implemented it is a winner-take-all political order. It foments class warfare. It does not foment class cooperation. We need a government that is a return to the division of labor and division of classes and time preferences. Democracy is a failure as we have implemented it. Because we confuse the value of the transformation of power inherent in democracy with the universal aspiration of classes, cultures, ages, generations, and abilities.
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IEA Thinks Taxis Are Not A Public Good
Over on the IEA Blog, Eric Masaba asks the question: Why do black cabs cost more than Concorde? I couldn’t point out ALL the holes in this article, because the IEA blog limits the number of characters per comment. I find the argument for the virtue of brevity a ‘cute’ one because affirmations are the most brief of comments, while refutations are the longest. The state subsidizes the ‘Black Cabs’ of London.
Hackney cab drivers inexplicably enjoy a rule stating that no one else can describe a taxi service as a “taxi” in their marketing, and the important restriction that no one else can pick up passengers on the street. These regulations have deep historical foundations, dating back to the days of Dick Turpin. In today’s world, they are anachronistic, anti-competitive and pointless.
London cab drivers are a pleasure to deal with. They are an intrinsic part of the tourist trade. The Danes pay an entire social class to stay home so that the average clerk in a train station is educated, literate, well mannered, and a pleasure to deal with.
When there are price comparison sites for insurance, airlines, hotels, holidays and office supplies, where we can buy the same product from a myriad of suppliers at different prices, how is it that there are very strict rules requiring that Hackney drivers receive a minimum wage for every mile driven yet private hire drivers do not?
Because the market is an unlimited physical space and the streets of London are a limited physical space (and the tube is a monopolized space. And therefore Cabs require a very simple set of regulations in order to maintain quality.
Why is it good for certain stripes of taxi driver to be able to oblige people in London to pay higher rates than the market would support if such a law was not in place?
Why is it a good for the state to regulate any kind of competition?
Why do the same drivers, who expect to be able to choose what clothes they wear (and how much they pay for them) and which airlines and car insurance firms they use, want to deny travellers in London the basic freedom to choose another vehicle service they can hail at the airport or on the street?
They don’t. You can hire a car from the airport. You just can’t pick someone up on the street.
If people want to pay for the superior knowledge that the Hackney drivers clearly possess, they will do so. If they do not care, they will find cheaper alternatives until the market has informed the black-cab community what customers really think and what price they are willing to pay.
They are not paying for the knowledge. The state is using a knowledge criteria to create a hurdle for market entry. Just like they do for just about every kind of specialist.
Many people are disgusted with the special treatment bankers received, but through the price controls and regulations on taxis in London, transport markets are being distorted to favour one type of vehicle provider.
Bankers recieved special treatment because the state printed money without regulating it and forced banks either to compete for profits or to go out of business. This process of moral hazard created large banks that are pseudo governmental agencies, that were so responsible for subsidizing the national payroll and cash disribution and management system that if they were not rescued then the crash would have been worse. On the other hand, the state CREATED the moral hazard. But it did not have to. The problem has been that creating the ‘rules’ of the fair game in banking (defining the properties of property and it’s rules of transfer) has become extraordinarily complex because the object of definition has become exceedingly plastic. Derivatives and new financial instruments were a new form of property that many of us decried at the time, but that was unregulated because both the state and the purveyors of these new devices foolishly bought the argument that it was possible to insure that kind of risk, and secondly, because So, I have to disagree with the IEA’s position. Travel to NYC, Chicago, LA and ask yourself if the London policy is better or worse for everyone involved. And if we subsidize transportation like subways why cant we subsidize Cabs. If price is a concern, then If you want another choice, call a less expensive cab company on your cell phone. Prices aren’t everything. In fact, low prices and full competition in a market often accomplishes the lowest cost service at the lowest quality that is tolerable by consumers, and bars quality from availability within a geography. (Home Depot and Walmart in the US, and superstores versus butchers, bakers and the like in Europe). I am happy that superstores exist to provide additional choice, but only if there is a replacement ‘tax’ for using them by distancing them. From this simple analogy of taxis and tubes versus superstores and specialty stores, we can illustrate that reduced prices and a free market within geographic boundaries produce commodities, and thereby prevent societies from capitalizing long term values of aesthetics, choice, and the ‘special’ environments we adore across all of europe in favor of a bland, disposable environment. We restrain competition in order to raise prices and therefore concentrate capital and we do it in many ways: political subsidy (money transfers like taxation, redistribution, and outright subsidy) constraining the market by qualification (lawyers, doctors and london cabbies), and constraining the market with monopolies (public transportation like Tubes and Buses). We unrestrain the market to reverse the concentration of capital and to reduce prices, and we do it in many ways: political subsidy of The natural order of man is to attempt to circumvent the market. The free market is a byproduct of the civic republican tradition’s advocacy of meritocratic equality. It is a rebellious movement against the control of markets and the expropriation of wealth by the state. Markets are a solution to corruption that asks us to create fair competition among equals and to maintain that set of ‘rules’ we call “competition in the market”. However, the natural behavior of man is to circumvent that market. The means by which he circumvents it are those tools we consider fair market competition: reducing prices, increasing choices, advertising and marketing. Not all cultures have taken this route. In fact, in history, the free market is an exception that concentrates wealth in hte hands of the monied, productive and creative minority. THis concentration benefits all by decreasing prices for nearly everyone. It limits the power of capitalists as long as there is enough money in circulation to create inexpensive competition. But since the culture or state determines the definitions of property (the means of calculating the use of opportunities to act) the rules for any ‘game’ are particular to that game. Rules are not universal to all games. They are plastic. And this comparison of Taxis to Tubes is perhaps one of the best ways to illustrate that these rules are inconsistent. But what may not be obvious is the DISTORTION that is created by the myth that rules must be equal for some things and unequal for others. Or, that lowest prices are the ultimate virtue to be sought by economsts and political economists. As a libertarian, I care that the choices available to me are not constrained by Concentrating capital attracts talent to the private sector where it is skimmed by private individuals, and those who lack talent to the public sector where it is skimmed by bureaucracy. Yet this is what most cultures seek to impose: expropriation by the bureaucracy. WE also constrain capitalists, and unconstrain capitalists. Capitalists can temporarily distort a market by applying capital that profits one company or anotther, requiring competitors to rely upon capital or depart. They can do this by simply extending debt, so that prices may be decreased in the anticipation of driving competition out of the market, and later increasing their share of the market as these competitors disappear. the problem with this technique is that talent accumulated in the industry is sometimes forced out. Niches are abandoned (the wall mart and home depot effect). The state acts like a disruptive capitalist creating temporary price decreases in return for decreased niche services, and in doing so makes it impossible to concentrate capital in niche excellences. It makes it impossible to subsidize a public good: choice of the more expensive, better, prettier. The purpose of the London cabbie is largely to create a public ‘good’. It enforces quality so that quality personnel can afford to work in the industry (rather than the horrid service, delivered by the filthy, ignorant and incompetent in US cities). Prices would drive down quality, and all that will happen is that you will need additional regulation to managed an impoverished and corrupt network of marginal businesses that deliver cheap but intolerable service that prevents quality competition from competing in the market. If you are willing to spend money on the tube. You have no argument against spending money to maintain a quality system of taxis. Just because market mechanics are POSSIBLE for taxis and IMPOSSIBLE for tubes, that doesn’t mean that taxis are not serving the same function as tubes. Lowest costs does not generally create a good. It creates a marginal enterprise. Aesthetics are forms of capital that are perhaps, the best investment that any civilization can make. For a country like the UK, whose history is an industry, you’d think that such a principle would be better understood. For a country that is creating demand through immigration, cash by selling off it’s assets, and the illusion of prosperity by dilution, inflation and redistribution, rather than by increases in productivity, it is understandable why a myth of exceptionalism would be a useful distraction from the fact that the UK is selling off its exceptionalism and it’s heritage, and would do even more so along with it’s taxi subsidies. Prices alone do not a world make. The purpose of the market is exploration. The purpose of unbridled market is prevent government exploitation. THe purpose of the regulated market is to capitalize SOMETHING for a social good. And not all social goods are consumables. Some social goods capitalize distortions to create beauty, which is a high return for a society, as all monuments, arts and architecture demonstrate. So, instead of universally pursuing consumption as an ultimate good. Instead of the keynesian virtue of spending. Perhaps we should balance our capitalist strategy with the art of saving. It took english civilization a very long time to create a culture of saving, and the institution of interest, so that the middle aged could save until they were old, and the old could lend to the young, in a virtuous cycle of investment that distributed the risk of long term calculation across a vast number of people, and wherein retirement security was an insurance scheme for the underclass rather than a mandate of the majority. This virtuous cycle was undermined. Perhaps we should return to it, and to other forms of capitalizing our civilization, so that we leave something behind for our heirs rather than the record of a visitation by locusts. Subsidizing quality is the entire point of aesthetics and the arts. And capitalizing everything from street signs, to cabbies to historic buildings to libraries and museums is an antidote to anti-historicism.
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Notes On “Adam’s Fallacy: A Guide To Economic Theology”
I’ve purchased two books, this one “Adam’s Fallacy: A Guide To Economic Theology”, as well as “Economics As Religion: From Samuelson to Chicago and Beyond”. There are any number of books on this theme. Note: This book was a waste of time and money. It is a silly marxist pamphlet. I can summarize it as “poor people breed too much and capitalism doesn’t care” when in fact, capitalism simply makes it very expensive to have children and those who breed irresponsibly are punished abstractly by enduring poverty rather than forced by village and tribal elders to leave their child exposed and dead. The vast silliness of the logic in this book is unworthy of further commentary. I’m surprised that this notion of economic religion is not more commonly discussed in the venal press. But it is too valuable a tool of those who wish to empower a democratic state and it’s politicians who are, quite frankly, at a loss to apply something other than the practicalities of getting elected, or the mysticisms of our founding documents, christian religion, or marxian fantasy. I start with Adam’s Fallacy. Using the KIndle edition on a mac, and therefore cannot annotate in place, and am not sure of page numbers. (This is a problem we need to fix, because we’re going to increasingly use dynamic text, which requires paragraph numbering not page numbering. Anyone remember wordperfect versus word?) PREFACE I am not sure I buy the argument that smith created a fallacy by separating market life from personal life. The Wealth Of Nations (TWON) is only the second half of his philosophy. the first is The Theory Of Moral Sentiments. (TOMS) They together represent his insight that the division of labor increases production and that human sentiments to cooperation at both the intimate, interpersonal, local, social and global level. While we are only in the preface, I’m not sure I buy the assumption because it’s too loose an assertion. Instead, I blame Knight and Keynes. Smith is nothing but a moral philosopher. “Contemporary economics has grown into a major intellectual industry” I hope this is elaborated further because it’s the the same problem presented by the clergy. People depend on perpetuating the faith. “Teaching economics reinforces the world view I call Adam’s Fallacy”. I don’t think so. I think that’s the crowd post 1900. “Teaching students to think like economists .. is hard.. and thinking like an economist … is just as value laden as any other way of thinking about society”. The idea in economic reasoning is the broken window problem: the need for all humans to think in terms of secondary causes and to follow the chain of secondary causes. This teaches people to think more deeply about the trade offs of both personal and political decisions. Yes it’s hard for people. Otherwise we wouldn’t need a market. CHAPTER 1 “The moral fallacy of smith’s positin is that it urges us to accept direct and concrete evil in order that indirect and abstract good may come of it.” Well, now, we need a definition of evil, don’t we? “neither smith nor … his successors have been able to demonstrate rigorously ad robustly how private selfishness turns into public altruism”. I don’t think he says that. I think he says that by participating in the market europeans will have fewer wars. CH1 – The Division Of Labor “Smith leaves unanswered the chicken and egg question of whether it is ultimately the human propensity to truck and barter that lads to the division of labor, or the division of labor that compels people to exchange.” Isn’t this a false dichotomy? People have always bartered and exchanged. the division of labor is simply more profitable for the individual. Ask any art-jeweler or craftsperson, who starts out producing one offs, but determines that quality of life depends upon his or her development of a product line that can reliably produce revenue, so that she is free to create those individually interesting pieces. The VIrtuous spiral of economic development. “Smith puts his faith in the ultimate benefits to be gained from the virtuous spiral to in crease standards of living and enhance the wealth of …. the sovereign.” “Smith SAYS LAW “… rise in labor productivity has at least one immediate and negative effect: a reduction in the demand for labor in the industries undergoing raid rises in productivity. …. unemployment can result.” “thus say’s law is based on a belief in the efficiency of the financial institutions of a capitalist economy” I don’t think so. I think it’s based on the belief that no other alternative is available while retaining the productivity RELATIVE to other nations, so that wars can be averted, and we can overcome the myth of the fixed-pie. “some of these displaced workers will eventually find alternative jobs” Yes, they will. They just might not like them. The alternative is that people should subsidize workers to produce goods at increased cost of goods to themselves and/or that the entire enterprise of production that employs ALL workers will fail to compete for market share against people from OTHER nations. In other words, it’s the smallest of three evils. “It appears that over long periods of time, says law does operate” Well, of course it does. At this point I’m frustrated because I don’t understand the problem. I know marxian fantasy must be in here somewhere by now. THEORIES OF VALUE I cannot for the life of me discern what point he is trying to make here. MARKET PRICE AND NATURAL PRICE Well, since the time of smith we understand that the labor theory of value is flawed and we have dismissed this part of smith as an error. So I don’t see this as material. he states in many more words ,that natural prices and market prices are in disequilibrium at all times. This makes no sense because a natural price is a tool for us to use to conceptualize movement, and a market price is a thing that comes into existence. So far either he is trying to accumulate a later argument or he’s simply confused. “contemporary economics on the the hand, focuses more theoretical attention on the the ideal imaginary state of equilibrium where market price and natural price coincide.” At this point he is trying to build an argument upon a falsehood – the labor theory of value and natural price. I hope that this is going somewhere. Either that or he is trying to state that the DSEM construct is a myth, and we all understand that it’s a myth. There is no bell curve. There is no equilibrium. It’s just a construct we use so that we can apply math because without that construct we CANNOT apply math. WAGES “… wages have the social function of allowing workers to reproduce themselves” (he means have children). “In order for wages to perform this function, they have to be high enough to allow workers to buy a subsistence standard of living” Ok, so this is supposed to be that the poor have the right to breed? So when did this become a social good? the problem for mankind since industrialization is that people simply don’t die, and they’re expensive. Our problem is overpopulation not supporting the unproductive people’s fantasy of unrestrained child birth. “Smith associates high wages and a high workers standard of living with a growing capital stock” Yes, I agree. at this point I understand that he is providing contemporary context. I read the rest of chapter1 and move to chapter 2 in the hopes that he is going to provide some insight here. Note to authors. Make your premise first then prove it so we don’t have to guess our way through your fantasy. FAR AHEAD “Behind this…. lies the unpleasant truth about capitalist social relations. The organization of the social division of labor through commodity exchange and wage labor systematically inverts the ordinary logic of human relationships.” What logic is that? That people have not exposed children for years, or even outright murdered them or sold them into slavery if they could not support them? In fact, breeding differences account for large differences in the prosperity of difficult cultures. So is this the author’s point? That he has some fallacious concept of the ‘right to breed’, instead of the ‘responsibility to only breed a child you can afford to feed?” Then he goes on to say that marx systematically breaks down and…. helps us understand. What he does instead is create a system of justifying primitivism. Look. We converted from hunter gatherers to farmers. We figured out how to control our breeding by creating the ‘family’ and monogamy. This made families economic units that could manage resources. We invented the market, and the tools of quantitative cooperation we call money, accounting, numbers, interest and credit. We increased our ability to breed further, but penalized those who have less foresight. Capitalism creates temporary extraordinary wealth then forces people to control their breeding in order to participate in the wealth. Those who don’t, suffer because of their choices. We just have a more abstract way of controlling population. ( INSERT A VAST AMOUNT OF JUSFICATIONISM OF MARX HERE. ) ESCAPING ADAM’S FALLACY “thus we cannot look to capitalism to solve inequality and poverty” That is correct. WE can only look to capitalism to provide the incentives for controlling reproduction so that the poor do not doom themselves to perpetual poverty in a world where children do not provide security or comfort but are a drain on resources. In other words. This is a silly marxist book, and I wasted two hours reading it. The chinese solved it with the one child policy, and it was a good policy and successful. Rather than redistribute ourselves into mutual poverty and regale the thought leaders of the past, you could simply write a book on the value of the one child policy, or at least, pay men and women to sterilize themselves. Capitalism makes poverty a choice of reproduction.
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You Do Not Engineer A Company. You Grow It.
This is a response to an article posted on An Entrepreneurial Mind. In that post the author, Dr Cornwall recommneds writeing a business plan. And the steps for doing so. And I’m of the opinion that that’s just silly. A plan is a tool for managing weak leaders. A plan is what oyu write when you have given control to investors. A plan is what you write so that a leader who lacks knowelgde, understanding and vision can give his consent. A plan is the myth that teachers instill in students as a substitute for the act of critical analysis. I write a plan every six months. It’s detailed deep and critical. From it I extract goals, an ignore the plan. Goals are just longer term opportunities that we work to exploit. They are rarely and end unto themselves. There is no end of history. And there is no end of business.
You can’t engineer your company any longer. The reasons are complex, but they have a lot to do with the availability of capital. There is more of it. Raising money today, even in this environment, is very different from the 1980’s. Because of this, no one writes a business plan any longer. At least, It’s a sign of naivety in the business community. They are an artifact of the era of post war engineering. A myth held by the young and inexperienced. A device used to provide false confidence to failing management. A plan is what you write when you think you know something but don’t, and often cant. The truth is, that the reason young people don’t like to write business plans is because they don’t have the knowledge to. A business plan is a contract among participants, and it is the wrong type of contract for the wrong type of processes and goals. And entrepreneur who authors a contract does so in order to hand over his sovereignty to someone else. Or he uses it because he lacks the sovereignty to act as an entrepreneur. As such, a business plan is a sign of weakness. Of immaturity. Of lack of sovereignty. It is a contract for a false good. When instead, he should have a list of MBO’s, and a financial model – a set of tools that maintain his sovereignty – his ability to adapt to circumstances. The problem isn’t a plan it’s the research. It’s the knowledge. The problem with planning is that it does not reflect business, and hasn’t in half a century. Napoleon didn’t plan. Napoleon mastered his environment. He read everything he could. He hired spies. Read shipping records. Red mail. Read ship manifests. Read intercepted letters. He collected just about all the information that he could. Then he mobilized his forces to take advantage of opportunities that presented themselves. This is a very different way of looking at business strategy. (See Duggan and Keegan) Collect the information that you need to run your business. all of it. Take advantage of every opportunity. Build an INTELLIGENCE NETWORK first. Intelligence networks allow you to identify and exploit opportunities. How do you build your intelligence network? How will information get to you? What kind of non-quantitative intelligence can you and your people gather. The best sales teams meet weekly and review what they have LEARNED about their target accounts. THis process teaches everyone. The CEO should collect that information. But this is also true of marketing, of vendors, of distributors of partners, of the government. It is a vast information problem. I tend to ignore what competitors are doing except when directly competing with them. It is far easier for your staff to pay attention to competitors than it is for them to pay attention to consumers. But systematically collecting customer and consumer information is priceless. The best opportunities are those where someone larger than you are needs something that they cannot achieve for bureaucratic reasons. In those cases you build a company to sell to someone larger. I always start a company with a list of companies I would like to sell it to. The next best opportunities are those where the existing people in an industry are enamored of their value chain, and you can innovate and take their business because of it. THe next best opportunities are those where you can collect either better talent, or better capital than competitors. In most cases, it is easier to steal talent from a bigger and stronger competitor if you have ‘seats at the table’ in your company available. The next best opportunities are those where you have a technological innovation that you can put to practice and patent. This is far harder than it would seem. The next best is where you arbitrage rather than create value: where you have lower costs. This is almost always a bridge strategy. Lower costs are not a sustainable market position. They simply assist in some other market position. Many people are trapped in being small because their only advantage is low cost. Low cost usually means low talent, and talent is what makes your business competitive. It is better to look for increased value and higher cost that people are willing to pay for. Write short definition of a one-year success criteria. If you made these things happen your first year, then would you be successful? Do this every year. I do mine every six months. I hang them on the wall behind my office door. Plans that are longer than that are questionable. Goals may be valuable. Plans are not. Largely, size, number of employees, number of customers, amount of revenue is all good. The rest is just self aggrandizement. Write a one page description of your product, products, or services. If you cannot sell it in one page, then you cannot sell it. Get market research on every competitor, large and small. Take greater interest in why people failed than in why people succeeded in your industry. Most of the time it’s simply tactical. Make a list of all your customers that you can think of. try to understand why they make a purchasing decision. It is very often not intuitive. It is often counter to the reasons you think your product or service has value. One man tried to sell a software system to a bank. But it would have eliminated the department. The VP would ave no one to manage. He poisoned the sale. People in bureaucracies are not entrepreneurs. You have to create a value proposition that appeals to them. Map our your supply chain. Who will you need things from? Why will they give you attention? What will it cost to maintain them? Map out your distribution chain. Who will you distribute your goods and services through? will you rely on yourself alone? a large sales org? channel partners? Alliances are almost universally meaningless. they are a waste of time. Create a very complex, detailed operational spreadsheet. It should be as close to an accurate version of your chart of accounts, balance sheet, income statement, and all costs and cash flows as is possible. Be paranoid and conservative. Mine are usually good enough to run the business on, and I mandate that accounting systems and management reports mimic them. Usually 10-15 pages of spreadsheets. Create a list of the people you know of or think that you can recruit into your organization who will put extraordinary effort into the business. I have started eight companies and I care more about my people than I do about any other factor. good people make a business. Start recruiting them. If you cannot interest them, then you are not going to interest a customer, banker or investor. It takes nine months to do anything. Make a baby. Forget a bad memory. Lose confidence in a market. Develop new relationships where trust is involved. Work for 9 months testing your theory and trying to prove out your ideas. To do that you need nine months of money. During this time take advantage of every opportunity that you can as long as it either gives you cash to fund your business, or it advances your relationships, customers and employees. Write a ‘Book’, for investors on how you expect to use your business to make them money. They do not care about your idea. They care wether you sound like you know what you’re talking about, whether you and your team have experience, and whether you have any ‘advantages’ that they can understand. WHile investors claim knowledge, most of them are in their jobs not because of business experience but because of relationships and luck. Your job is to make them feel comfortable that you are going to make them money. Emphasize that you have an ‘in’, like a major customer, a larger company that you provide a service for or an off-book-r&D effort you’re going to speculate on. And be willing to fail. It is far harder to be an entrepreneur than to work for someone else. You work far harder for less money but more joy and more control over your life. Entrepreneurship is a lottery. You can win. But you have to understand that luck is a very important factor in your success, because you cannot know enough going in to be sure you will succeed. In general, plans are silly. Goals and models are not. Make a model. Revise it constantly based on new knowledge. Stick to nothing. The purpose of goals is simply to provide yourself with decision making criteria when there are many decisions to be made and most of them seem ambiguous. A plan commits you to something and forces you to organize your business rigidly. A business does not execute a plan. It is a large number of people who identify create and exploit opportunities. Your job is to fund an intelligence network that will give you the largest number of opportunities that you can continuously reorganize your company to exploit. And continuous reorganization is far harder than most people think. but it is far more durable. GIve your people six month MBO’s. Even quarterly. Yearly for very top people. Realize that you must learn and that the only way to know anything is by experience. Entrepreneurship cannot be taught. It can only be learned. Because you must learn to run a business in real time. Education can simply give you the tools. But you can sit and ponder things during your education that must be made at risk and peril in real life. If you are craftsman, you ply your trade. You seek opportunities. You learn your skill well enough to compete. If you get to be an entrepreneur, you will have sacrificed all your time, all your thoughts, and devoted more of your life than common people to your job and will become effectively a machine that takes in information compares it against a model and decides if it can be used to achieve goals. The more information you have, the earlier, the more opportunity you can wring for your business. If successful, at some point you will hand over this duty to someone else, who will, not as well as you, do the same opportunity sifting. You will instead, move to longer term opportunities, like relationship and capital management. This is when you get to take your rewards. Whether you get there or not depends on whether you are enough of a mentor and teacher so that your job can be done well enough by others while still paying you well enough that you can afford to compensate someone talented enough. There are a lot of hard working ceo’s that can’t grow their companies. The reason is that they are not paternal enough. They are working a job rather than raising a family. They try to add value by doing something themselves – which is a convenient distraction from building your business. Execution is a staff function, not an entrepreneurial one. Instead, if you’re doing hard work, you should only do it long enough to understand it well enough so that you can intelligently hire someone to do that job, so that you can move onto the next opportunity that needs creating or exploiting. Working hard is good as long as you’re working on the right things. People need different kinds of fitness. Physical fitness is obvious. Scientific fitness is something else. Oratory fitness something else again. An entrepreneur’s fitness is his ability to create an organization that identifies and exploits opportunities. It’s a knowledge problem. FItness is your ability to process information. To judge people. To make decisions in real time. To make them faster and better than your competitors. Evolve your company. Don’t plan it. Parent and Grow it. Don’t engineer it. If what you mean by planning is modeling then that’s a useful tool that gives you understanding. But if planning is the act of mandating self ignorance so that you do not invest in the act of building an intelligence network that you can exploit for opportunities, then planning is just an excuse to bury your head in the sand, or an admission that you lack the intellect to process the information needed to act as an entrepreneur. Very little than men produce today other than biological research is complex. Almost all business problems are not those of production, but those of opportunity identification and exploitation given the fact that resources and production, like technology itself, a temporary and limited advantage. An entrepreneur is a maker, identifier, calculator and exploiter of opportunities. Everyone else is just a clerk. Curt
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Germany Should Exit The Euro And Return To the Mark
THe NYT Opinion page includes recommends Germany leave the Euro? (Referring to a posting elsewhere.) Yes, it makes sense. Earlier last month I wrote a series of letters and posts recommending Germany pull out of the Euro myself. Mediterranean Europe and Germanic europe are too different in culture, social structure and values. Restore the DM. Leave the Euro to the southern countries who need it, and have similar social values, and are willing to fund those social values. Currencies as they are currently used, are the primary means of social insurance and redistribution. People are naturally gregarious to their own ethnic groups, and are naturally not gregarious with what they see as competing groups, and in particular, groups that they see as a permanent drain on their resources. Because currencies are a means of social insurance they are inseparable from the social orders that employ them. Countries need their own currencies. The spanish, italians and greeks can then maintain their historical poverty born of their less productive lifestyles, without impoverishing the north. Besides, the north has a new permanent semi-revolutionary underclass it is supporting at home to deal with. THe USA has a similar problem. It is a domestic empire over somewhere between four and six separate cultures, with entirely different economic interests, and cultural interests, and political friction between them is becoming intolerable. The only reason that america government has functioned since the 1900’s, is because of the two party system, and the south’s rejection of the republican party. With the south now more pragmatic, this prior balance has been shattered, and the country is increasingly a north and west against a south and interior. For exactly the same reasons as europeans face these problems. It is all well and good to believe in the myths of egalitarian secular humanism, while you’re living in a temporary era of post-war, then post-soviet prosperity. But western civilization no longer has it’s economic advantage over the rest of the world. The west will be permanently poorer, even if retaining it’s ordinal status, for some period of time, simply due to the northern european people’s ancient tendency to eschew corruption. Since a currency is a reflection of social values, nations need their own currencies. The euro was a failure. Return to the DM.
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The first problem with laws is that they do not die with the fools who wrote the
The first problem with laws is that they do not die with the fools who wrote them.
Source date (UTC): 2010-03-20 00:28:24 UTC
Original post: https://twitter.com/i/web/status/10748682890
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An Understanding Of Greenspan
A more analytical understanding of Greenspan: First, If you read enough of Greenspan, he tried to master the processes by which businesses actually made decisions, to a degree that few economists ever attempt. He was intimately aware of the daily needs and habits of business. He was intimately informed in a way few others seem to have been. Second, he actually believed the new devices for distributing risk (along with the formulae of the quants) would work as prescribed. Third. like most people of the Regan/Thatcher era, he was trying to counteract socialist influences in society. They had very clear memories of the pre-johnson era and also had the unfortunate experience of living through the 1970’s, which was about as depressing and hopeless as the times we face today. It was from this contrast that they took their motivation. We forget that in retrospect, these people were trying to use monetary policy to reconstruct prior libertarian values. They hoped to rebuilt a society of individual responsibility (and ownership) using a tool which accomplishes the opposite, even if they felt using that tool was acceptable if it was only used for the short term. It is in these three errors that Greenspan built his house of cards: first, business can use credit to privatize wins and socialize losses, and did so. Deep knowledge of business is good, but deeper knowledge of human nature is even better. Personally I am not sure this device to retrain people out of socialistic beliefs would not have worked had the state provided direct liquidity into competitive innovation in the Indian model rather than general liquidity, and regulated banking such that all originated loans must remain with their originators. In effect libertarian values need to come from somewhere. They are not terribly natural to man. And liberty has always, throughout history, been the objective of a minority. (PLease don’t beat on me for advocating state intention, i”m not attempting to do so, only explain what would have been possible in context.) Second, the new devices and formulae were erroneous, and for commonly stood austrian reasons: the quantitative content of these devices is inseparable from the individual knowledge of the loan’s originator. Very little debt is predictable under duress, and it cannot be aggregated, because fundamentally all credit consists of unique categories, because these categories are determined by knowledge only available to the originator. Third, the influence of these people on the momentum of the bureaucracy, was insufficient. And that is the real Misesian/Rothbardian problem. To enact such a thing at scale would require political force actively despised by the field’s advocates. Describing an ideal state of affairs is an impressive and important research program. It has yielded most of the answer we are looking for in solving the problem of economic, political and social theory. People in our libertarian camp, have not supplied yet a sufficiently POSITIVE argument for political economy. Hoppe is closest. Hayek tried desperately. But Mises, Hayek, Parsons, and Popper all failed to provide a sufficiently positive argument. It certainly appears that Keynes did find a sufficiently positive argument even if it was an erroneous one. (Although the debate is open on whether he would have approved of how his ideas were used.) But more importantly, libertarians are a minority. We have always been a minority. And we are likely to continue to be one. We have a philosophy of the entrepreneurial class. And as a class philosophy it is an insufficient philosophy as currently constructed. That is, unless we understand that in this division of labor we need at least three philosophical frameworks: one for each class. As such, while Greenspan failed, I don’t blame him for failing, any more than I blame Rothbard, Mises, Hayek, Popper or Parsons for failing. It is becoming clear that the dominant political structure of the future consists not of democratic capitalism, nor social democracy, but of totalitarian capitalism, because only totalitarian capitalism can concentrate capital in sufficient quantity and rapidly in time to maintain the status of elites in one nation against those of others. And if we think that there will not be political elites who profit from their position, then we do not understand the history of mankind.
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Agency Must Become A Consumer Advocate Rather Than Ally Of ‘The Man’
January 6th, 2010
Throughout history, innovative groups have formed an alliance with ‘The Man’. Bankers have done it forever. In fact, bankers don’t exist where they DON”T ally with ‘The Man’. Capitalists allied with ‘The Man’. They concentrated wealth, by borrowing from bankers to develop ships, machinery, manufacturing, and other increased forms of production. They became ‘The Man’. Entrepreneurs allied with bankers, capitalists and ‘the man’ to distribute goods to the common man, for the first time in history, at such low costs that almost everyone could afford to have more than one pair of clothes for the first time. They became ‘The Man’. Advertisers helped market these goods to consumers, and for 150 years, they helped convert society from religious and nationalistic, to a society of consumers, and urban and suburban tribes. With the advent of technology, Advertising agencies became ‘The Man’. Creatives, who were generally hired craftsmen serving the nobility in most of history, flocked to the movies and advertising, and and allied with ‘The man’. And the demand – the boom – in demand for creatives, allowed the entry of more and more people into the creative industry, albiet, with the acknowledgment that the number of really good creatives, as well as the number of really good academics, or really good high-art artists, seems to remain constant. Like the tech boom, that made room in technology for lots of people who were not that good at it, there was a creative boom. Creatives, allied with ‘The Man’ to take advantage of the increase in available capital that allowed them to experiment with other people’s money.
Now what’s important here is understanding what makes you ‘The Man’. Being ‘The Man’ means that you have control over resources. Kings, thugs, and brigands controlled passes, trade routes, and taxation. Bankers controlled access to money. Capitalists controlled access to production. Entrepreneurs controlled access to goods. Agencies controlled access to media.
The tech boom deflated in just over a year, because it was fueled by speculative capital. The agency boom deflated along with the population that concentrated capital. concentrated production. Concentrated distribution. concentrated media. It deflated at the same rate the demographics deflated, and at the rate the mythos deflated that was held by that population.
There is no concentrated population now. That’s the important message. It’s not a moral message. It’s simply a
There is no concentrated common-aspiration, like the american dream. Instead we have tribes with little status identities.
There is no concentrated access to media now. Instead we have more media than we have content that people desire. We have a shortage of mythic content to feed identities and tribes with to replace traditional, and postwar, and consumer, and american dream mythologies.
There isn’t any concentrated culture any longer. There isn’t any concentrated trade route any longer. There is no ‘Man’ to ally with. There is no general consumer mythos to exploit. And the disappearing boom
There isn’t the problem of getting attention for a product, using a frame of reference like a mythos, so much as the problem of understanding some tribe’s mythos and figuring out how to insert your frame of reference into their mythos.
A long time ago, there were castles on passes. Because the government was formed by brigands charging taxes, or protection racket fees, for people to take goods and services through a geography to reach markets. There are no media-channel protection rackets any longer. Just markets. There is no tax to levy on reaching those markets, that will fund ‘The Man’. The Agency Man.
We have no ‘The Man’ any longer. We have only these small tribes of consumers who have rejected The Man, in all his forms, because he doesn’t need him. He doesn’t need The Man. and he doesn’t need the stories that Creatives have written to serve The Man, to enter into, and he doesn’t want them either. He has his stories. He has his suite of tribal myths. He sees them as his property. He sees them as his identity. And he acts as if these myths are his identity and property. And by acting as if they are real, he makes these abstractions real things. He sees society through the lens of his identity and his myths, and judges his success at finding his place in society by using them – he has nothing else to go by. He obtains his status from using those myths, not from myths created by agencies and creatives on behalf of ‘The Man’.
The Man concentrated people for us. That’s what The Man has always done. We made popular messages for distribution on The Man’s distribution channels. We served ‘The Man’.
Our job is not to ally with The Man, and claim it’s our talent that made a difference rather than his control over passes and people because of it. Our job is to build relationships between brands and tribes. To find out who is passionate and motivate them to create status symbols from our products if possible. If that is not possible, then to create lower status reasons for social interactions. And if that is not possible the to create simple utility.
Advertising, is, and will always be, part of this process. But advertising is no longer the process of concentration people and their purchasing power using available myths and demographics. It is the process of separation and service of identities. Advertising can’t easily inspire any longer on it’s own. It isn’t intimate or meaningful enough. It can legitimize a message. It can tie messages together. It can create awareness, but not change consumer behavior, unless you apply an awful lot of money to the problem.
While vast consumer brands appealing to the low end of the market, will always need to create myths of consumer homogeneity, those myths are limited in their ability to compel consumers to aspiration rather than to the ideas of suffrage, or sarcasm or nihilism. These are negative identities. And a brand who crates homogenity is like a politician who advocates fear: it works in the short term, but it doesn’t make people love you and stick with you. And it doesn’t make them respect or trust you.
Aspirational brands must create niche appeal, with increasingly tribal identities, in order to seem sincere, and in order to make the consumer feel passionate enough to appeal to a brand whose marginal difference in utility is extremely limited if not entirely aesthetic.
Yes, those large retailers will control distribution, because of the capital that they concentrate with the use of debt – debt that they may have a hard time getting ahold of now. But brands must exist within those retail identity myths. And the retailer, like a government, will allow only so much difference between one brand and another – they don’t want intra class conflicts. So they are a resister to excellence.
But our clients, and our brands need to understand that there is no concentration of identity or mythos, or channel which we can exploit.
Creatives no longer can ally with the man. They have to ally with the consumer, and use the man for the consumer’s benefit.
In a world where there is no concentration, no homogeneity, we have succeeded in building the consumer society. There is no real scarcity. We are not afraid of running out of rice and beans, or laundry detergent for that matter. We are only afraid of being lost in society because we cannot judge our status in it – our success or failure in it, our mating ritual in it, without identities and myths that help us do so.
The consumer is The Man.
from: www.puretheoryofmarketing.com